April 19, 2012 Newsletter

Hello All,

Carolann is still away on business, so it’s my turn to send the newsletter!

Tangents:

As you may have heard already, the iconic host of “New Year’s Rockin’ Eve,” Dick Clark, has passed away at age 82. His career spanned more than 60 years, and he will be greatly missed in the television community. New Years 2013 in Times Square won’t be the same without him!

Check out http://arts.nationalpost.com/2012/04/19/dick-clark-a-career-in-milestones/ for a look at some of his career highlights.

photos of the day

April 19, 2012

A man stands inside the art work “Five Minutes of Pure Sculpture” by British artist Anthony MacCall at the Hamburger Bahnhof museum in Berlin.
Markus Schreiber/AP

A surfer holding his surfboard leaves the water at a beach in the Barranco district of Lima, Peru.
Mariana Bazo/Reuters

Market Closes for April 19, 2012:

North American Markets

International Markets

Bonds

Currencies

Commodities

Market Commentary:

Canada

By Lu Wang and Joanna Ossinger

April 19 (Bloomberg) — Canadian stocks climbed for a second time in three days as mining companies advanced with gold prices and Research In Motion Ltd. rallied on speculation it will hire a financial adviser soon.

Lundin Mining Corp., which produces base metals in Europe, gained 5.8 percent. Novagold Resources Inc. climbed 2 percent, while First Quantum Minerals Ltd. jumped 3.1 percent. Research In Motion rallied 2.6 percent after two people with knowledge of the matter said JPMorgan Chase & Co. was the leading candidate to help the BlackBerry maker weigh strategic options. Manulife Financial Corp. gained 1.9 percent as Desjardins Securities Inc. said the stock has the best potential to rise among insurers.

The Standard & Poor’s/TSX Composite Index advanced 24.80 points, or 0.2 percent, to 12,153.69 at 4 p.m. in Toronto. The gauge is heading for its first weekly gain since February after the Bank of Canada said economic growth will be faster than expected.

“We’re in a general uptrend economically and we do expect that to continue,” Tony Demarin, chief investment officer at BCV Asset Management in Winnipeg, Manitoba, said in a telephone interview. The firm oversees C$360 million ($363 million).

“Canada is a lot more on the resources side. When resources do well, that’s what drives the Canadian market.”

The S&P/TSX had its seventh straight weekly decline in the five days ending April 13, its longest losing streak since 2008, as weaker-than-forecast U.S. jobs numbers and reports of slowing growth in China raised concern that demand may slip for Canadian commodities. The U.S. is the world’s biggest consumer of oil, while China is the No. 1 user of copper.

Copper advanced as much as 0.6 percent, before erasing the gain, as the chief executive officer of Freeport-McMoRan Copper & Gold Inc. said on a conference call that global inventories are relatively low and still facing supply constraints. Gold rose after Christine Lagarde, the managing director of the International Monetary Fund, said she expects the resources of the IMF to be “significantly increased” amid Europe’s sovereign-debt crisis.

Lundin jumped 5.8 percent to C$4.56, and Novagold rose 2 percent to C$6.58. First Quantum added 3.1 percent to C$21.52.

Goldcorp Inc. climbed 1.7 percent to C$41.18.

Research In Motion advanced 2.6 percent to C$13.42. The company’s final choice for a financial adviser hasn’t been made and could come within days, one of the people familiar with the matter said.

Manulife increased 1.9 percent to C$13.47. Shares of Canada’s largest insurer may rally 37 percent from current levels this year as higher bond yields and rising equity market bolster earnings, according to Desjardins.

Alimentation Couche-Tard Inc. fell 2.2 percent to C$38.75.

The convenience store operator’s plan to finance its acquisition of Statoil Fuel & Retail ASA with floating rate debt is “not prudent” over the longer term, Peter Sklar, an analyst with BMO Capital Markets, said in a note to clients. He cut his rating on Alimentation to market perform from outperform. The market perform rating means the stock is expected to perform roughly in line with the market.

SXC Health Solutions Corp. rose the most in the S&P/TSX, jumping 8.9 percent to C$96.49. The provider of pharmacy benefit management services and health-care information technology will stay listed on the Toronto Stock Exchange after agreeing to buy Catalyst Health Solutions Inc. to expand in the U.S., the Globe and Mail reported, citing an interview with Chief Financial Officer Jeff Park.

US

By Nikolaj Gammeltoft and Michael P. Regan

April 19 (Bloomberg) — U.S. stocks fell for a second day as data on manufacturing, home sales and jobless claims tempered optimism in the economy, overshadowing improving earnings.

Spanish and French bonds slid; Treasuries and commodities rose.

The Standard & Poor’s 500 Index slipped 0.3 percent to 1,381.72 at 12:22 p.m. in New York after rising as much as 0.4 percent. The Stoxx Europe 600 Index fell 0.5 percent, erasing an earlier 1 percent rally. The S&P GSCI gauge of commodities rose

0.3 percent as crops led gains. Ten-year Treasury yields lost two basis points to 1.96 percent as rates on French and Spanish 10-year bonds climbed at least eight basis points, reviving concern about Europe’s debt crisis.

