Author: Carolann

Dear Friends,

Tangents:

May 22^nd,1992 – Johnny Carson hosted NBC’s “Tonight Show” for the last time after nearly 30 years in the job.
May 22^nd, 1867 – London England – Queen Victoria gives Royal Assent to the British North America Act; decrees that the Dominion of Canada should come into being on July 1.

We are shaped by our thoughts; we become what we think.  When the mind is pure, joy follows like a shadow that never leaves. –Buddha.

Photos of the day

Britain’s Queen Elizabeth makes a comment about a guide dog at the first garden party of the season at Buckingham Palace, London, May 21.Leon Neal/Reuters

A Domed Land Snail (Zospeum tholussum), is shown in this undated handout photo taken in the Lukina-Trojama cave system in Croatia provided by the International Institute of Species Exploration and the State University of New York (SUNY) College of Environmental Science and Forestry on May 21. The Domed Land Snail is among a list of top 10 new species discovered in 2013, scientists announced. The list, assembled annually since 2008, is intended to draw attention to the fact that researchers continue to discover new species. SUNY College of Environmental Science and Forestry/Reuters

Market Closes for May 22^nd, 2014

Market   Index	Close	Change
Dow   Jones	16543.08	+10.02    +0.06%
S&P 500	1892.49	+4.46    +0.24%
NASDAQ	4154.344	+22.806    +0.55%
TSX	14702.29	+52.43
		+0.36%

International Markets

Market   Index	Close	Change
NIKKEI	14337.79	+295.62
		+2.11%
HANG   SENG	22953.76	+117.24
		+0.51%
SENSEX	24374.40	+76.38
		+0.31%
FTSE 100	6820.56	-0.48
		-0.01%

Bonds

Bonds	% Yield	Previous % Yield
CND.   10 Year Bond	2.325	2.300
CND.   30 Year Bond	2.869	2.844
U.S.   10 Year Bond	2.5499	2.5338
U.S.   30 Year Bond	3.4244	3.4126

Currencies

BOC Close	Today	Previous
Canadian $	0.91801	0.91626
US   $	1.08931	1.09139
Euro Rate   1 Euro=		Inverse
Canadian   $	1.48760	0.67222
US   $	1.36562	0.73227

Commodities

Gold	Close	Previous
London Gold   Fix	1294.11	1291.45
Oil	Close	Previous
WTI Crude Future	104.12	104.52
BRENT	109.360	109.360

Market Commentary:

Canada
By Gerrit De Vynck

May 22 (Bloomberg) — Canadian stocks rose for a third day after the biggest banks reported better-than-estimated earnings.

Royal Bank of Canada jumped 1.6 percent and Toronto- Dominion Bank increased 2.6 percent as gains from consumer banking and wealth management boosted profit. Financial companies added 0.9 percent, the biggest increase among 10 industries in the S&P/TSX. Corvus Gold Inc. rose 9.7 percent after saying it had found more gold at its Yellowjacket deposit in Nevada.

The Standard & Poor’s/TSX Composite Index rose 52.43 points, or 0.4 percent, to 14,702.29 at 4 p.m. in Toronto. The gauge has risen for 10 months straight, its longest steak since 1983, and is 0.4 percent below an almost six-year high reached on May 2.

“The earnings did surprise and certainly the market seems to like them,” said John Kinsey, a fund manager at Caldwell Securities Ltd. in Toronto. His firm oversees about C$1 billion ($920 million).

Canadian retail sales decreased 0.1 percent in March, compared with a 0.3 percent increase predicted by economists surveyed by Bloomberg.

The government-owned Canada Mortgage and Housing Corp. said housing starts will slow this year to 181,100 new units. Last year, 187,923 units were built.

Canada’s banks, ranked as the world’s soundest by the World Economic Forum for six straight years, have continued to post profit growth despite a slowdown in domestic consumer lending.

Royal Bank climbed 1.6 percent to C$75.46 after reporting its second-quarter net income gained 15 percent to C$2.2 billion, or C$1.47 a share. Toronto-Dominion gained 2.6 percent to C$53.25. Its profit increased 16 percent to C$1.99 billion, or C$1.04 a share.

Corvus Gold gained 9.7 percent to C$1.25. The Vancouver- based miner said it had extended high grade gold veins at the North Bullfrog Project in Nevada.

Bombardier Inc. lost 1.3 percent to C$3.83, extending a drop of 1.3 percent yesterday after a key customer for its new CSeries jets said it was considering whether to take the planes after a change in airline strategy.

ATS Automation Tooling Systems Inc. advanced 1.4 percent to C$14.82 after reporting fourth-quarter revenue that surpassed analyst estimates.

Sears Canada Inc. slid 4.5 percent to C$14.40 as parent company Sears Holdings Corp., the retailer controlled by billionaire hedge-fund manager Edward Lampert, posted a wider first-quarter loss amid a sales decline that’s stretched into its seventh year.

US
By Callie Bost

May 22 (Bloomberg) — U.S. stocks rose, sending the Standard & Poor’s 500 Index to near a record, and small-cap shares rebounded as data showing strength in manufacturing boosted confidence in the global economy.

Best Buy Co. and Williams-Sonoma Inc. added at least 3.4 percent to pace gains among retailers. An index of homebuilders rallied as sales of previously owned U.S. homes rose in April. Hewlett-Packard Co. dropped 2.3 percent as it reported second- quarter sales that fell short of estimates and announced it is cutting more jobs.

The S&P 500 rose 0.2 percent to 1,892.49 at 4 p.m. in New York. The benchmark index came within two points of its all-time high of 1,897.45 reached last week. The Dow Jones Industrial Average climbed 10.02 points, or 0.1 percent, to 16,543.08. The Russell 2000 Index of smaller companies rallied 0.9 percent. About 5.3 billion shares changed hands on U.S. exchanges, 19 percent below the three-month average.

“It’s a grindingly slow, gradualistic uptrend of the U.S. economy,” David Young, founder chief executive officer of Newport Beach, California-based Anfield Capital Management LLC, which manages $100 million, said by phone. “We absolutely, positively must factor in the vast amount of liquidity looking for an interesting home. As a result, ‘sell in May and go away’ has been proven wrong, because where else are you going to go?”

