January 26, 2022 Newsletter

Dear Friends,

Tangents:
2020: American basketball player Kobe Bryant dies in a helicopter crash at the age of 41.  Kobe was considered one of the sport’s greatest players, winning five NBA championships with the Los Angeles Lakers.

1788: The first European settlers in Australia landed in present-day Sydney.  Go to article » 

The Bills-Chiefs game was the most-watched TV event since last year’s Super Bowl.  Were you among the 43 million people watching on the edge of your seat?
Gary and I watched the game – it was amazing!

A Scottish school project from 1996 ends up in Norway, 25 years later.

Once you know what failure feels like, determination chases success. -Kobe Bryant, 1978-2020.

PHOTOS OF THE DAY

A photomontage of Parliament Hill lido by the artist Belinda Lawley who has been investigating the rise in popularity of outdoor swimming. The image will be on display at the lido from Friday
CREDIT: Belinda Lawley

A whirling dervish performs on the frozen Lake Cildir
CREDIT: Gunay Nuh/Anadolu agency/Getty Images

Heiko Breuer, a conservator from the State Museum of Prehistory in Halle, Germany, shows off the Nebra Sky Disc, the world’s oldest map of the stars, which will be displayed at the British Museum’s Stonehenge exhibition
CREDIT: Dominic Lipinski/PA

Market Closes for January 26^th, 2022

International Markets

Bonds

Currencies

Commodities

Market Commentary:
On this day in 1921, Akio Morita, future co-founder of Sony Corp., was born in Nagoya, Japan.
Canada
By Stefanie Marotta
(Bloomberg) — Canadian equities edged higher after the Bank of Canada and the U.S. Federal Reserve signaled that they could hike interest rates as soon as March.
The S&P/TSX Composite advanced 0.02% to 20,595.89 in Toronto.
Bank of Montreal contributed the most to the index gain, increasing 1.3 percent.
Turquoise Hill Resources Ltd. had the  largest increase, rising 6.1 percent.
Today, 122 of 241 shares rose, while 115 fell; 6 of 11 sectors were higher, led by financial stocks.
Insights
* This month, the index fell 3 percent
* The index advanced 16 percent in the past 52 weeks. The MSCI AC Americas Index gained 11 percent in the same period
* The S&P/TSX Composite is 5.5 percent below its 52-week high on Nov. 16, 2021 and 19.1 percent above its low on Jan. 29, 2021
* The S&P/TSX Composite is down 2.9 percent in the past 5 days and fell 3 percent in the past 30 days
* S&P/TSX Composite is trading at a price-to-earnings ratio of 18.6 on a trailing basis and 14.3 times estimated earnings of its members for the coming year
* The index’s dividend yield is 2.7 percent on a trailing 12-month basis
* S&P/TSX Composite’s members have a total market capitalization of C$3.29t
* 30-day price volatility fell to 12.25 percent compared with 12.40 percent in the previous session and the average of 13.58 percent over the past month
================================================================
| Index Points | |
Sector Name | Move | % Change | Adv/Dec
================================================================
* Financials | 27.4372| 0.4| 16/10
* Energy | 17.2648| 0.6| 14/16
* Consumer Discretionary | 8.3674| 1.2| 8/6
* Utilities | 3.1771| 0.3| 11/4
* Real Estate | 2.1541| 0.4| 12/11
* Consumer Staples | 0.1892| 0.0| 9/2
* Communication Services | -0.6979| -0.1| 1/5
* Health Care | -2.5531| -1.8| 0/8
* Industrials | -6.1287| -0.3| 23/7
* Information Technology | -14.8239| -0.9| 12/4
* Materials | -29.4653| -1.2| 15/40
================================================================
| | |Volume VS| YTD
|Index Points | | 20D AVG | Change
Top Contributors | Move | % Change | (%) | (%)
================================================================
* Bank of Montreal | 8.4020| 1.3| 37.7| 7.4
* Enbridge | 7.7810| 1.1| 9.8| 5.8
* Bank of Nova Scotia| 7.5860| 1.0| -25.4| 1.0
* Brookfield Asset Management | -11.1200| -1.6| 40.0| -12.5
* Canadian National | -18.2700| -2.8| 208.5| -3.1
* Shopify | -22.2900| -2.5| 72.1| -36.8
US
By Rita Nazareth
(Bloomberg) — Stocks gains fizzled out and bond yields spiked as Jerome Powell signaled the Federal Reserve will steadily unwind its pandemic-era stimulus as it fights rampant inflation.
The S&P 500 posted a back-to-back loss after rallying more than 2% earlier Wednesday.
Meantime, the dollar climbed to a one-month high and 10-year Treasury yields approached 1.9%.
The central bank chief said he backs a March liftoff and won’t rule out a hike every meeting, while noting he’s inclined to boost his forecast for inflation by a “few tenths.”
In its statement, the Fed signaled its first rate hike since 2018 will happen “soon,” while saying it expects a balance-sheet reduction to start afterward.
Swaps traders are now pricing in around 30 basis points of tightening at the next central bank gathering in March.
The Fed typically moves rates in increments of 25 basis points, so that kind of pricing suggests that at least a standard hike is certain and there is around a one-in-five possibility of a 50 basis point hike.
Around 1.13 percentage points of tightening are priced in for the whole of 2022.

