April 2, 2025, Newsletter

Dear Friends,

Tangents:
April 2, 1513: Juan Ponce de Leon reaches Florida.
April 2, 1792: the U.S. dollar is introduced via the Mint Act.  Other proposed names for the dollar were the “Unit” and the “Eagle”.
April 2, 2011 Highly radioactive water leaked into the sea from a crack at Japan’s stricken nuclear power plant. Go to article.

Casanova, b. 1725.
Hans Christian Andersen, author, b. 1805.
Emile Zola, writer, b. 1840.
Emmylou Harris, singer, b. 1947.

Scientists discover major differences in how humans and AI ‘think’ — and the implications could be significant
Study finds that AI fundamentally lacks the human capability to make creative mental connections, raising warning signs for how we deploy AI tools. Read More.

3-year-old picks up ‘beautiful stone,’ discovers 3,800-year-old scarab amulet in Israel
A 3-year-old girl in Israel found an ancient Canaanite amulet shaped like a scarab while she was out walking with her family. Read More.

‘We didn’t expect to find such a beautiful, thriving ecosystem’: Hidden world of life discovered beneath Antarctic iceberg
The newfound ecosystem is filled with sea crabs, octopuses and gigantic sponges, suggesting it may have been thriving for centuries. Read More.

Lava bursts through Grindavík’s defense barriers as new volcanic eruption begins on Iceland’s Reykjanes Peninsula
A volcanic fissure has opened up near the town of Grindavík on Iceland’s Reykjanes Peninsula following a significant uptick in earthquake activity. Read More.

Watch eerie ‘UFOs’ and a solar ‘cyclone’ take shape in stunning new ESA video of the sun
An eerie new video from ESA’s Solar Orbiter shows a towering “cyclone” of plasma exhibiting behaviors never seen before on our sun. Read More.

‘Farewell, junk food!’
In an effort to fight child obesity, Mexico has banned the sale of salty and sweet treats in schools. The ban also requires schools to serve more nutritious fare and offer water as a drink option. Will other countries follow suit?

Big changes coming to the NFL
The NFL announced its latest updates to the game for the 2025 season, including kickoffs, overtime, how the ball is spotted and instant replay. But a decision on banning the so-called “tush push” play has been tabled for now.

Beatles biopic series casts its Fab 4
Director Sam Mendes is planning to make four feature-length biopics that will chronicle the story of The Beatles, as told through each of its members. Here’s who’s going to play John Lennon, Paul McCartney, Ringo Starr and George Harrison.

A POEM THAT I WROTE IN A HIGH FEVER
–by Yehuda Amichai
(Translated from Hebrew by Leon Wieseltier)

You who are lengthening your lives  with the best doctors and the best medicines remember those who are shortening their lives with the wars that you in your long lives are not preventing.

You who are again screwing the younger generations and winking at each other the winking of your eyelids is like the chill of the swinging shutters in an empty house.

PHOTOS OF THE DAY

Wonosobo, Indonesia
Hot-air balloons in the air during the annual hot-air balloon festival, held since 1950 to celebrate Eid al-Fitr, the Islamic holiday marking the end of Ramadan, in Central Java
Photograph: Devi Rahman/AFP/Getty Images

Glenelg, UK
The Glenachulish ferry crosses between Glenelg and Kylerhea in Scotland. The ferry crossing between the Scottish mainland and the Isle of Skye has been in operation since 1934, earning it a ‘Red Wheel’ designation from the National Transport Trust in 2019, for sites of important transport heritage. The service runs between April and October and can carry up to 40,000 people each season
Photograph: Jeff J Mitchell/Getty Images

​​​​​​​Sydney, Australia
A surfer dismounts a wave off the Fairy Bower headland at Manly Beach. The large swell has been generated by a strong low-pressure system moving down the east coast of Australia
Photograph: Cameron Spencer/Getty Images
Market Closes for April 2^nd, 2025

