August 25, 2023, Newsletter

Dear Friends,

Tangents: Happy Friday.
On Aug. 25, 1944, Paris was liberated by Allied forces after four years of Nazi occupation.  Go to article >>

August 25, 1958: Momofuku Ando markets the first package of precooked instant noodles (Chikin Ramen).

1939: Wizard of Oz released.

Leonard Bernstein, composer, b.  1918.
Claudia Schiffer, model, b. 1970.
Elvis Costell0, b.1954.

Rare ‘blue supermoon’ – the biggest and brightest full moon of the year – rises Aug. 30.
The closest, brightest full moon of 2023 is also the second full moon in August. Here’s how to see it. Read More.

Fukushima nuclear power plant is now pumping wastewater into the Pacific Ocean
The International Atomic Energy Agency has said the release meets international safety standards with a “negligible radiological impact.” Read More.

Mass die-off strikes endangered emperor penguin chicks across 4 of 5 West Antarctica colonies
Out of five known emperor penguin colonies in the Bellingshausen Sea region, four have failed to breed this year as chicks likely drowned in the melting sea ice. Read More.

A ‘forgotten’ Winnie the Pooh sketch sat in a drawer for years. Now it could be worth thousands.  An original drawing of the Disney character which languished for decades in a drawer could fetch nearly $40,000 at auction next month.

It’s not pumpkin you’re tasting in your pumpkin spice latte.  Pumpkin spice blend is actually a simple combination of cinnamon, ginger, nutmeg, allspice and cloves. Check out these fall-favorite dishes that call for real pumpkin.

PHOTOS OF THE DAY

​​​​​​​Espirito Santo state, Brazil
A mother humpback whale and calf are seen next to a boat used by scientists from Jubarte Lab to monitor them on the coast of Vitoria.  Photograph: Carl de Souza/AFP/Getty Images

St Paul, Minnesota
Indigenous leaders and their water-protector allies set up an Occupy-style camp on the lawn of the Minnesota State Capitol building. They are protesting against the Canadian oil and gas transport company Enbridge, which is expanding the controversial Line 3 pipeline. The $9.3bn project will carry oil through treaty-protected tribal lands and through parts of the States watershed
Photograph: Pacific Press/LightRocket/Getty Images

The week in wildlife
A green turtle hatchling makes its way to the sea at the Akyatan lagoon in Turkey
Photograph: Anadolu Agency/Getty Images
Market Closes for August 25^th, 2023

International Markets

Bonds

Currencies

Commodities

Market Commentary:
📈 On this day in 2000, an Internet Wire bulletin said the SEC was investigating Emulex’s accounting practices, promptly knocking billions off Emulex’s market value. The SEC later nailed a former Internet Wire employee, who was short-selling Emulex stock, for securities fraud.
Canada
By Bloomberg Automation
(Bloomberg) — The S&P/TSX Composite rose 0.3% at 19,835.75 n Toronto.
The move follows the previous session’s decrease of 0.5%.
Canadian Natural Resources Ltd. contributed the most to the index gain, increasing 1.6%.
BlackBerry Ltd. had the largest increase, rising 17.4%.
Today, 151 of 227 shares rose, while 74 fell; 9 of 11 sectors were higher, led by energy stocks.
Insights
* This month, the index fell 3.8%
* So far this week, the index was little changed
* The index declined 1.7% in the past 52 weeks. The MSCI AC Americas Index gained 4.2% in the same period
* The S&P/TSX Composite is 4.8% below its 52-week high on Feb. 2, 2023 and 11% above its low on Oct. 13, 2022
* S&P/TSX Composite is trading at a price-to-earnings ratio of 14.9 on a trailing basis and 14 times estimated earnings of its members for the coming year
* The index’s dividend yield is 3.4% on a trailing 12-month basis
* S&P/TSX Composite’s members have a total market capitalization of C$3.13t
* 30-day price volatility rose to 10.52% compared with 10.46% in the previous session and the average of 10.74% over the past month
================================================================
| Index Points | |
Sector Name | Move | % Change | Adv/Dec
================================================================
Energy | 44.1421| 1.3| 39/1
Industrials | 20.1633| 0.7| 20/5
Information Technology | 12.1021| 0.8| 9/2
Consumer Staples | 5.8424| 0.7| 10/1
Real Estate | 3.3648| 0.7| 18/3
Consumer Discretionary | 1.6161| 0.2| 8/6
Communication Services | 1.3065| 0.2| 4/1
Health Care | 1.1453| 1.9| 4/0
Utilities | 0.5787| 0.1| 10/6
Materials | -7.7508| -0.3| 15/35
Financials | -22.5832| -0.4| 14/14
================================================================
| | |Volume VS| YTD
|Index Points | | 20D AVG | Change
Top Contributors | Move | % Change | (%) | (%)
================================================================
Canadian Natural Resources | 9.6700| 1.6| -32.0| 10.1
Enbridge | 5.8110| 0.9| -47.9| -11.5
Canadian National | 5.3410| 0.8| -18.4| -4.9
National Bank of Canada | -2.8840| -1.2| 5.2| 7.6
TD Bank | -3.8440| -0.4| 54.0| -8.3
RBC | -15.5700| -1.3| -46.9| -4.9
US
By Rita Nazareth
(Bloomberg) — Stocks rose as traders sifted through a raft of remarks from Federal Reserve speakers, with Jerome Powell saying officials “will proceed carefully” on whether to raise interest rates again, while signaling policy will remain tighter for longer.
The S&P 500 notched its best week since July.
The yield on 10-year Treasuries fluctuated near 4.2%.
The dollar was little changed.
The euro failed to gain traction after Christine Lagarde said the European Central Bank will set borrowing costs as high as needed and leave them there for as long as it takes to bring inflation back to its goal.
Powell cautioned that the process of bringing inflation back to its target “still has a long way to go.”
In a speech Friday at the US central bank’s annual conference in Jackson Hole, Wyoming, the Fed’s chief also suggested officials could hold rates steady in September, as investors expect.
“Powell, as has been the case for some time, didn’t offer markets anything revelatory today — which was likely the goal,” said Tom Garretson, senior portfolio strategist at RBC Wealth Management. “The market reaction looks consistent with the idea that the Fed is likely done raising rates over the near term, but still stands more than ready to do more if economic data dictates it.”
Fed Bank of Philadelphia President Patrick Harker signaled he favored holding rates at current levels to allow the effects of cumulative tightening to work through the system.
His Cleveland counterpart Loretta Mester noted that under-tightening interest rates would be “a worse mistake” than raising them too much.
Fed Bank of Chicago head Austan Goolsbee said the Fed is part of the way down the road to a soft landing.