Comments:
* “After hearing Fed Chair Powell talk, it became clear the risk of more rate hikes was elevated and the earlier Wall Street rally fizzled,” wrote Edward Moya, senior market analyst at Oanda.
* “Powell made it as clear as possible that the Fed was willing to start raising interest aggressively, starting as soon as the next FOMC meeting, and continue doing so until inflation showed signs of falling.
Not surprisingly, markets took these comments as a signal that tighter policy was coming, and we’ve seen a predictable response,” wrote Matt Weller, global head of research at Forex.com.
* “The stock market is especially vulnerable to higher rates and the removal of the tailwind that the Fed’s asset purchases have provided for the past two years,” said Chris Zaccarelli, chief investment officer for Independent Advisor Alliance. “We believe the economy will stay out of recession and the bull market in stocks will continue this year, but we are concerned that the volatility we have already witnessed this month will increase in the months ahead and would exercises caution in the near term.”

Other corporate highlights:
* Microsoft Corp. said its cloud-computing business has potential to drive growth, while Texas Instruments Inc.’s upbeat outlook signaled demand for electronic components remains high.
* Plane maker Boeing Co. recorded $5.5 billion in total charges and costs to cover higher factory and customer expenses for the 787 Dreamliner.
* AT&T Inc. posted earnings that topped estimates, giving investors less reason to fret over lavish free-phone promotions.
* Nasdaq Inc., operator of the technology-heavy stock exchange, posted record revenue that beat analysts’ expectations.
* Mattel Inc. won back the license to produce toys based on Walt Disney Co.’s princesses and the “Frozen” movies.

The latest economic readings showed that sales of new U.S. homes climbed in December to a nine-month high.
Meantime, the merchandise-trade deficit unexpectedly widened to a fresh record as imports continued to rise, outpacing shipments overseas.
On the geopolitical front, the U.S. told its citizens to consider leaving Ukraine now given the continuing tensions with Russia and the “unpredictable” security situation in the Eastern European nation.
Russian Foreign Minister Sergei Lavrov said the Kremlin will respond to any “aggressive” action by the U.S. as an ally of President Vladimir Putin proposed shipping weapons to separatists.
President Joe Biden said he would consider personally sanctioning Putin if he orders an invasion of Ukraine. What to watch this week:
* South African Reserve Bank rate decision Thursday.
* U.S. initial jobless claims, durable goods, GDP Thursday.
* Euro zone economic confidence, consumer confidence Friday.
* U.S. consumer income, University of Michigan consumer sentiment Friday.

Stocks
* The S&P 500 fell 0.1% as of 4:10 p.m. New York time
* The Nasdaq 100 rose 0.2%
* The Dow Jones Industrial Average fell 0.4%
* The MSCI World index was little changed
Currencies
* The Bloomberg Dollar Spot Index rose 0.5%
* The euro fell 0.6% to $1.1238
* The British pound fell 0.3% to $1.3458
* The Japanese yen fell 0.7% to 114.63 per dollar
Bonds
* The yield on 10-year Treasuries advanced 10 basis points to 1.87%
* Germany’s 10-year yield was little changed at -0.07%
* Britain’s 10-year yield advanced three basis points to 1.20%
Commodities
* West Texas Intermediate crude rose 1.7% to $87.06 a barrel
* Gold futures fell 1.9% to $1,819.50 an ounce
–With assistance from Sunil Jagtiani, Namitha Jagadeesh, Vildana Hajric, Peyton Forte and Cecile Gutscher.
Have a nice evening.

Be magnificent!
As ever,

Carolann

Facing it, always facing it, that’s the way to get through.  Face it. –Joseph Conrad, 1857-1924.

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