August 19, 2020 Newsletter

Dear Friends,

Tangents:
On Aug. 19, 1934, a plebiscite in Germany approved the vesting of sole executive power in Adolf Hitler as Fuhrer. Go to article

On August 19, 1942: Over 4,000 Canadian and British soldiers were killed, wounded or captured raiding Dieppe, France, during World War II.

At last: Scientists think they have found a cure for hangovers.-Bloomberg.

Earth’s magnetic field is doing weird stuff. –Alistair Low, Bloomberg

It’s World Photography Day, so feast your eyes on some of the most striking photo stories that have been published this year. -CNN.

The pandemic has left Italy starving for tourists this year, but after incidents like an unauthorized dip in the Grand Canal in Venice and an unfortunate toe mishap involving a plaster statue at a museum in northern Italy, Italians say visitors should not feel free to behave badly.
Speaking of traveling, do you have dreams of being a digital nomad? Several countries with fragile tourist economies have started to offer visas that allow foreign nationals to live and work for a period of at least six months. –The New York Times.

PHOTOS OF THE DAY

The giant rainbow appeared briefly over the 5,000 year-old Stonehenge monument near Amesbury, Wilts.
CREDIT: CHRIS ORANGE/SWNS.COM

The finest drops of water from the morning dew pearl on a spider’s web as the sun rises in the Leinemasch near Laatzen, Germany.
CREDIT: JULIAN STRATENSCHULTE/DPA VIA AP

A woman walks past a showcase with a Thorah scroll in the new core exhibition ‘Jewish Life in Germany: Past and Present’ at the Jewish Museum in Berlin, Germany.
CREDIT: AP PHOTO/MICHAEL SOHN

Five women stand in shallow water collecting bright pink and white water lilies as their boats drift nearby. They spread the long plants out in a circle around themselves and let them float on the surface as they harvested them.
CREDIT: NGOC DIEM/SOLENT NEWS & PHOTO AGENCY

Market Closes for August 19^th , 2020 

International Markets

Bonds

Currencies

Commodities

Market Commentary:
On this day in 1883, Jeanne Gabrielle Chanel was born in Saumur, France, the illegitimate daughter of Albert Chanel, an itinerant peddler, and Jeanne Devolle. Later known as “Coco,” Chanel overcame her shabby past and became one of the most powerful forces in the world’s fashion industry.
Canada
By Michael Bellusci
(Bloomberg) — Canadian equities fell alongside U.S. stocks after the Federal Reserve minutes signaled tempered optimism about growth in the second half of 2020. The S&P/TSX Composite Index dropped 0.3%, with seven of eleven sectors lower. Materials led the decline, while health care also lagged. Utilities were among gainers. Spot gold fell to a session low after minutes of the Federal Reserve’s last meeting showed U.S. central bankers appeared to back off from an earlier readiness to clarify guidance on the future path of interest rates. Meanwhile, the Canada Pension Plan Investment Board’s thought leadership lab sees permanent changes to consumer behavior as a result of the global pandemic.
Commodities
* Western Canada Select crude oil traded at a $11.60 discount to West Texas Intermediate
* Spot gold fell 3.3% to $1,937 an ounce
FX/Bonds
* The Canadian dollar fell 0.4% to C$1.3217 per U.S. dollar
* The 10-year government bond yield rose 1.9 basis points to 0.579%

