August 15, 2022 Newsletter

Dear Friends,

Tangents: Happy Monday.
August 15, 2001: Astronomers announced the discovery of the first solar system outside our own – two planets orbiting a star in the Big Dipper.  Go to article »
August 15, 2019: Disney Studios becomes the record holder fort the most billion dollar movies in a single year when “Toy Story 4” crossed the $1 billion mark at the global box office joining “Avengers: Endgame”, “Captain Marvel”, “Aladdin” and “The Lion King”.

Napoleon Bonaparte, b. 1769.
T.E. Lawrence, writer, b. 1888.
Julia Child, b. 1912.

Archaeologists dug up a 15th-century kitchen.

Why you should own more books than you can read.

Why humans gesture.

Giant asteroid impacts may have created the continents.

PHOTOS OF THE DAY

Athletes start the swim section of Ironman Ireland in Cork
CREDIT: Nigel Roddis/Getty Images for Ironman

A competitor in the annual international waterfall jumping competition held in the old town
CREDIT: Dado Ruvić/Reuters

Pre-professional Chautauqua dancers perform ballet at the amphitheatre of the Chautauqua Institution.
CREDIT: Tayfun Coskun/Anadolu Agency/Getty Images
Market Closes for August 15^th, 2022

International Markets

Bonds

Currencies

Commodities

Market Commentary:
On this day in 1971, alarmed at inflation, which was running at roughly a 4.5% annual rate, President Richard Nixon issued an executive order declaring a 90-day freeze on wages and prices. Within three years, inflation was at a record 12.2% and the nation was in the worst recession since 1929.
Canada
By Bloomberg Automation
(Bloomberg) — The S&P/TSX Composite advanced slightly to 20,180.60 in Toronto.
Toronto-Dominion Bank contributed the most to the index gain, increasing 0.8%. Canopy Growth Corp. had the largest increase, rising 17.2%.
Today, 98 of 238 shares rose, while 135 fell; 9 of 11 sectors were higher, led by financials stocks.
Insights
* The index declined 1.6% in the past 52 weeks. The MSCI AC Americas Index lost 5.7% in the same period
* The S&P/TSX Composite is 9.1% below its 52-week high on April 5, 2022 and 11.1% above its low on July 14, 2022
* The S&P/TSX Composite is up 2.6% in the past 5 days and rose 9.7% in the past 30 days
* S&P/TSX Composite is trading at a price-to-earnings ratio of 13.6 on a trailing basis and 12.5 times estimated earnings of its members for the coming year
* The index’s dividend yield is 3% on a trailing 12-month basis
* S&P/TSX Composite’s members have a total market capitalization of C$3.23t
* 30-day price volatility fell to 14.66% compared with 14.78% in the previous session and the average of 17.48% over the past month
================================================================
| Index Points | |
Sector Name | Move | % Change | Adv/Dec
================================================================
* Financials | 25.2756| 0.4| 16/12
* Industrials | 13.3500| 0.5| 21/8
* Consumer Discretionary | 7.5778| 1.1| 8/5
* Consumer Staples | 5.5311| 0.7| 7/3
* Information Technology | 5.4713| 0.5| 11/3
* Utilities | 5.2602| 0.5| 12/4
* Health Care | 3.6678| 4.9| 5/2
* Communication Services | 1.6523| 0.2| 2/5
* Real Estate | 0.0954| 0.0| 7/15
* Materials | -26.6840| -1.2| 5/44
* Energy | -40.4088| -1.1| 4/34
================================================================
| | |Volume VS | YTD
| Index | | 20D AVG | Change
Top Contributors |Points Move| % Change | (%) | (%)
================================================================
* TD Bank | 8.5170| 0.8| -23.5| -10.2
* Bank of Nova Scotia | 6.0550| 0.9| 4.1| -9.4
* Constellation Software | 5.3590| 1.8| -21.0| -6.7
* Enbridge | -5.4430| -0.7| 149.7| 11.6
* Nutrien | -9.6430| -2.2| -25.5| 21.3
* Canadian Natural Resources | -9.6990| -1.7| 45.2| 32.2
US
By Stephen Kirkland and Vildana Hajric
(Bloomberg) — US stocks rose for a second day in a row, with megacaps catching bids as investors digested weak data on New York manufacturing and the Chinese economy.
Treasuries gained with the dollar, while commodities from oil to iron ore tumbled.
The S&P 500 closed near highs of the day, reversing losses of as much as 0.5%, with only energy and materials sectors ending in the red.
The tech-heavy Nasdaq 100 outperformed, with Tesla Inc., Apple Inc., Microsoft Corp. and Nvidia Corp. leading gains.
