April 29, 2013 Newsletter

Dear Friends,

Tangents: Arbor Day today.

Out beyond ideas of wrong-doing and right-doing,

there is a field.  I’ll meet you there.

When the soul lies down in that grass,

the world is too full to talk about.

Ideas, language, even the phrase “each other”

doesn’t make any sense.

-Jalaluddin Rumi

Jerry Seinfeld turns 58 years old today.

Also on this day, in,

1967, Aretha Franklin debuts her single Respect which goes to number one on the pop and R & B charts and earns her 2 Grammys.

1958, Broadway musical My Fair Lady with Julie Andrews opened in London and the first month’s performances were sold out before opening night.

1429, 17-year old Joan of Arc relieves the French forces at Orleans in their battle against the British.

2012, Prince William married Kate Middleton.

Photos of the day – April  29th, 2013

A bee is covered with pollen as it sits on a blade of grass on a lawn in Klosterneuburg. The European Commission said it would go ahead and impose a temporary ban on three of the world’s most widely used pesticides because of fears they harm bees, despite EU governments failing to agree on the issue. Heinz-Peter Bader/Reuters

A man wearing shades displays a t-shirt depicting Dutch Queen Beatrix in a souvenirs shop in Amsterdam. The Netherlands is preparing for Queen’s Day on April 30, which will also mark the abdication of Queen Beatrix and the investiture of her eldest son Willem-Alexander. Cris Toala Olivares/Reuters

Market Closes for April 29th, 2013

International Markets

Bonds

Currencies

Commodities

Market Commentary:

Canada

By Eric Lam

April 29 (Bloomberg) — Canadian stocks rose as commodities from oil to gold rallied amid optimism over central-bank stimulus and data showed U.S. consumer spending climbed more than forecast in March.

Valeant Pharmaceuticals International Inc. gained 3.3 percent as the drugmaker is said to have been in talks to merge with Actavis Inc. Suncor Energy Inc. increased 1.2 percent as crude touched a two-week high. Semafo Inc. and Detour Gold Corp. surged at least 7.7 percent as gold rallied. Endeavour Silver Corp. advanced 1.8 percent after announcing plans to cut costs due to lower metal prices.

The Standard & Poor’s/TSX Composite Index rose 92.47 points, or 0.8 percent, to 12,312.67 at 4 p.m. in Toronto. The benchmark equity gauge has fallen 3.4 percent in April, heading for the biggest monthly drop since May 2012. Trading volume was 37 percent lower than the 30-day average.

“The commodities were all oversold, the TSX is riding the bounce,” said Keith Richards, a fund manager with ValueTrend Wealth Management in Barrie, Ontario. He helps manage about C$100 million ($99 million). “There’s very little in the way of gold reaching $1,550.”

Crude and gold prices advanced on optimism that central banks will decide to maintain economic stimulus in their meetings this week to bolster growth. Economists surveyed by Bloomberg said European Central Bank policy makers may cut interest rates, while the U.S. Federal Reserve will consider renewing its commitment to bond-buying at a two-day meeting starting tomorrow.

Consumer spending in the U.S., the biggest oil-consuming nation, rose more than projected in March, a Commerce Department report showed today.

Energy, financial and raw-materials stocks contributed most to gains in the S&P/TSX as all 10 industries advanced. The S&P/TSX Energy Index rallied 0.9 percent.

Suncor, Canada’s largest oil producer, rose 1.2 percent to C$29.63 and Canadian Natural Resources Ltd. gained 1.3 percent to C$29.96 as oil for June delivery advanced 1.6 percent to settle at $94.50 a barrel in New York, highest since April 10.

Athabasca Oil Corp. rallied 3.8 percent to C$7.42, rebounding from an April 23 record low after a Canadian aboriginal group that has opposed a planned sale of the company’s Dover oil-sands project to Beijing-based PetroChina Co. said the impasse can be overcome.

The Fort McKay First Nation opposes the Dover development in Alberta due to environmental concerns and forced a regulatory hearing to consider the project. Athabasca needs regulatory approval before it can sell its stake to PetroChina for C$1.32 billion in cash.