By Bloomberg Automation:
(Bloomberg) — The S&P/TSX Composite fell for the second day, dropping 0.3 percent, or 48.68 to 16,577.38 in Toronto. The move was the biggest since falling 0.7 percent on Aug. 11. Barrick Gold Corp. contributed the most to the index decline, decreasing 3.4 percent. B2Gold Corp. had the largest drop, falling 7.5 percent. Today, 122 of 221 shares fell, while 95 rose; 7 of 11 sectors were lower, led by materials stocks.
Insights
* The index advanced 1.7 percent in the past 52 weeks. The MSCI AC Americas Index gained 15 percent in the same period
* The S&P/TSX Composite is 7.8 percent below its 52-week high on Feb. 20, 2020 and 48.4 percent above its low on March 23, 2020
* The S&P/TSX Composite is unchanged in the past 5 days and rose 2.8 percent in the past 30 days
* S&P/TSX Composite is trading at a price-to-earnings ratio of 24.2 on a trailing basis and 24.7 times estimated earnings of its members for the coming year
* The index’s dividend yield is 3.2 percent on a trailing 12-month basis
* S&P/TSX Composite’s members have a total market capitalization of C$2.54t
* 30-day price volatility rose to 10.74 percent compared with 10.63 percent in the previous session and the average of 13.03 percent over the past month
================================================================
| Index Points | |Sector Name | Move | % Change | Adv/Dec
================================================================
Materials | -50.9363| -2.0| 12/38
Information Technology | -9.0399| -0.5| 7/3
Energy | -1.9938| -0.1| 13/9
Health Care | -1.6938| -1.1| 3/6
Real Estate | -1.3857| -0.3| 4/22
Communication Services | -0.5454| -0.1| 4/4
Consumer Discretionary | -0.0612| 0.0| 5/8
Consumer Staples | 0.2604| 0.0| 5/6
Industrials | 3.0220| 0.2| 18/10
Utilities | 5.0585| 0.6| 9/7
Financials | 8.6292| 0.2| 15/9
US
     (Bloomberg) — Stocks dropped and the dollar rose after the Federal Reserve minutes signaled tempered optimism about growth in the second half of 2020. Treasuries fell as policy makers panned yield-curve control. The S&P 500 erased gains as the Fed noted the health crisis would “weigh heavily” on economic activity and repeated its view that the path of the recovery would depend on containment of the virus. U.S. central bankers also appeared to back off from an earlier readiness to clarify their guidance on the future path of interest rates when they met in July. Benchmark 10-year government bonds slid after the minutes refrained from citing prospects of changes to the size or composition of the purchases of Treasury securities. The greenback advanced after a five-day rout.
Traders pushed down the value of equities after the S&P 500 closed at a record for the first time since the pandemic started amid ultra-easy monetary policy and massive stimulus measures. The buying stampede fueled debate on whether momentum can be sustained amid lofty valuations and uncertainties over further government relief that could help lift the world’s largest economy from a coronavirus-induced recession. Policy makers are likely more worried about the pace of the recovery “given the stalemate on fiscal stimulus in Washington,” said Marvin Loh, senior global macro strategist at State Street. “The Fed will continue to do what it can, but it does feel that fiscal is as important in the recovery process as monetary, and their tools to get funds to Main Street remain constrained.”
Democratic and Republican leaders are hinting that they are looking for a path toward reviving stalled negotiations on the next round of pandemic relief — even as both sides remain far from a deal. Any accord is still likely to wait until September despite the fact that the U.S. economy is limping along with many businesses still struggling and millions of Americans out of work. While policy makers will be on the lookout for signs of inflation, a bigger concern for the Fed is actually deflation as the pace of the economic recovery continues to moderate, according to Adam Phillips, director of portfolio strategy at EP Wealth Advisors. “The minutes suggested that policy measures like yield curve control and explicit forward guidance aren’t guaranteed, and could create some upward pressure on long-term bond yields over the near-term,” he said.
Some corporate highlights:
* After the close of regular trading, Nvidia Corp. reported revenue for the second quarter that beat the highest analyst estimate.
* Apple Inc. made Wall Street history on Wednesday when its 2020 stock surge pushed the market value over $2 trillion, the first time a U.S. company has surpassed that level.
* Target Corp. posted record sales and profit last quarter.
* Lowe’s Cos. reported a strong summer sales pace that beat estimates.
* Johnson & Johnson agreed to buy Momenta Pharmaceuticals Inc. for about $6.5 billion to expand in treatments for autoimmune diseases.

Here are some key events coming up:
* Results from Alibaba Group Holding Ltd. and Qantas Airways Ltd. are due Thursday.
* U.S. jobless claims for the week ended Aug. 15 are due Thursday.
* China’s loan prime rate is due Thursday.
* Euro-area PMIs will be released on Friday.

These are some of the main moves in markets:
Stocks
* The S&P 500 dipped 0.4% as of 4 p.m. New York time.
* The Stoxx Europe 600 Index advanced 0.7%.
* The MSCI Asia Pacific Index sank 0.5%.
Currencies
* The Bloomberg Dollar Spot Index jumped 0.6%.
* The euro sank 0.8% to $1.184.
* The Japanese yen weakened 0.6% to 106.08 per dollar.
Bonds
* The yield on 10-year Treasuries increased one basis point to 0.68%.
* Germany’s 10-year yield fell one basis point to -0.47%.
* Britain’s 10-year yield advanced two basis points to 0.236%.
Commodities
* The Bloomberg Commodity Index declined 0.2%.
* West Texas Intermediate crude fell 0.1% to $42.83 a barrel.
* Gold depreciated 3.1% to $1,939.70 an ounce.

–With assistance from Sophie Caronello, Joanna Ossinger, Adam
Haigh, Todd White, Sam Potter, Lynn Thomasson, Ryan Vlastelica and Katherine Greifeld.

Have a great night.

Be magnificent!
As ever,

Carolann

The liar’s punishment is not in the least that he is not believed, but that he cannot believe anyone else.
                                                                                      -George Bernard Shaw, 1856-1950

Carolann Steinhoff, B.Sc., CFP®, CIM, CIWM
Senior Investment Advisor

Queensbury Securities Inc.,
St. Andrew’s Square,
Suite 340A, 730 View St.,
Victoria, B.C. V8W 3Y7

Tel: 778.430.5808
(C): 250.881.0801
Toll Free: 1.877.430.5895
Fax: 778.430.5828
www.carolannsteinhoff.com