The U.S. stock market is trading in the tightest range in eight years, according to data from Bespoke Investment Group LLC. In the last three months, the difference between the S&P 500’s intraday high and low has been less than 5 percent, the Harrison, New York-based research group said in a report today.

The Markit Economics preliminary index of U.S. manufacturing increased to 56.2 in May from 55.4 a month earlier as output accelerated, the London-based group said today. Readings above 50 for the purchasing managers’ measure indicate expansion and the May figure was the highest in three months. A preliminary purchasing managers’ index in China increased to a five-month high.

Other data showed sales of previously owned U.S. homes rose in April for the first time in four months as the weather warmed, price increases slowed and more properties were put on the market. More Americans than projected filed applications for unemployment benefits last week, showing uneven progress in the labor market.

The S&P 500 climbed 0.8 percent yesterday, erasing the previous day’s declines, as Federal Reserve policy makers said continued stimulus doesn’t risk fueling a jump in the inflation rate. Central bank policy makers said last month the economy is showing signs of picking up and the job market is improving.

The central bank pared its monthly asset buying to $45 billion in April, its fourth straight $10 billion cut, and said further reductions in measured steps are likely.

Three rounds of bond purchases by the Fed have helped send the S&P 500 up as much as 180 percent from a 12-year low in 2009.

The Chicago Board Options Exchange Volatility Index, a gauge for U.S. stock volatility known as the VIX, rose 1 percent to 12.03 today. The gauge closed yesterday at the lowest level since August.

Eight out of 10 S&P 500 industry groups rose today, with health-care and utility companies gaining at least 0.5 percent for the biggest advances. Retailers rose 0.5 percent as a group.

Best Buy rallied 3.4 percent to $26.22. The world’s largest consumer-electronics retailer posted first-quarter profit that topped analysts’ estimates as Chief Executive Officer Hubert Joly continued to trim costs.

Williams-Sonoma climbed 8.2 percent to a record $68.93. The seller of cookware and home furnishings raised its full-year earnings forecast to as much as $3.17 a share, after earlier predicting no more than $3.15. The San Francisco-based company also reported first-quarter profit of 48 cents a share, exceeding the 44-cent analyst projection.

Dollar Tree Inc. jumped 6.6 percent to $53.31 for the biggest gain in the S&P 500. The discount retailer reported first-quarter earnings that beat analysts’ estimates. The company said it expects as much as $2.02 billion in second- quarter revenue, exceeding analysts’ estimates of $2.01 billion for the period.

Consumer stocks are the worst-performing among 10 industries this year, down 3.6 percent as a group, after leading the S&P 500’s gain last year with a 41 percent rally.

Investors have withdrawn $3.9 billion from U.S. exchange- traded funds tracking consumer-discretionary stocks this year, more than any other industry, data compiled by Bloomberg show. The group has slumped 3.6 percent this year, the only one of the 10 main S&P 500 industries that has not advanced.

Hewlett-Packard dropped 2.3 percent to $31.78. The world’s second-biggest personal-computer maker said sales in the second quarter fell 1 percent to $27.3 billion from a year earlier, lower than the $27.4 billion analysts projected for the period. The company said it will eliminate 11,000 to 16,000 positions, on top of 34,000 already announced. Hewlett-Packard had 317,500 employees at the end of October.

Hess Corp. jumped 1.1 percent to $90.29. Marathon Petroleum Corp. agreed to acquire the company’s gasoline stations and retail business for a total of $2.87 billion, expanding its footprint to 23 states from nine.

An S&P index of homebuilders rallied 2.1 percent after the report on existing-home sales. PulteGroup Inc. soared 2.2 percent to $19.22 and D.R. Horton Inc. climbed 2.4 percent to $22.65.

Activision Blizzard Inc. dropped 1.6 percent to $20.53 after saying that Vivendi SA is selling half of its remaining stake in the video-gamer maker in an offering valued at more than $850 million.

JD.com Inc., the Chinese online retailer that handled more than $20 billion of purchases on its website last year, rose in its trading debut. The company gained 10 percent to $20.90 after raising $1.78 billion by selling the shares for $19.

The Russell 2000 has rallied 1.5 percent over two days. The index tumbled as much as 9.3 percent from a record on March 4 amid concern that prices have outrun earnings. Small-caps and Internet shares were among the biggest victims of the market retreat as investors fled last year’s best-performing equities.

The Dow Jones Internet Composite Index increased 0.8 percent today. The gauge is still down 15 percent from a 13-year high reached in March.
Have a wonderful evening everyone.

 

Be magnificent!

Variety is the first principle of life.

What makes us formed beings?

Differentiation.

Perfect balance will be destruction.

Swami Vivekananda, 1863-1902

As ever,

 

Carolann

 

When you feel in your gut what you are and then

dynamically pursue it – don’t back down and don’t

give up – then you’re going to mystify

a lot of folks.

-Bob Dylan, 1941-

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

 

Dear Friends,

Tangents:

Want to be happier?  Go to the trees.  New research ties proximity to parks and other green spaces to better mental health, writes Ben Schiller at Fast Company.  People living in places with more trees are likely to be happier, with the association between the two “significant and sizable,”  according to one recent study.  The findings could be used to argue for more investment in green spaces.  “ ‘Our work indicated that “greening” could be considered a potentially low-cost, high-return investment among urban and regional planners to positively influence population mental health,’ “ Mr. Schiller quotes the study’s authors as saying.

I read with dismay last week that so many beautiful old trees in Vancouver have already disappeared and continue to be destroyed as neighborhoods are transformed by developers.  It should be outlawed in my opinion.  The trees should be saved and it should be mandated that when new owners buy a property to tear down and rebuild, the trees on the property are given priority.