More Comments on Jackson Hole:
* Neil Dutta at Renaissance Macro Research:  “I thought Powell has delivered a neutral speech. The Fed sees its monetary policy stance as restrictive and will take a more tempered approach to future meetings. Thus, I think it is quite likely that the Fed does not move in either September or November. If, and this is a big if, they deliver on the hike currently in the dots, it will be December.”
* Michael Feroli at JPMorgan:  “No alarms and no surprises. After these remarks we still think the Fed is on extended hold, though with a risk they hike next month if the data between now and Sept. 20 come in hot.”
* Ronald Temple at Lazard:  “Powell’s speech today should give investors confidence that rate hikes are likely over, absent an unexpected resurgence of inflation. The commentary was largely in line with
expectations. While noting that it will take time before the Fed can be certain inflation and expectations thereof are safely anchored at 2% and suggesting that there are situations that could trigger additional rate hikes, Powell was also careful not to signal imminent additional tightening measures.”
* David Russell at TradeStation:  “He gave some hope to the dovish side by acknowledging that current policy is restrictive and it may work further over time.  But he also threatened to drop the hammer
again if the economy and job market run too hot. We’ll be living number to number for a while here.”
* Steve Sosnick at Interactive Brokers:  “It’s what I expected – a reminder that since we’re above their inflation target, hikes remain on the table, and don’t expect cuts anytime soon. Not much new.”
* Chris Zaccarelli at Independent Advisor Alliance:  “As expected, the Fed chair preserved maximum flexibility by not saying whether the Fed was done raising rates or whether there was at least one more rate hike coming down the pike. We expect that if inflation continues on its current path, then the Fed will hold rates where they are and the economy will stay out of recession (at least for this year), the bull market will  resume, and we will end the year higher from here.”
* Gary Pzegeo at CIBC Private Wealth US:  “No real surprises from Jerome Powell today. It is a very different environment than a year ago when Powell saw a much larger disconnect between the Fed’s expectations and the bond markets’ pricing. Powell didn’t add much in the way of new information, but he did reiterate that the Fed will ‘keep at it until the job is done’.” 
* Ryan Detrick at Carson Group:  “Given the jump in yields lately, he wasn’t as hawkish as some had feared. Remember, last year he took out the bazooka and was way more hawkish than anyone expected, which saw heavy selling into October. This time he hit it more down the middle, with no major changes in future hikes a welcome sign.”
* Quincy Krosby at LPL Financial:  “Powell stands by his standard retort: inflation easing, but too soon to declare victory.”

Corporate Highlights
* Boeing Co. is preparing to restart delivery of 737 Max jets to China for the first time in four years, according to people familiar with the matter, a long-awaited breakthrough that would bolster the plane maker’s comeback from one of the worst crises in its history.
* Instacart has joined chip designer Arm Holdings Ltd. in moving ahead with an initial public offering, adding momentum to a return of high-profile listings.
* Rite Aid Corp. is preparing a Chapter 11 bankruptcy filing to restructure debts including opioid liabilities, according to people with knowledge of the matter.
* Marathon Petroleum Corp. is in the process of shutting the third largest oil refinery in the US after a blaze at a storage tank.
* Danaher Corp. has emerged as the leading bidder for biotechnology supplier Abcam Plc, according to people familiar with the matter.
* Affirm Holdings Inc. surged after reporting an increase in transactions on the buy now, pay later firm’s platforms as deals with new merchants helped offset challenges from rising interest rates.
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 0.8%
* The Dow Jones Industrial Average rose 0.7%
* The MSCI World index rose 0.1%
Currencies
* The Bloomberg Dollar Spot Index was little changed
* The euro was little changed at $1.0803
* The British pound was little changed at $1.2590
* The Japanese yen fell 0.4% to 146.38 per dollar
Cryptocurrencies
* Bitcoin fell 0.2% to $25,956.64
* Ether fell 0.2% to $1,645.68
Bonds
* The yield on 10-year Treasuries was little changed at 4.23%
* Germany’s 10-year yield advanced five basis points to 2.56%
* Britain’s 10-year yield advanced two basis points to 4.44%
Commodities
* West Texas Intermediate crude rose 1.2% to $80.03 a barrel
* Gold futures fell 0.3% to $1,942.10 an ounce
This story was produced with the assistance of Bloomberg Automation.
–With assistance from Richard Henderson, Namitha Jagadeesh, Sagarika Jaisinghani, Emily Graffeo and Isabelle Lee.
Have a wonderful weekend everyone.

Be magnificent!

As ever,

Carolann
Take care that no one hates you justly. –Publius Syrus, 85-45 BC.

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