August 13, 2019 Newsletter

Dear Friends,

Tangents:
On Aug. 13, 1961, Berlin was divided as East Germany sealed off the border between the city’s eastern and western sectors in order to halt the flight of refugees.  Go to article »
PHOTOS OF THE DAY
A view of the Manneken Pis sculpture dresses with a floral creation by Belgian artist Geoffroy Mottart, on the occasion of the ‘Flower Time” event in Brussels, Belgium. Every other summer, in alternation with the Flower Carpet, the City Hall of Brussels and the Grand-Place run the Flower Time international plant and flower arrangement event. The entry hall, the corridors, the offices, meeting and reception rooms of the buildings are adorned with dozens of floral arrangements. The floral creations are created by internationally renowned landscape architects and artists. This year’s event runs from 14 until 18 August.
CREDIT: STEPHANIE LECOCQ/EPA-EFE/REX

 World-famous trials rider Danny MacAskill performing some stunts from his Fringe Debut show in Edinburgh. The Edinburgh Festival Fringe has come top a list of 500 must-do experiences in the UK complied by travel guide Lonely Planet. The festival was voted into first place by seasoned travellers asked to rank their most memorable experiences, beating the British Museum and Giant’s Causeway.
CREDIT: THE TELEGRAPH, AUGUST 13, 2019

Argentina’s Jose Torres competes to win the silver medal in the Cycling BMX Men’s Freestyle Final during the Lima 2019 Pan-American Games in Lima.
CREDIT: THE TELEGRAPH, August 13, 2019
Market Commentary:
On this day in 1979, BusinessWeek’s cover famously proclaimed “The Death of Equities,” citing a Labor Department ruling that allowed pension funds to diversify into other asset classes beyond stocks and bonds, high inflation and the reduction by seven million in the number of shareholders from 1970. 
Canada
By Aoyon Ashraf
(Bloomberg) — Canadian stocks alongside U.S. equities got a big boost Tuesday, erasing yesterday’s losses, after the Trump administration said it will delay tariffs on some Chinese goods until December.
The S&P/TSX Composite Index rose 0.7% to 16,350.84 at the close in Toronto, with ten of the 11 sectors rising. Health care sector was the best performers, led by pot stocks, while materials were the worst, weighed down by precious metal miners.
Meanwhile, the sharp moves by several pot stocks in the final minutes of trading last week may be the result of trades
by the largest cannabis exchange-traded fund. The $1 billion ETFMG Alternative Harvest ETF recently added about 5.5 million shares of CannTrust Holdings Inc., according to holdings data compiled by Bloomberg. The medical cannabis producer jumped about 40% in the last hour of trading on Friday after spending most of the day in the red. Conversely, the fund, known as MJ, has significantly reduced its positions in Auxly Cannabis Group Inc., Vivo Cannabis Inc., Supreme Cannabis Co. and Canopy Rivers Inc., which all fell by at least 13%.
In other moves:
Stocks
* Pot stocks such as Aphria, Cronos, Hexo were among the top performers within the marijuana sector. Cronos was earlier initiating with an overweight rating at Piper on U.S. CBD growth otential
* Diversified miners such as Lundin Mining, NexGen, Teck Resources were among the outperformer as metal prices rose on trade optimism, while gold miners such as Centerra, Detour Gold, Yamana fell with the prices
* Stars Group rose 3.2% after Eight Capital said the sell-off in shares was overdone
Ratings
* ABX CN: Barrick Gold Upgraded to Buy at Argus; PT Set to $22
* CFP CN: Canfor Downgraded to Hold at TD; PT C$16
* CFX CN: Canfor Pulp Products Upgraded to Buy at TD; PT C$13
* CHH CN: Centric Health Downgraded to Hold at Echelon Wealth; PT 20 Cents
* CL CN: Cresco Labs Inc Rated New Overweight at Piper Jaffray
* CL CN: Cresco Labs Inc Rated New Speculative Buy at Echelon Wealth
* EMA CN: Emera Cut on Valuation at BMO Despite Improved EPS Visibility
* GTII CN: Green Thumb Rated New Overweight at Piper Jaffray; PT $13
* GTII CN: Green Thumb Rated New Buy at Echelon Wealth; PT C$24
* LB CN: Laurentian Bank of Canada Upgraded to Neutral at CIBC; PT C$49
* RUF/U CN: Pure Multi-Family REIT Cut to Sector Perform at RBC; PT $7.61
* SCL CN: ShawCor Downgraded to Sector Underperform at Scotiabank; PT C$20
* USA CN: Americas Silver Cut to Hold at Laurentian Bank Securities
Commodities
* Western Canada Select crude oil traded at a $11.00 discount to WTI
* Gold spot price fell 0.5% to $1,503.24 an ounce
FX/Bonds
* The Canadian dollar rose 0.1% to C$1.3225 per U.S. dollar
* The Canada 10-year government bond yield climbed to 1.232%
US
By Jeremy Herron
(Bloomberg) — U.S. stocks halted a two-day slide and Treasuries tumbled after the Trump administration de-escalated
its trade war with China. Oil surged and gold fell.
The S&P 500 Index jumped as much as 2% after trade officials granted a grace period before tariffs take effect on a
broad swath of consumer goods Americans shoppers covet at the holidays. Makers and sellers of consumer electronics, toys and apparel led the advance.
* Apple surged more than 4% to pace gains among hardware makers
* Best Buy rose the most in the S&P 500, while Target added 3%
* Gap and L Brands jumped more than 3%; Hasbro surged
* Soybeans rose 1.5%, oil added 3.8%
* Gold lost more than $50 an ounce from its high