Photos of the day

A crow carries twigs in its beaks at a park in Tokyo. Shizuo Kambayashi/AP

A light show featuring a ballet dancer and swans from Swan Lake is projected onto spraying water by the Vivid Aquatique Water Theatre during a preview of the Vivid Sydney light and music festival. For 18 days beginning on May 23 the Vivid Sydney festival, one of the world’s largest creative industry forums, will combine outdoor lighting sculptures and installations. Jason Reed/Reuters

Market Closes for May 21^st, 2014

Market   Index	Close	Change
Dow   Jones	16532.74	+158.43    +0.97%
S&P 500	1887.19	+14.36     +0.77%
NASDAQ	4131.539	+34.648    +0.85%
TSX	14644.12	+118.93
		+0.82%

International Markets

Market   Index	Close	Change
NIKKEI	14042.17	-33.08
		-0.24%
HANG   SENG	22836.52	+1.84
		+0.01%
SENSEX	24298.02	-78.86
		-0.32%
FTSE 100	6821.04	+19.04
		+0.28%

Bonds

Bonds	% Yield	Previous % Yield
CND.   10 Year Bond	2.300	2.280
CND.   30 Year Bond	2.844	2.822
U.S.   10 Year Bond	2.5338	2.5106
U.S.   30 Year Bond	3.4126	3.3850

Currencies

BOC Close	Today	Previous
Canadian $	0.91626	0.91683
US   $	1.09139	1.09071
Euro Rate   1 Euro=		Inverse
Canadian   $	1.49372	0.66947
US   $	1.36864	0.73065

Commodities

Gold	Close	Previous
London Gold   Fix	1291.45	1294.26
Oil	Close	Previous
WTI Crude Future	104.52	102.44
BRENT	109.360	109.360

Market Commentary:

Canada
By Eric Lam

May 21 (Bloomberg) — Canadian stocks rose a second day as energy producers rallied with oil following an industry report showing a drop in U.S. inventories.

Lightstream Resources Ltd. and Pacific Rubiales Energy Corp. added at least 3.9 percent as crude in New York climbed to a one-month high. Royal Bank of Canada increased 1 percent to pace gains among bank stocks. Rio Alto Mining Ltd. sank 7.5 percent after agreeing to buy Sulliden Gold Corp. in an all- stock deal worth about C$300 million ($274.32 million). Sulliden soared 33 percent.

The Standard & Poor’s/TSX Composite Index rose 96.43 points, or 0.7 percent, to 14,621.62 at 2:08 p.m. in Toronto.  The S&P/TSX is little changed in May. The gauge has rallied for 10 months, the longest winning streak in three decades.

“Crude is really helping the market,” said Stephen Gauthier, chief investment officer at Fin-XO Securities Inc. in Montreal. His firm manages about C$650 million. “Oil stocks have done very well since the beginning of the year so that certainly helps.”

The Canadian equity benchmark trade at a price-earnings ratio of 19.6, near the highest level since 2011, data compiled by Bloomberg show.

Crude advanced 1.7 percent to $104.11 a barrel. U.S. crude stockpiles decreased 7.23 million barrels to 391.3 million in the seven days ended May 16, according to the Energy Information Administration. Analysts surveyed by Bloomberg projected no change in inventories. Crude imports fell to the lowest level since 1997 while U.S. output climbed to a 28-year high.

Pacific Rubiales gained 6.1 percent to C$19.51 and Lightstream Resources added 3.9 percent to C$7.41 as energy companies rallied 1 percent as a group. Nine of 10 industries in the S&P/TSX advanced on trading volume 16 percent lower than the 30-day average at this time of the day.

Royal Bank of Canada increased 1 percent to C$74.15 and Toronto-Dominion Bank added 0.5 percent to C$51.79. The two lenders, the largest in the nation, are scheduled to report second-quarter earnings tomorrow.

CI Financial Corp. rose 2.4 percent to C$33.87 after Geoffrey Kwan, analyst at RBC Capital, raised his rating for the stock to outperform, the equivalent of a buy. Onex Corp. rallied 1.9 percent to C$62.93 as the S&P/TSX Financials Index advanced 0.7 percent, the most in three weeks.

Encana Corp. added 1.7 percent to C$25.25 for a second day of gains after increasing the size of its initial public offering for PrairieSky Royalty Ltd. to as much as C$1.46 billion, in what would be Canada’s largest initial sale in 14 years.

Rio Alto Mining slumped 7.5 percent to C$1.97, the lowest since January, after agreeing to buy Sulliden Gold to expand its production of the precious metal. Rio Alto will pay 0.525 of its shares for each Sulliden share, along with 0.1 share of a newly incorporated company that will hold Sulliden’s stake in the East Sullivan property in Quebec.

Sulliden soared 33 perent to C$1.04, the biggest increase since January 2009.

Bombardier Inc. dropped 2.9 percent to C$3.82. Republic Airways Holdings Inc., Bombardier’s biggest customer for the CSeries jet, said its order for 40 of the aircraft is no longer a priority. Chief Executive Officer Bryan Bedford said the Indianapolis-based company hasn’t made any decisions about the order.

US
By Callie Bost

May 21 (Bloomberg) — The Standard & Poor’s 500 Index advanced, erasing yesterday’s declines, as Tiffany & Co. rallied and Federal Reserve policy makers said continued stimulus doesn’t risk sparking a jump in the inflation rate.

Tiffany gained 9.2 percent to lead an advance among retailers as quarterly profit beat estimates. Netflix Inc. rose 5.1 percent after saying it will expand its online-video service in Europe. Exxon Mobil Corp. and Chevron Corp. climbed more than 1.4 percent as the price of oil surged.

The S&P 500 added 0.8 percent to 1,888.03 at 4 p.m. in New York. The equity benchmark is 0.5 percent away from a record reached on May 13. The Dow Jones Industrial Average climbed 158.75 points, or 1 percent, to 16,533.06. The Russell 2000 Index of smaller companies was up 0.5 percent, while the Nasdaq 100 Index rose to the highest level since April 3. About 5.3 billion shares changed hands on U.S. exchanges, 20 percent below the three-month average.