International Markets

Bonds

Currencies

Commodities

Market Commentary:
There is no wealth but life. –John Ruskin, 1819-1900.
Canada
By Bloomberg Automation
(Bloomberg) — The S&P/TSX Composite rose 1.1%, with nine of 11 sectors higher, led by information technology stocks.
As of market close, 137 of 218 stocks rose, while 77 fell.
Superior Plus Corp. led the advances, rising 8.1%, while BlackBerry Ltd. decreased 9.2%.
US
By Rita Nazareth, Denitsa Tsekova and Isabelle Lee
(Bloomberg) — A tariff offensive Donald Trump billed as key to America’s long-term prosperity went down badly in markets late Wednesday, setting off declines of 2% or more in equity benchmarks that had rallied for three days on hopes the program would be less draconian.
A $577 billion exchange-traded fund tracking the S&P 500 (SPY) fell about almost 2.5% after the close of regular trading – wiping out an initial rally.
Trump said Wednesday he will apply a minimum 10% tariff on all exporters to the US and slap additional duties on around 60 nations with the largest trade imbalances with the US.
China will face a 34% rate, while the European Union will have a 20% levy and Japan is seeing a 24% tariff.
The late-session swoon halted three days of gains in the S&P 500 as hopes were dashed the tariff program would be lighter touch.
Traders across asset classes now must brace for what promises to be a grueling stretch of trade negotiations, against an economic backdrop that has shown signs of softening as companies and consumers adjust to Trump’s offensive.
“That should slow trade and raise prices squeezing profit margins,” said Michael O’Rourke at Jones Trading Institutional Services.
“This will further slow a decelerating economy as it creates friction and distortion in global trade.
I think we need to expect retaliation which will likely lead to further escalation.”
To Steve Chiavarone at Federated Hermes, if Wednesday’s announcement marks the most draconian levels of tariffs, and the news flow from here is about how countries are negotiating reductions to these rates, that could be good for markets.
“This may create enough of a sell-off over the next day or so that it creates a buying opportunity,” he said.
“Worst case scenario today would’ve been a low rate with threats of escalation.
I’d rather, at this point, have higher rates with the potential to deescalate.”
In regular hours, the S&P 500 rose 0.7%.
The Nasdaq 100 added 0.7%.
The Dow Jones Industrial Average gained 0.6%.
Tesla Inc. jumped 5.3% on hopes Elon Musk will refocus on the carmaker as a news report suggested his time as a top adviser to Trump may end soon.
On an X post, Musk referred to the article as “fake news.”
Amazon.com Inc. was said to make a bid for TikTok in the US.
The US 10-year yield advanced four basis points to 4.21%.
The dollar fell 0.2%.
How US Tariffs Work — and Who Foots the Bill: QuickTake Options traders are betting that the S&P 500 will move roughly 1.1% in either direction on Thursday based on the price of at-the-money straddles, according to Stuart Kaiser, Citigroup Inc.’s head of US equity trading strategy.
“We believe uncertainty will linger for at least a few months and the focus will shift to the US economic outlook while markets remain hyper-sensitive to any news flow,” said Chris Senyek at Wolfe Research.
Rather than trying to read the tea leaves and adjust investments based off of what’s going on in Washington, David Bahnsen at The Bahnsen Group says he’s focused on investing in companies that have superior cash flow generation during all seasons — and not just seasons when we’re worried about tariffs.
“Companies that are committed to growing their dividend tend to do so for a very long time,” according to Bahnsen.
Meantime, Corporate America last month announced the fewest stock buybacks, in dollar terms, since the Covid pandemic, an early sign of cash hoarding from worries about economic growth and the impact of a global trade war.
The value of announced buybacks in the US reached $39.1 billion in March, the lowest dollar value since October 2020 and the lowest for March since 2019, according to data compiled by Birinyi Associates.
That’s a worrisome sign for investors since buybacks offer a crucial pillar of support for the US stock market, which is already down significantly from February’s all- time highs.
The mood among market participants is among the grimmest since the pandemic, according to JPMorgan Chase & Co.’s Ilan Benhamou, but he still sees a case for US equities to rally.
Benhamou, in the bank’s equity derivatives sales team, said it’s hard to not be more bearish in the face of a slowing economy, rising recession odds, mounting earnings revisions and falling equities price targets.
Still, he writes that “when everything looks grim that the fiercest bounces usually happen.”
Investors are eager for clarity on the scope of the levies to assess their impact on the already wobbly US economy.
Fears that a trade war will dampen consumer sentiment and require more interest-rate cuts from the Federal Reserve to support activity have pushed yields lower in the past weeks.
Options traders are betting that Treasuries will extend their rally, as seen in big wagers on lower yields and expectations of deeper-than-expected Fed cuts reflected in interest rate-linked derivatives.
A similarly bullish narrative is playing out in the Treasury cash market, with this week’s survey of JPMorgan Chase & Co.
client positions showing that the level of net longs is at its highest in a month.
And an increasingly dovish outlook on rates is evident in recent options activity linked to the Secured Overnight Financing Rate, which closely tracks the Fed’s policy rate.
A top-performing Invesco Ltd. money manager has beefed up her bearish bets against the dollar to the highest level in months on expectations that Trump’s tariffs will dent US growth.
“Our biggest concern is that this actually can be a really big, dollar negative story,” said Kristina Campmany, a senior portfolio manager at Invesco.
“From the get-go, we have been more concerned about the growth-negative impact of tariffs.”
In the derivatives market, hedge funds have sharply cut long dollar wagers from a recent peak in January but remain bullish on the US currency, according to positioning data published by the Commodity Futures Trading Commission.

Some of the main moves in markets:
Stocks
* The S&P 500 rose 0.7% as of 4 p.m. New York time
* The Nasdaq 100 rose 0.7%
* The Dow Jones Industrial Average rose 0.6%
* The MSCI World Index rose 0.5%
* Bloomberg Magnificent 7 Total Return Index rose 1%
* The Russell 2000 Index rose 1.6%
Currencies
* The Bloomberg Dollar Spot Index fell 0.2%
* The euro rose 0.5% to $1.0850
* The British pound rose 0.5% to $1.2982
* The Japanese yen fell 0.3% to 150.02 per dollar
Cryptocurrencies
* Bitcoin rose 1.8% to $86,806.6
* Ether fell 0.1% to $1,910.46
Bonds
* The yield on 10-year Treasuries advanced four basis points to 4.21%
* Germany’s 10-year yield advanced three basis points to 2.72%
* Britain’s 10-year yield was little changed at 4.64%
Commodities
* West Texas Intermediate crude rose 0.9% to $71.83 a barrel
* Spot gold rose 0.4% to $3,124.67 an ounce

Have a lovely evening.

Be magnificent!
As ever,

Carolann
Ignorance is not innocence but sin. –Robert Browning, 1812-1889.

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 (Text Only)
Toll Free: 1.877.430.5895
Fax: 778.430.5828
www.carolannsteinhoff.com