Endeavour Silver gained 1.8 percent to C$5.19 after announcing a plan to fire workers and defer planned spending to deal with falling precious metals prices.

“It pays to be prudent at times like this,” Bradford Cooke, chief executive officer with Endeavour, said in a statement.

Detour Gold soared 7.8 percent to C$12.22 and Semafo jumped 7.7 percent to C$1.95 as the price of gold gained 0.9 percent to settle at $1,467.40. The metal rallied 4.2 percent last week after gold plunged into a bear market this month.

Valeant Pharmaceuticals, based in Montreal, climbed 3.3 percent to C$76.85. Merger talks with Actavis, the largest generic-drug maker in the U.S., have stalled due to a disagreement over price, according to people familiar with the matter.

The generic-drug makers had sought to announce a deal as soon as today before Actavis balked at the premium offered by Valeant, said one of the people, who asked not to be identified because the discussions aren’t public. While the talks have halted for now, they may become active again, another person said.

US

By Lu Wang and Whitney Kisling

April 29 (Bloomberg) — U.S. stocks rose, with the Standard & Poor’s 500 Index advancing to a record high, as pending sales of homes climbed amid optimism central banks will maintain stimulus plans.

Apple Inc. jumped 3.1 percent to pace a rally in technology shares. Tenet Healthcare Corp. surged 6.5 percent as hospitals will get a pay raise from the U.S. government for treating Medicare patients. Actavis Inc. and Valeant Pharmaceuticals International Inc. rose more than 3.8 percent as the companies are said to have been in merger talks. Moody’s Corp. gained the most in the S&P 500 after being part of a settlement with investors claiming inflated ratings.

The S&P 500 rose 0.7 percent to 1,593.61 at 4 p.m. in New York, topping a record close of 1,593.37 reached on April 11.

The Dow Jones Industrial Average increased 106.20 points, or 0.7 percent, to 14,818.75 today. More than 5.1 billion shares traded hands today on U.S. exchanges, or 19 percent below the three- month average.

“There’s just a positive tone to the market in part because recent lackluster economic trends have reinforced investors belief that the Federal Reserve will continue to press on the gas pedal,” Chad Morganlander, a Florham Park, New Jersey-based fund manager at Stifel Nicolaus & Co., which oversees about $130 billion, said by telephone.

The S&P 500 has climbed 1.6 percent in April, poised for its sixth straight month of gains, the longest streak of advances since September 2009. The bull market in U.S. equities has entered its fifth year as the S&P 500 surged 136 percent from a 12-year low in 2009, driven by better-than-estimated corporate earnings and three rounds of monetary stimulus from the Federal Reserve.

The European Central Bank will cut its benchmark interest rate to a record low of 0.5 percent on May 2, according to the majority of economists in a Bloomberg survey, while the Fed may consider renewing its commitment to bond-buying at a two-day meeting starting tomorrow.

Equities rose today as figures from the National Association of Realtors showed the index of pending home sales increased 1.5 percent after a revised 1 percent decline the prior month that was larger than initially reported. Economists forecast a 1 percent increase, according to the median estimate in a Bloomberg survey.

Separate data showed consumer spending rose more than projected in March. Incomes increased less than forecast and inflation cooled to the lowest level in more than three years.

Nine S&P 500 companies report earnings today, including Express Scripts Holding Co. and Loews Corp. Of the 273 companies that have reported earnings so far this month, 74 percent exceeded analysts’ profit predictions, while 55 percent missed sales estimates, data compiled by Bloomberg show.

“We feel visibility on earnings is pretty darn good,” Paul Mangus, head of equity research and strategy at Wells Fargo Private Bank in Charlotte, North Carolina, said in a phone interview. His firm oversees $170 billion. “We are seeing some indications that earnings momentum is likely to pick up in future quarters.”

The Chicago Board Options Exchange Volatility Index, or VIX, rose 0.7 percent to 13.71. The gauge for options that are used to protect against losses in the S&P 500 reached a six-year low in March and is down 24 percent this year.