“There were no big surprises in the Fed minutes,” Darrell Cronk, deputy chief investment officer at Wells Fargo Private Bank, which manages $170 billion, said by phone. “There was more of the same and that means more dovish statements. We continue to think the domestic equity markets will climb higher.  The fundamentals are good.”

Minutes of the central bank’s April 29-30 meeting released today in Washington showed Fed officials also discussed the need to improve their guidance on the likely path of interest rates. Participants agreed that “early communication” of their exit strategy “would enhance the clarity and credibility of monetary policy.”

Policy makers said last month the economy is showing signs of picking up and the job market is improving. The central bank pared its monthly asset buying to $45 billion in April, its fourth straight $10 billion cut, and said further reductions in measured steps are likely.

The Fed reiterated at the time that it will keep the key rate target near zero for a “considerable time” once it concludes the bond-purchase program.

Fed Chair Janet Yellen testified to lawmakers May 7 that the Fed will probably end bond buying in the fall if the labor market continues to improve. Still, she said “a high degree of monetary accommodation remains warranted” with inflation and employment far from the central bank’s goals.

Three rounds of bond purchases by the Fed have helped send the S&P 500 up as much as 180 percent from a 12-year low in 2009. It is trading at 16 times the projected earnings of its members, greater than a five-year average of 14.3 times, according to data compiled by Bloomberg.

About 75 percent of S&P 500 companies that have posted results this season have beaten analysts’ estimates for profit, while 53 percent have exceeded sales projections, data compiled by Bloomberg show.

The S&P 500 fell 0.7 percent yesterday after retailers reported lower-than-estimated earnings and small-cap shares slumped. The benchmark index closed at an all-time high of 1,897.45 on May 13 before a selloff in small-cap stocks spread to the broader market. The Russell 2000 tumbled 1.5 percent yesterday, and is down 8.7 percent from a record set in March.

The Chicago Board Options Exchange Volatility Index, a gauge for U.S. stock volatility known as the VIX, fell 8.1 percent to 11.91 today, the lowest level since August. The measure has lost 13 percent this year.

All 10 main industries in the S&P 500 rose today, with consumer-discretionary and energy companies gaining at least 1 percent for the biggest advances.

Retailers rose 1.2 percent as a group in the S&P 500, after slumping 1 percent yesterday amid worse-than-estimated results from companies from Staples Inc. to Urban Outfitters Inc.

Tiffany increased 9.2 percent to a record $96.30 today. The world’s second-largest jewelry retailer reported first-quarter profit that exceeded analysts’ estimates and raised its forecast for the year as price increases helped boost sales.

Netflix jumped 5.1 percent to $390.60, the highest level in two months. The shares have rebounded 24 percent from a six- month low on April 28. The world’s largest Internet subscription service will enter Germany, France, Austria, Belgium, Luxembourg and Switzerland, according to a statement. The company already operates in the U.K., Ireland, the Netherlands, Denmark, Norway, Sweden and Finland.

TJX Cos. rallied 4.9 percent to $56.60. The owner of the T.J. Maxx discount chain tumbled 7.6 percent yesterday, the most in more than five years, after posting first-quarter profit and sales that trailed analysts’ estimates.

The Dow Jones Internet Composite Index increased 1.2 percent, as Facebook Inc. added 3.3 percent. TripAdvisor Inc. and LinkedIn Corp. rose more than 1.9 percent.

Exxon Mobil advanced 1.4 percent to $102.03 and Chevron increased 1.4 percent to $124.16 to pace gains among energy companies. Occidental Petroleum Corp. surged 2.2 percent to $97.59. West Texas Intermediate crude rose to a one-month high after a government report showed U.S. supplies tumbled last week as imports dropped to a 17-year low.

PetSmart Inc. tumbled 8.3 percent to $57.02. The pet services retailer cut its profit forecast this year to below analysts’ forecasts as first-quarter revenue missed estimates.

 

Have a wonderful evening everyone.

 

Be magnificent!

When the poor come to you in great need, begging for food,

do not harden your hearts against them.

Remember that the poor may once have been rich,

and you may one day be poor.

When you see people who are think for lack of food,

beg them to accept your help;

remember that you may need their friendship in times to come.

Rig Veda

As ever,

 

Carolann

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

 

Dear Friends,

Tangents:

This is interesting, fascinating how far we’ve come considering that it was on this day in 1932 that Amelia Earhart took off from Newfoundland; she landed in Ireland nearly 15 hours later, becoming the first woman to fly solo across the Atlantic Ocean.

New cameras to probe planets based in chile, new cameras will search outside solar system.

A new phase in the study of planets beyond the solar system is about to begin.  Two new cameras designed to directly image Jupiter-class planets orbiting other stars and gather data on extrasolar-planet atmospheres have been brought on line at two of the world’s major observatories located on arid mountaintops in Chile’s Atacama Desert.

On May 4, the European Southern Observatory lifted the figurative lens cap off of its camera, Sphere, for the first time at its Very Large Telescope array near Paranal, Chile.  Meanwhile, astronomers associated with the Gemini Planet Imager at the Gemini South Observatory have reported the first science results from their camera, which captured its first light last November. The studies were conducted during GPI’s commissioning phase, which is still underway.

Both cameras are slated to undertake the most ambitious direct-imaging campaigns astronomers have yet conducted, surveying up to 600 stars for signs of large, hot, young plants in wide orbits around their host stars.  Sphere’s search aims to span distances ranging from five to 10 astronomical units from their host stars – comparable to the distances between Jupiter and Saturn. GPI is designed to cast a wider net, ranging from five to 30 AU, the distance from Jupiter to Neptune.

At these orbital distances, planets spend a decade or more completing one orbit. The evidence for their presence is so faint that most common planet-hunting techniques couldn’t detect them. Even if they could, astronomers generally want to log multiple detections in order to confidently claim a discovery. Several decades is a long time to wait before shouting “Eureka!” – By PETE SPOTTS.

To conquer oneself is a greater task than conquering others. –Buddha.