Treasury yields declined and the bond curve remained deeply inverted, pointing to potential risks of a US recession as the Federal Reserve tightens monetary policy.
US stocks are coming off a fourth straight weekly gain, the longest run this year, with sentiment buoyed by signs of slowing price pressures that stirred hopes of a shift by the Fed to less aggressive rate hikes and a gradual slowdown in the economy.
Still, the rally has left market breadth looking stretched with stocks vulnerable to a pullback.
“The magnitude of this bear market rally has surprised many, including us,” Morgan Stanley strategists including Michael Wilson wrote in a note. “In our view, it’s been driven by a combination of better-than-feared 2Q earnings (although revisions/price came down into the quarter), light positioning and continued hope for a less hawkish Fed path.”
In corporate news, activist investor Dan Loeb said he acquired a stake in Walt Disney Co. and called for sweeping changes.
The shares rose for a fourth day to the highest since April.
Big-box retailers take center stage this week with Walmart Inc., Home Depot Inc. and Target Corp. due to report earnings.
“Traders seemingly embraced the downtick in inflation last week and pushed stocks to their highest levels since early May,” Chris Larkin, managing director of trading at E*TRADE from Morgan Stanley, said in a note. “Though with inflation still unsustainably high, and the Fed needing to continue to hike interest rates, the possibility of an inflation ‘head fake’ after last week’s data remains.”
A gauge of New York state manufacturing activity plunged by the second-most in data back to 2001, with sharp declines in orders and shipments indicating an abrupt downturn in demand, a report showed Monday.
Meanwhile, data showed China’s July retail sales, investment and industrial output missed economists’ estimates, and in the euro area, the risk of a recession has reached the highest level since November 2020, according to economists polled by Bloomberg.
Oil shed more than 3%, while iron ore, copper and other metals declined amid mounting concerns that China’s sluggish recovery will curb demand for raw materials.
Gold retreated below $1,800 an ounce and Bitcoin hovered above $24,000.
“We would caution investors not to get too bulled up or chase this rally,” Solita Marcelli, chief investment officer Americas at UBS Global Wealth Management, said. “There is a decent risk that the Fed has to hike rates more than we and the market are currently expecting, a possibility that would quickly cool the warming sentiment. That would also increase downside risks to growth, which are already prevalent.”
Here are some key events to watch this week:
* Earnings include Walmart, Target, Home Depot, Tencent
* Federal Reserve July minutes, Wednesday
* New Zealand rate decision, Wednesday
* UK CPI, US retail sales, Wednesday
* Australia unemployment, Thursday
* U.S. existing home sales, initial jobless claims, Conference Board leading index, Thursday
* Fed’s Esther George, Neel Kashkari speak at separate events, Thursday

Some of the main moves in markets:
Stocks
* The S&P 500 rose 0.4% as of 4 p.m. New York time
* The Nasdaq 100 rose 0.7%
* The Dow Jones Industrial Average rose 0.4%
* The MSCI World index rose 0.2%
Currencies
* The Bloomberg Dollar Spot Index rose 0.7%
* The euro fell 1% to $1.0159
* The British pound fell 0.7% to $1.2054
* The Japanese yen was little changed at 133.30 per dollar
Bonds
* The yield on 10-year Treasuries declined three basis points to 2.80%
* Germany’s 10-year yield declined nine basis points to 0.90%
* Britain’s 10-year yield declined nine basis points to 2.02%
Commodities
* West Texas Intermediate crude fell 3.4% to $88.97 a barrel
* Gold futures fell 1.2% to $1,794.30 an ounce
–With assistance from Andreea Papuc, Michael Msika, Tassia Sipahutar, Brett Miller, Sunil Jagtiani, Robert Brand and Lu Wang.

Have a lovely evening.

Be magnificent!
As ever,

Carolann

We delight in the beauty of the butterfly, but rarely admit the changes it has gone through to achieve that beauty. –Maya Angelou, 1928-2014.

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