August 12, 2020 Newsletter

Dear Friends,

Tangents:
1676: King Philip assassinated.
1851: American inventor Isaac Singer patents the sewing machine.

Ferrari Sets Record for Most Expensive Car Ever Sold Online–Bloomberg Pursuits.

Idleness is more valuable than ever.

Travelling back in time. –Bloomberg.

Gray reef sharks form long-lasting social groups, likely for hunting
Great, now we’re jealous of a shark’s social life.-CNN

Jason Farago, a Times art critic, leads a guided tour through his favorite woodblock print by Katsushika Hokusai, the most famous Japanese artist of the 19th century.-The NY Times.

On Aug. 12, 1898, the peace protocol ending the Spanish-American War was signed. Go to article »

And finally, making sense of one of the most baffling animals that ever lived.  Nearly 250 million years ago, a reptile known as Tanystropheus patrolled the shorelines and coves of the Alps. The 20-foot creature had a toothy head and body echoing that of modern monitor lizards, but between them stretched a 9-foot giraffe-like neck.
The question of how Tanystropheus used its ridiculously long neck has puzzled paleontologists for over 100 years. New research shows evidence that its body was primed for aquatic hunting: A skull reconstruction revealed nostrils positioned on the top of the snout, like a crocodile, and long, curved fangs.
The reptiles probably ambushed prey in murky water, lunging forward with its long neck to snap up fish. –The New York Times.
PHOTOS OF THE DAY

Iceland horse raise dust as they run from their stables to a paddock at a stud farm in Wehrheim near Frankfurt, Germany
CREDIT: MICHAEL PROBST/AP

A giant inflatable model of the Moon, left, and the planet Earth, right, exhibited by the Brno Observatory and Planetarium are seen on the Cow’ Hill (Kravi hora) in Brno, Czech Republic
CREDIT: VACLAV SALEK/ CTK PHOTO/ALAMY LIVE NEWS

Sunset evening over the grade 1 listed White Mill Bridge at Sturminster Marshall, Dorest.
CREDIT: RACHEL BAKER/BNPS

Brothers Cian, Connell and Fionn Ryan from Dublin trying our their fishing skills while on staycation in Kinsale, Co. Cork, Ireland
CREDIT: DAVID CREEDON/ALAMY LIVE NEWS
Market Closes for August 12th , 2020 

International Markets

Bonds

Currencies

Commodities

Market Commentary:
On this day in 1920, Charles Ponzi was arrested for financial fraud in Boston after taking in more than $6 million from thousands of investors. He repaid each $1,000 invested with $1,500 just 90 days later—but only by taking more money from newcomers or, as a judge later put it, “robbing Peter to pay Paul.” Such pyramid arrangements were forever afterwards known as “Ponzi schemes.”
Canada
By Aoyon Ashraf
(Bloomberg) — Canadian equity markets advanced, following a rally in U.S. stocks, which briefly surpassed pre-pandemic levels.
The S&P/TSX Composite rose 0.5% in Toronto. Energy was the best-performing sector as oil price closed above a key technical level, buoyed by U.S. energy data that suggest a much-awaited recovery in demand is underway as the summer driving season nears an end.
Meanwhile, Ontario’s deficit will be nearly twice as large as projected in March as the government bolsters measures to cushion the economy from the coronavirus pandemic.
Commodities
* Western Canada Select crude oil traded at a $11.00 discount to West Texas Intermediate
* Spot gold was flat at ~$1,913.08 an ounce
FX/Bonds
* The Canadian dollar rose 0.3% to C$1.3259 per U.S. dollar
* The 10-year government bond yield rose about 3 basis points to 0.602%