Photos of the day

Britain’s Prince Charles watches traditional dancers in Halifax, Nova Scotia, May 19. Prince Charles and his wife Camilla, Duchess of Cornwall, are on a four-day visit to Canada that begins in Halifax and includes stops in Pictou, Nova Scotia; the Prince Edward Island towns of Charlottetown, Bonshaw, and Cornwall; and concludes in Winnipeg. Mark Blinch/Reuters

The pack pedals during the 10th stage of the Giro d’Italia, Tour of Italy cycling race, from Modena to Salso Maggiore, Italy. Fabio Ferrari/AP

Participants in the Sydney Harbour Bridge Climb wear lighted vests as they climb the bridge high above the city traffic (r.) at night, during a preview of the Vivid Sydney light and music festival. For 18 days beginning on May 23, Sydney will light up at night as part of the Vivid Sydney festival, combining outdoor lighting sculptures and installations at one of the world’s largest creative industry forums, according to the organizers. Jason Reed/Reuters

Market Closes for May 20^th, 2014

Market   Index	Close	Change
Dow   Jones	16374.31	-137.55    -0.83%
S&P 500	1872.83	-12.25    -0.65%
NASDAQ	4096.891	-28.924    -0.70%
TSX	14525.19	+10.45
		+0.07%

International Markets

Market   Index	Close	Change
NIKKEI	14075.25	+68.81
		+0.49%
HANG   SENG	22834.68	+130.18
		+0.57%
SENSEX	24376.88	+13.83
		+0.06%
FTSE 100	6802.00	-42.55
		-0.62%

Bonds

Bonds	% Yield	Previous % Yield
CND.   10 Year Bond	2.280	2.264
CND.   30 Year Bond	2.822	2.799
U.S.   10 Year Bond	2.5106	2.5213
U.S.   30 Year Bond	3.3850	3.3443

Currencies

BOC Close	Today	Previous
Canadian $	0.91683	0.92056
US   $	1.09071	1.08630
Euro Rate   1 Euro=		Inverse
Canadian   $	1.49410	0.66930
US   $	1.36993	0.72996

Commodities

Gold	Close	Previous
London Gold   Fix	1294.26	1292.94
Oil	Close	Previous
WTI Crude Future	102.44	102.02
BRENT	109.360	109.360

Market Commentary:

Canada
By Eric Lam

May 20 (Bloomberg) — Canadian stocks snapped three days of losses as Valeant Pharmaceuticals International Inc. gained before a meeting with Allergan Inc. investors, offsetting losses among the banks ahead of earnings.

Valeant rose 3.7 percent after saying it will discuss an improved offer for the company at meeting in New York next week. CAE Inc., the flight simulator maker, gained 0.9 percent after analysts at Desjardins Securities raised their rating for the shares citing stronger earnings. Element Financial Corp. and Canadian Western Bank slid more than 1.2 percent to lead losses among finance stocks.

The Standard & Poor’s/TSX Composite Index rose 10.45 points, or 0.1 percent, to 14,525.19 at 4 p.m. in Toronto. The equity gauge swung between losses of as much as 0.2 percent and gains of 0.4 percent. It’s up 6.6 percent this year. Trading volume was about 4.1 percent higher than the 30-day average.

“It’s a wait-and-see attitude for the Canadian banks, and also for economic statistics before people get back on the bandwagon,” said Ian Nakamoto, director of research at MacDougall MacDougall & MacTier Inc. in Toronto. His firm manages about C$4.7 billion ($4.31 billion). “People are saying the sluggishness of the first quarter was due to weather, so they’re waiting to see evidence the second or third quarter will pick up.”

Valeant increased 3.7 percent to C$142.76, the most in a month, as health-care stocks paced gains in the S&P/TSX. The company said it will present an improved bid for Allergan shareholders at the May 28 meeting, which will not be an all- cash deal.

Aaron Gal, an analyst at Sanford Bernstein & Co., said in a report that Valeant’s offer should be in the $190 a share range.

Element Financial lost 2.9 percent to C$13.21 and Canadian Western Bank retreated 1.2 percent to C$36.42 to pace declines as 34 of 46 members of the S&P/TSX Financials Index fell.

Toronto-Dominion Bank slipped 0.1 percent to C$51.56 and Royal Bank of Canada added 0.8 percent to C$73.40. The two lenders, the largest in Canada by market value, are scheduled to report second-quarter earnings on May 22.

CAE added 0.9 percent to C$14.68 after Benoit Poirier at Desjardins raised his rating for the stock to buy from hold and increased his price target to C$17 from C$16.

“There is more upside ahead,” Poirier said in the report to clients, with the company benefiting from a solid backlog and improved margins.

HudBay Minerals Inc. rose 0.5 percent to C$10.05 after the metals mining company extended its offer to buy Augusta Resource Corp. to May 27. The all-stock offer values Augusta at about C$453.8 million.

Balmoral Resources Ltd. jumped 20 percent to C$1.30, the highest level since August 2011, after the Vancouver-based exploration company said it confirmed the discovery of a high- grade nickel and copper deposit.

US
By Callie Bost

May 20 (Bloomberg) — U.S. stocks fell, halting a two-day gain, as retailers from Staples Inc. to Urban Outfitters Inc. posted worse-than-estimated results and smaller companies slid.

Staples tumbled 13 percent after forecasting second-quarter profit that was less than analysts estimated. Urban Outfitters sank 8.8 percent as earnings missed forecasts. Caterpillar Inc. led industrial shares lower after reporting a steepening decline in retail machine sales.

The Standard & Poor’s 500 Index slipped 0.7 percent to 1,872.83 at 4 p.m. in New York. The Dow Jones Industrial Average fell 137.55 points, or 0.8 percent, to 16,374.31. The Russell 2000 Index of small-cap stocks slid 1.5 percent. About 5.7 billion shares changed hands on U.S. exchanges, 13 percent below the three-month average.

“What we’re seeing is a re-assessment of the growth prospects of earnings,” Brad McMillan, the chief investment officer for Commonwealth Financial Network, said by phone. His firm oversees $83 billion. “It’s not a question of ‘are we going to grow?’ Because we are. It’s ‘are we going to grow as fast as we thought we would?’”