     The trade headlines sparked demand for risk assets that had been under pressure for more than a week as investors grew increasingly concerned the spat with China would slam global growth. President Donald Trump said he delayed the tariffs to spare the Christmas shopping season after his representatives had a “productive” call with China.
“This news creates a lot of this upside volatility,” said Bruce Bittles, chief investment strategist at Robert W. Baird.
“If the news is sustainable and indeed they are moving to a trade agreement, this is a very important development and we can go to new highs.”
Before the trade headlines landed, fresh inflation data showed an unexpectedly hot reading, denting arguments for cutting interest rates and flattening the Treasury yield toward inversion. The spread between two- and 10-year yields hit the narrowest since 2007. The tariff detente did halt the bond rally, pushing the 10-year rate toward 1.7%. Some investors also remained cautious about the prospects for a trade truce as signs of the war’s impact grow. Singapore’s
government cut its forecast for economic growth this year to almost zero. In Europe, Henkel was among the worst-performing stocks after missing quarterly profit estimates, which the detergents maker blamed on the trade conflict and a competitive retail environment.
“It’s an encouraging first steps but it’s difficult to speculate how far it will go,” Peter Jankovskis, co-chief investment officer at Oakbrook Investments. “We’ve certainly gotten into these situations before where the market believed we
were headed toward a deal and then it was derailed by comments from various officials.”
Meanwhile, the situations in Hong Kong and Argentina remained unstable. The South American nation’s peso tumbled anew amid rising concern the nation will default on its debt, while Hong Kong equities slumped after its airport canceled flights for a second day as protesters clashed with police.
Here are some key events coming up:
* Companies releasing results include China’s JD.com, Tencent and Alibaba; Cisco, Walmart and Nvidia of the U.S.; the U.K.’s Prudential; Australia’s Telstra; Europe’s Swisscom and brewer arlsberg.
* Wednesday brings data on China retail sales, industrial production and the jobless rate.
* Thursday sees the release of U.S. jobless claims, industrial production and retail sales data.

These are the main moves in markets:
Stocks
* The S&P 500 Index rose 1.4% as of 4 p.m. New York time.
* The Dow Jones Industrial Average rose 1.2%.
* Nasdaq Composite Index gained 2%, while the Nasdaq 100 Index rose 2.2%.
* The Stoxx Europe 600 Index rose 0.5%.
* The MSCI Asia Pacific Index decreased 1.4%.
* The MSCI Emerging Market Index decreased 0.3%.
Currencies
* The Bloomberg Dollar Spot Index advanced 0.2%.
* The euro fell 0.4% at $1.1174.
* The British pound slipped 0.2% at $1.2057.
* The Japanese yen fell 1.3% to 106.678.
* The Argentine peso slumped 4.8% to 55.55 per dollar.
Bonds
* The yield on 10-year Treasuries rose four basis points to 1.68%.
* The two-year rate rose eight basis points to 1.66%.
* Germany’s 10-year yield fell two basis points to -0.609%.
Commodities
* Gold futures fell 0.1% to $1,515 an ounce.
* West Texas Intermediate crude rose 3.8% to $57.04 a barrel.
–With assistance from Katherine Greifeld, Andreea Papuc, Todd
White and Olivia Rinaldi.
Have a great night.

Be magnificent!
As ever,
Carolann

A wise man will make more opportunities than he finds.
                                -Sir Francis Bacon, 1561-1626

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