All 10 S&P 500 industry groups advanced as technology and commodity companies climbed the most, rising at least 0.9 percent. Apple jumped 3.1 percent, the most since Feb. 5, to $430.12. Microsoft Corp. surged 2.6 percent to $32.61 and Google Inc. increased 2.2 percent to $819.06. Hewlett-Packard Co. added 2.7 percent, the most in the Dow, to $20.50 and International Business Machines Corp. gained 2.5 percent to $199.15.

Tenet, the third-largest U.S. hospital company, jumped 6.5 percent to $43.84. HCA Holdings Inc., the largest publicly traded chain, climbed 5.5 percent to $40.37.

The U.S. Centers for Medicare and Medicaid Services plans to raise payments 0.8 percent beginning Oct. 1 for services that elderly and disabled patients receive after being admitted to hospitals, according to a regulatory proposal.

Moody’s climbed 8.3 percent to $59.69, the highest in almost six years. McGraw-Hill Cos., owner of Standard & Poor’s, advanced 2.8 percent to $53.45. Investors led by Abu Dhabi Commercial Bank and King County, Washington, agreed to drop their lawsuits claiming that the companies gave inflated grades on two structured investment vehicles.

Morgan Stanley rose 3.8 percent to $22.21 after settling claims brought by the investor group that it had acted negligent in conveying ratings that it should have known were inaccurate.

The Bloomberg U.S. Airlines Index rallied 1.1 percent.

United Continental Holdings Inc. increased 2.8 percent to $32 while Delta Air Lines Inc. rose 0.8 percent to $16.95.

The U.S. House passed legislation to end air-traffic controller furloughs, joining the Senate in letting the Federal Aviation Administration work around across-the-board budget cuts to end days of flight delays.

Actavis rose 4.6 percent to $105.58 and Valeant added 3.8 percent to $75.94. The generic-drug makers had sought to announce a merger as soon as today before Actavis balked at the premium offered by Valeant, said a person familiar with the matter, who asked not to be identified because the discussions aren’t public. The Financial Times reported April 27 that the talks had stalled.

Biogen Idec Inc. climbed 4.7 percent to a record $223.61.

The introduction of the company’s multiple sclerosis pill, Tecfidera, outstripped the initial sales of competing drugs from Novartis AG and Sanofi, suggesting the treatment may beat estimates for the year. Total prescriptions more than doubled during the third week of the launch to 730 from 332 the previous week, according to a Wells Fargo & Co. report.

Walt Disney Co. climbed 1.8 percent to $63, a record high.

The world’s largest entertainment company was boosted to buy from neutral by UBS AG.

Conceptus Inc. surged 20 percent to a record $30.96. The maker of a permanent contraception device agreed to be bought by Bayer AG for about $1.1 billion in cash, or $31 a share.

Roper Industries Inc. fell 3.8 percent to $118.68. The maker of products from medical imaging to refrigeration valves forecast second-quarter earnings of no more than $1.30 a share.

That trailed the average analyst estimate of $1.38 in a Bloomberg survey.

Eastman Chemical Co. slipped 1 percent to $68.27 after JPMorgan Chase & Co. cut the stock’s rating to neutral from overweight.

Expedia Inc. declined 4.3 percent, the most in the S&P 500, to $56.06. The stock has slumped 14 percent since lowering its 2013 earnings forecast on April 25, leaving it poised for the biggest two-day drop since 2011.

Have  a wonderful weekend everyone.

Be magnificent!

From Him woman was born; and from Her man was born.

From His mind the moon was born; from His eye the sun was born; from His breath the wind was born.

From His navel the atmosphere was born; from His head the sky was born;

and from His ear the four quarters of the sky were born.

Thus the universe was in order.

Rig Veda

As ever,

Carolann

One can never consent to creep when one feels

an impulse to soar.

–Helen Keller, 1880-1968

Carolann Steinhoff, B.Sc., CFP®, CIM, FCSI

Senior Vice-President &

Senior Investment Advisor

Queensbury Securities Inc.,

St. Andrew’s Square

Suite 340A, 730 View St.,

Victoria, B.C. V8W 3Y7