Investors are favoring fixed income over equities as concern over valuations roiled stocks from small-cap companies to Internet shares. Exchange-traded funds that buy American bonds attracted $138.8 million yesterday while $2 billion was taken out of equity ETFs, data compiled by Bloomberg show. That reversed year-to-date equity ETF flows and drove withdrawals for the quarter to $711 million. Should the trend continue through June, that would be the first quarterly deficit since the three months ended March 2010, the data show.

The S&P 500 climbed 0.4 percent yesterday in one of the slowest trading days of the year as Internet and smaller companies extended a rebound from last week’s losses. The benchmark index closed at an all-time high of 1,897.45 on May 13 before a selloff in small-cap stocks spread to the broader market.

The Russell 2000 Index fell 3.3 percent over three days last week before rebounding 0.6 percent on May 16 and a further 1 percent yesterday. The gauge is 9.2 percent below its record set in March.

“Between now and June, waning earnings data and no significant U.S. economic data suggest equities have no appreciable catalyst for why they should march significantly higher,” Mark Luschini, chief investment strategist at Philadelphia-based Janney Montgomery Scott LLC, which oversees  $65 billion in assets, said in a phone interview. “We’re going to be in this trading range for several months.”

Salesforce.com Inc. and Intuit Inc. are among S&P 500 companies reporting results today. About 75 percent of those that have posted results this season have beaten analysts’ estimates for profit, while 53 percent have exceeded sales projections, data compiled by Bloomberg show.

Federal Reserve Chair Janet Yellen said last week the U.S. economy has further to go to achieve full health and predicted small businesses will play a vital role in the recovery.

The Fed will release minutes from its latest meeting tomorrow. Policy makers said last month the economy is showing signs of picking up and the job market is improving. The central bank pared its monthly asset buying and said further reductions in “measured steps” are likely.

Fed Bank of New York President William Dudley said the pace of eventual rate increases “will probably be relatively slow,” depending on the economy’s progress and how financial markets react. A “mild” response “might encourage a somewhat faster pace,” Dudley said today to the New York Association for Business Economics. “If bond yields were to move sharply higher,” on the other hand, “a more cautious approach might be warranted.”

“Investors seem to be nervous and the market seems very reactionary right now,” Walter Todd, who oversees about $980 million as chief investment officer at Greenwood Capital Associates LLC, said by phone. “People are trying to get a handle on what exactly the Fed’s reaction function is on when they are raising rates. The problem for them there is I don’t know if they even know themselves.”

Three rounds of bond purchases by the Fed have helped send the S&P 500 up as much as 180 percent from a 12-year low in 2009. The gauge trades at 15.9 times estimated earnings, compared with a five-year average of 14.3 times, according to data compiled by Bloomberg.

The Chicago Board Options Exchange Volatility Index, a gauge for U.S. stock volatility known as the VIX, rose 4.4 percent to 12.96. The measure has lost 5.5 percent this year.

Nine out of 10 S&P 500 groups fell today, with phone and industrial shares tumbling at least 1.3 percent for the biggest declines. Retailers lost 1 percent as a group.

Staples slid 13 percent to $11.71 after posting first- quarter adjusted earnings of 18 cents a share. Analysts on average had projected 21 cents. The biggest U.S. office-supply chain also said sales will decline in the second quarter from a year earlier.

Urban Outfitters declined 8.8 percent to $32.98 after reporting first-quarter earnings of 26 cents a share, missing the 27-cent average projection of analysts in a Bloomberg survey. The teen-clothing retailer also said comparable sales were little changed for the quarter, versus a 0.3 percent gain that analysts predicted.

Dick’s Sporting Goods Inc. tumbled 18 percent, the most ever, to $43.60 after weak sales of golfing and hunting gear crimped its profit forecast. TJX Cos. fell 7.6 percent to $53.95 after cutting the top end of its full-year projection.

Home Depot Inc. rose 1.9 percent to $77.96 for the biggest gain in the Dow. While the company posted first-quarter profit that trailed some analysts’ estimates, Chief Financial Officer Carol Tome said it expects revenue lost due to the grim winter will be recouped this quarter.

Caterpillar lost 3.6 percent to $101.56. Global sales fell 13 percent in the three months through April compared with the same period a year earlier, Caterpillar said today in a filing. In the resource industries segment, sales fell 70 percent in the Asia-Pacific region and 68 percent in Latin America in the most recent period. Sales were also down 3 percent in North America and 45 percent lower in Europe, Africa and the Middle East.

The Dow Jones Internet Composite Index slipped 0.7 percent. The gauge rallied 2 percent over the previous two days, and is down 8.8 percent this year.

Amazon.com Inc. increased 1.5 percent to $301.19. Netflix Inc. advanced 2 percent to $371.67 for the largest gain in the S&P 500.

Carnival Corp. climbed 0.9 percent to $39.18 after saying P&O Cruises Australia, one of its 10 brands, will add two ships to its fleet next year. That will bring the total to five, making it Australia’s biggest year-round fleet, the world’s largest cruise-line operator said in a statement. Morgan Stanley raised its stock rating.

Ophthotech Corp. jumped 24 percent to $39.16. The drug developer granted Novartis AG the exclusive rights to commercialize its Fovista treatment in markets outside the U.S. Ophthotech said it may get more than $1 billion from the deal, including $200 million upfront and further payments if it reaches some targets.

 

Have a wonderful evening everyone.

 

Be magnificent!

We must learn to love those who think exactly opposite to us.

We have humanity for the background, but each must have his own individuality and his own thought.

Push the sects forward and forward till each man and woman are sects unto themselves.

We must learn that differentiation is the life of thought.

We have one common goal,

and that is the perfection of the human soul, the god within us.

Swami Vivekananda, 1863-1902

As ever,

 

Carolann

 

Character building begins in our infancy

and continues until death.

-Eleanor Roosevelt, 1884-1962

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

 

Dear Friends,

Tangents:

Lord Byron to John Murray, May 18, 1819.