U.S. reports today showed existing-home sales unexpectedly fell 2.6 percent, the Federal Reserve Bank of Philadelphia’s manufacturing index trailed estimates and jobless claims exceeded projections. Morgan Stanley and Bank of America Corp.

reported earnings were boosted by higher trading revenue, while Ebay surged as its PayPal payments service fueled profit growth.

“You’ve got a lot of counter-balancing points,” Philip Orlando, the New York-based chief equity strategist at Federated Investors Inc., which oversees about $370 billion, said in a phone interview. “The jobless claims number was disappointing, while corporate earnings have been coming in stronger than expected,” he said. “Investors are looking at each incremental data point trying to draw conclusions.”

Industrial and consumer-discretionary stocks led losses in the 10 main S&P 500 industry groups, while telephone and health- care companies rose the most. The Philadelphia Fed’s general economic index decreased to 8.5 in April, the lowest level since January and less than the median forecast of economists for a reading of 12. The Labor Department reported initial jobless claims of 386,000 last week, topping the median estimate of 370,000.

EBay rallied 15 percent after sales and profit at the world’s largest Internet marketplace topped analysts’ estimates, spurred by growth in its PayPal online-payments business.

Verizon climbed 2.3 percent as smartphone demand boosted subscriber count. Qualcomm Inc., the biggest maker of mobile- phone semiconductors, declined 5.2 percent as its third-quarter forecasts fell short of some projections on increased spending to bolster chip output.

Profits for S&P 500 companies are forecast to rise 1.7 percent in the first quarter and 2 percent in the following period, according to analysts’ estimates compiled by Bloomberg.

Corn and wheat climbed more than 2 percent to lead gains in 18 of 24 commodities tracked by the S&P GSCI Index, which climbed 0.3 percent. Oil swung between gains and losses near $102.67 a barrel.

Among European stocks, Publicis Groupe SA dropped as France’s largest advertising company said growth will slow this quarter. GlaxoSmithKline Plc advanced after Human Genome Sciences Inc. rejected an unsolicited offer from the U.K.’s largest drugmaker. SKF AB, the world’s biggest maker of ball bearings, rose 4.9 percent after forecasting higher sales in the U.S. and Asia.

Spain’s 10-year bond yield increased 10 basis points, or 0.10 percentage point, to 5.93 percent and France’s yield added eight basis points to 3.10 percent. The French rate increased to 140 basis points above yields on benchmark German bunds, the highest level since January.

Spain sold 2.54 billion euros ($3.3 billion) of two-year and 10-year debt today, compared with a maximum target of 2.5 billion euros, and France auctioned 8 billion euros.

Spain sold the 10-year benchmark bonds at an average yield of 5.743 percent, compared with 5.789 percent on the secondary market before the auction, and 5.403 percent when it last sold the debt in January. It auctioned two-year securities at 3.463 percent. France issued 2.7 billion euros of benchmark five-year securities at an average yield of 1.83 percent, up from 1.78 percent on March 15.

Credit-rating companies will probably downgrade France over the next two to three years regardless of whether President Nicolas Sarkozy or his Socialist challenger, Francois Hollande, wins the election, Citigroup Inc. economist Michael Saunders wrote in a client note today. The nation may be cut one level by both S&P and Moody’s Investors Service, he wrote. Italy, Spain, Ireland and Portugal also face potential downgrades, he wrote.

Christine Lagarde, managing director of the International Monetary Fund, says she hopes to raise more than $320 billion in additional lending resources. That figure is not the “final ask,” she said in a Bloomberg Television interview today, adding that she expects countries to announce additional contributions.

In Asia, Hong Kong’s Hang Seng Index advanced 1 percent.

China will boost liquidity by cutting reserve requirement ratios if necessary, Xinhua News Agency said, citing an unidentified central bank official. The nation may also increase open market operations including reverse repurchase agreements and redemption of central bank bills, the report said.

The yen weakened against 14 of 16 major peers as Bank of Japan Governor Masaaki Shirakawa pledged to continue monetary easing. Growth in developed economies remains “anemic,” Shirakawa said yesterday in New York.

The MSCI Emerging Markets was little changed. Russia’s Micex Index gained 1.8 percent as steelmaker OAO Severstal jumped 5.7 percent after fourth-quarter profit beat estimates.

The benchmark index in South Africa rose 0.2 percent as retail sales exceeded forecasts and the inflation rate slipped.

Have a wonderful evening everyone.

Kind regards,

Nadia Aziz

Assistant to Carolann Steinhoff

Queensbury Securities Inc.,

St. Andrew’s Square

Suite 340A, 730 View St.,

Victoria, B.C. V8X 3Y7