By Bloomberg Automation:
(Bloomberg) — The S&P/TSX Composite rose 0.5 percent at 16,575.28 in Toronto. The move follows the previous session’s decrease of 0.7 percent.
Shopify Inc. contributed the most to the index gain, increasing 1.2 percent. ATS Automation Tooling Systems Inc. had the largest increase, rising 13.4 percent.
Today, 129 of 221 shares rose, while 88 fell; 8 of 11 sectors were higher, led by energy stocks.
Insights
* The index advanced 2.1 percent in the past 52 weeks. The MSCI AC Americas Index gained 16 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 up 0.4 percent in the past 5 days and rose 5.5 percent in the past 30 days
* S&P/TSX Composite is trading at a price-to-earnings ratio of 23.9 on a trailing basis and 24.9 times estimated earnings of its members for the coming year
* The index’s dividend yield is 3.1 percent on a trailing 12-month basis
* S&P/TSX Composite’s members have a total market capitalization of C$2.52t
* 30-day price volatility fell to 10.63 percent compared with 10.75 percent in the previous session and the average of 15.11 percent over the past month
================================================================
|Index Points | |
Sector Name | Move | % Change | Adv/Dec
================================================================
Energy | 26.4085| 1.3| 23/1
Financials | 25.2687| 0.5| 15/10
Industrials | 18.5880| 0.9| 21/6
Information Technology | 6.7235| 0.4| 2/7
Materials | 3.3746| 0.1| 26/23
Utilities | 3.2475| 0.4| 10/6
Communication Services | 1.2951| 0.1| 6/1
Health Care | 0.0217| 0.0| 7/2
Consumer Discretionary | -0.4356| -0.1| 6/7
Real Estate | -2.0260| -0.4| 6/21
Consumer Staples | -4.2103| -0.6| 7/4
US
By Vildana Hajric and Claire Ballentine
(Bloomberg) — U.S. stocks briefly surpassed the all-time closing high reached before the coronavirus pandemic, propelled by surging technology shares. The dollar weakened and Treasury yields rose to five-week highs.
The S&P 500 climbed 1.4%, momentarily topping the 3,386.15 level reached on Feb. 19, and capping the more than 50% rally since the market lows in March. The record intraday high of 3,393.52 was set the same day. Ten of the benchmark index’s 11 industry sectors rose Wednesday, led by technology, health care and consumer discretionary shares. The Nasdaq Composite outperformed the S&P as Apple Inc., Microsoft Corp. and Tesla Inc. jumped. In Europe, the Stoxx Europe 600 Index rose for a fourth day.
“The main force that’s been driving markets the last few weeks has really been momentum,” said Kevin Caron, portfolio manager for Washington Crossing. “We’ve got a market that’s focused on the good case outcome for the virus, we’ve got a market that has taken a great deal of comfort in that fiscal policy is going to be there to support an economy through tough times.”
Treasury yields dropped from the highs of the day after the government’s sale of $38 billion in 10-year notes attracted stronger-than-forecast demand. Silver joined gold in rebounding, as investors decided the flight from precious metals driven by advancing bond yields had gone too far.
“It was just a matter of time. Once we hit 3,300, I think everybody knew we’d get to the new record before long,” said Matt Maley, chief market strategist at Miller Tabak + Co. “The question is whether we’ll rally further now that we’ve got it. I think we’ll take a breather now that we’ve reached the new high, which would actually be quite healthy.”
After setting a new peak on Friday above $2,070 an ounce, bullion had since tumbled as much as 10%. Crude futures posted a five-month high in New York trading after an industry report pointed to a third straight weekly drop in American crude stockpiles.
Elsewhere, Europe’s corporate bond spreads narrowed to their tightest since early March, just a few basis points off pre-virus levels, according to a Bloomberg Barclays index.
Here are some key events coming up:
* Earnings include Tencent, Cisco Systems, Swiss Life, Tui AG.
* China releases a slew of data for July on Friday, including industrial production and retail sales.

These are the main moves in markets:
Stocks
*The S&P 500 Index jumped 1.4% to 3,380.35 as of 4:01 p.m. New York time, the highest in about six months on the largest surge in more than five weeks.
*The Dow Jones Industrial Average climbed 1% to 27,976.69, the highest in almost six months.
*The Nasdaq Composite Index climbed 2.1% to 11,012.24, the largest increase in more than three weeks.
*The MSCI All-Country World Index jumped 1.2% to 570.82, the
highest in almost six months on the biggest surge in more than five weeks.
Currencies
*The Bloomberg Dollar Spot Index fell 0.2% to 1,179.14, the largest fall in a week.
*The euro gained 0.4% to $1.1788, the biggest advance in a week.
*The Japanese yen depreciated 0.4% to 106.89 per dollar, the weakest in three weeks.
Bonds
*The yield on 10-year Treasuries climbed two basis points to 0.66%, the highest in more than five weeks.
*Germany’s 10-year yield increased three basis points to -0.45%, the highest in four weeks.
*Britain’s 10-year yield gained four basis points to 0.237%, the highest in almost eight weeks.
Commodities
*West Texas Intermediate crude increased 2.3% to $42.56 a barrel, the highest in about five months on the largest climb in more than three weeks.
*Gold was little changed at $1,911.27 an ounce, the weakest in almost three weeks.
*Copper increased 0.2% to $2.88 a pound.
–With assistance from Michael G. Wilson.
Have a great night.

Be magnificent!
As ever,

Carolann

You don’t need a weather man to know which way the wind blows.
                                                                  -Bob Dylan, b. 1941

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