I write to you in haste and at past two in the morning – having besides had an accident.  In going, about an hour and a half ago, to a rendezvous with a Venetian girl (unmarried and the daughter of one of their nobles), I tumbled into the Grand Canal, and not choosing to miss my appointment by the delays of changing, I have been perched in a balcony with my wet clothes on ever since – till this minute that on my return I have slipped into my dressing-gown.  My foot slipped in getting into my gondola to set out (owing to the cursed slippery steps of their palaces) and in I flounced like a carp – and went dripping like a triton to my sea-nymph – and had to scramble up to a grated window…

Dorothy Wordsworth, Journal, May 19, 1800.

Sauntered a good deal in the garden, bound carpets, mended old clothes.  Read Timon of Athens.  Dried linen.  Molly weeded the turnips, John stuck the peas.  We had not much sunshine or wind, but no rain till about seven o’clock, when we had a slight shower just after I had set out upon my walk.  I did not return but walked up into the Black Quarter [Easedale].  I sauntered a long time among the rocks above the church…I strolled on, gathered mosses etc.  The quietness and still seclusion of the valley affected me even to producing the deepest melancholy.  I forced myself from it. –from The Book of Days.

Photos of the day

90-year-old Hiraben blesses her son and India’s next prime minister Narendra Modi at her home in Gandhinagar, in the western Indian state of Gujarat. Saurabh Das/AP

Geisha girls parade down the streets toward Asakusa Shrine in the compound of Sensoji Temple in Tokyo prior to the annual Sanja Festival, one of the three major festivals in Tokyo, scheduled on May 16-18. Eugene Hoshiko/AP

Market Closes for May 16^th, 2014

Market   Index	Close	Change
Dow   Jones	16491.31	+44.50    +0.27%
S&P 500	1877.35	+6.50    +0.35%
NASDAQ	4090.588	+21.296    +0.52%
TSX	14509.22	-79.67
		-0.55%

International Markets

Market   Index	Close	Change
NIKKEI	14096.59	-201.62
		-1.41%
HANG   SENG	22712.91	-17.95
		-0.08%
SENSEX	24121.74	+216.14
		+0.90%
FTSE 100	6855.81	+14.92
		+0.22%

Bonds

Bonds	% Yield	Previous % Yield
CND.   10 Year Bond	2.264	2.259
CND.   30 Year Bond	2.799	2.797
U.S.   10 Year Bond	2.5213	2.4964
U.S.   30 Year Bond	3.3443	3.3319

Currencies

BOC Close	Today	Previous
Canadian $	0.92056	0.91939
US   $	1.08630	1.08768
Euro Rate   1 Euro=		Inverse
Canadian   $	1.48747	0.67228
US   $	1.36930	0.73030

Commodities

Gold	Close	Previous
London Gold   Fix	1292.94	1296.63
Oil	Close	Previous
WTI Crude Future	102.02	101.50
BRENT	109.360	109.360

Market Commentary:

Canada
By Gerrit De Vynck

May 16 (Bloomberg) — Canadian stocks fell, capping the biggest three-day retreat in over a month, as shares of Smart Technologies Inc. and BlackBerry Ltd. dropped and data showed an unexpected decline in U.S. consumer confidence.

BlackBerry fell 1.9 percent after the smartphone maker said yesterday Bert Nordberg, a former chief executive officer of Sony Ericsson Mobile Communications, was leaving the board. Air Canada rose 2 percent after TD Securities Inc. recommended buying the shares. Smart Technologies lost 37 percent after reporting a fourth-quarter loss.

The Standard & Poor’s/TSX Composite Index fell 74.15 points, or 0.5 percent, to 14,514.74 at 4 p.m. in Toronto. Eight out of 10 industries in the index fell. The gauge fell 0.1 percent this week.

“What people are doing is de-risking ahead of some uncertainty on U.S. economic growth and the state of the consumer,” said Brian Huen managing partner at Red Sky Capital Management Ltd in Toronto. He helps manage about C$350 million.

Consumer confidence fell in May from a nine-month high, showing Americans are being shaken by rising grocery bills and elevated fuel costs. The Thomson Reuters/University of Michigan preliminary sentiment index decreased to 81.8 from 84.1 in April. The median projection in a Bloomberg survey of economists called for a gain to 84.5.

BlackBerry fell 1.9 percent to C$7.88. The rest of the current directors, including chairman Prem Watsa, are standing for re-election, the company said.

Air Canada gained 2 percent to C$8.07 as TD Securities raised its rating on the stock. The company reported a narrower first-quarter loss yesterday than analysts projected with the help of a cost-savings plan and as revenue climbed faster than estimated.

Smart Technologies lost 37 percent to C$2.90, the most ever. The interactive whiteboard maker reported a fourth-quarter loss of 5 cents a share yesterday and said the company has significant work left in its turnaround plan.

Just Energy Group Inc. decreased 17 percent to C$6.54. National Bank Financial and TD Securities lowered their ratings on the stock and RBC Capital Markets said the utility company may cut its dividend.

Canadian Imperial Bank of Commerce dropped 1.6 percent to C$96.49 after posting a C$420 million impairment charge on its Caribbean banking business. The bank, Canada’s fifth-largest, will report second-quarter earnings on May 29.

Bellatrix Exploration Ltd. fell 1.9 percent to C$9.96 after cutting its forecast for second-quarter production.

HudBay Minerals Inc. rose 1.6 percent to C$10 after Dundee Securities Inc. said the mining company probably won’t increase its offer for Augusta Resources Corp. Augusta lost 6.2 percent to C$3.01.

US
By Sofia Horta e Costa and Joseph Ciolli

May 16 (Bloomberg) — U.S. stocks rose, after the Standard & Poor’s 500 Index had its worst day in a month yesterday, as small-cap shares reversed declines amid a faster-than-forecast gain in the pace of home construction.

The Dow Jones Internet Composite Index jumped 0.5 percent after earlier falling 0.7 percent. Nordstrom Inc. jumped 15 percent as the luxury department-store chain reported quarterly results that exceeded estimates. Verizon Communications Inc. added 2.3 percent as Warren Buffett’s Berkshire Hathaway Inc.disclosed a stake. Chesapeake Energy Corp. sank the most in the S&P 500 after saying it will cut half its workforce.

The S&P 500 climbed 0.4 percent to 1,877.86 at 4 p.m. in New York, erasing its loss for the week. The gauge extended gains today after falling to its average price over the past 50 days, a level technical analysts consider significant. The Dow Jones Industrial Average added 44.50 points, or 0.3 percent, to 16,491.31. The Russell 2000 Index of small stocks jumped 0.6 percent, after earlier falling 0.7 percent. About 5.8 billion shares changed hands on U.S. exchanges, 13 percent below the three-month average.

“When you have sharp sell-offs, you have a lot of buyers on the sidelines waiting for that weakness,” James Paulsen, the Minneapolis-based chief investment strategist at Wells Capital Management, which oversees about $357 billion in assets, said by phone. “Certainly the housing numbers calmed a fair number of fears. People feel secure after a 1 percent sell-off and want to go long into the weekend.”

A report today indicated the pace of U.S. home construction jumped in April to its highest level since November, exceeding all analysts’ forecasts and showing builders returned to sites after freezing temperatures restrained work earlier this year. A surge in construction of multifamily dwellings helped overcome slack demand for single- family homes.

Separate data showed consumer confidence fell this month after reaching a nine-month high in April. The preliminary reading of the Thomson Reuters/University of Michigan index of sentiment dropped to 81.8 from 84.1, economists surveyed by Bloomberg said.

Federal Reserve Chair Janet Yellen said the U.S. economy has further to go to achieve full health and predicted small businesses will play a vital role in the recovery.

Job creation is “crucial to this process,” and small companies “are responsible for a large share” of new employment, Yellen said yesterday in Washington.

Fed policy makers said last month the economy is showing signs of picking up and the job market is improving. The central bank pared its monthly asset-buying and said further reductions in “measured steps” are likely. Interest rates will probably remain low until mid-2015.

Three rounds of monetary stimulus have helped fuel economic growth, sending the S&P 500 surging as much as 180 percent from its 2009 low.

The Chicago Board Options Exchange Volatility Index, a gauge for U.S. stock volatility known as the VIX, dropped 5.5 percent to 12.44. The measure has lost 3.7 percent this week.

Nine of the 10 main S&P 500 groups rose today,with phone shares surging as Verizon advanced 2.3 percent to $49.07 for the biggest gain in the Dow. Berkshire held 11 million Verizon shares as of March 31, Buffett’s company said yesterday in a regulatory filing.

The acceleration in home construction resulted in an increase of just 0.4 percent for an S&P index of homebuilders as starts on projects such as condominiums and apartment buildings accounted for almost all of the April gain.

Nordstrom jumped 15 percent to a record $70.55. The largest U.S. luxury department-store chain posted quarterly results that topped estimates, helped by sales at its lower-priced Rack outlets and online.

J.C. Penney Co. rallied 16 percent to $9.73. The department-store chain that’s posted more than $2.5 billion in losses the past three years reported its first quarterly sales gain since 2011. While the company is still losing money, the first-quarter loss was narrower than analysts expected, and the retailer bolstered its finances with a larger credit line.

Autodesk Inc. added 8.1 percent to $51.67. The maker of architectural and engineering software predicted annual sales will climb as much as 6 percent this year, up from an earlier forecast for as much as 5 percent. First-quarter revenue of $593 million beat the $568 million average analyst estimate compiled by Bloomberg.

Darden Restaurants dropped 4.3 percent to $48.49. The restaurant operator agreed to sell the Red Lobster seafood- restaurant chain to Golden Gate Capital for $2.1 billion, giving it an injection of cash and time to focus on reviving growth in its Olive Garden business.

Chesapeake Energy sank 4.7 percent to $27.64. The U.S. natural gas explorer that was on the verge of running out of cash two years ago plans to shrink its workforce by half to the smallest since 2006 in a rig spinoff by the end of next month.

World Wrestling Entertainment Inc. slumped 43 percent to $11.27 for the biggest drop since its debut in 1999. The company said its new online TV network that began operating Feb. 24 will need 1.3 million subscribers to make up for lost business. WWE predicted it will reach 1 million subscribers this year.

 

Have a wonderful weekend everyone.

 

Be magnificent!

The golden rule of conduct therefore, is mutual toleration,

seeing that we will never think alike and we shall see the Truth

in fragments and from different angles of vision.

Conscience is not the same thing for all.

While, therefore, it is a good guide for individual conduct,

imposition of that conduct upon all will be an insufferable interference

with everybody’s freedom of conscience.

Mahatma Gandhi, 1869-1948

As ever,

 

Carolann

 

Nearly all men can stand adversity, but if you want to test a man’s character,

give him power.

-Abraham Lincoln, 1809-1865

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

 

Dear Friends,

Tangents:

On this day in 1905, A.C. Benson wrote in his Diary:

I had one of the most curiously beautiful [bicycle] rides of my life.  I got to Milton: saw the church, in its green shade, with its elaborately written monuments, its glorious little window of Jacob, with hands like parsnips: then crossed the line, among the green pastures, so full of great thorn thickets: and then along the towpath, riding slowly down the Cam.  Such a sweet clear, fresh day.  I wound slowly along past Baitsbite and the Waterbeach bridge, into the heart of the fen.  The space below the towpath full of masses of cow-parsley: the river sapphire blue between the green banks – the huge fields running for miles to the right, with the long lines of dyke and lode; far away the blue tower of Ely, the brown roofs of Reach, and the low wolds of Newmarket.  It was simply enchanting!….So flat country, golden with buttercups, and the blue tree-clumps far away backed by hills, and over all the vast sky-perspective, is the most beautiful thing of all. –from The Book of Days.

Photos of the day

Overall leader Michael Matthews salutes fans prior to the start of the sixth stage of the Giro d’Italia, Tour of Italy cycling race, from Sassano to Montecassino, Italy. Gian Mattia D’Alberto/AP

Assistant trainer Alan Sherman (l.) stands alongside Kentucky Derby winner California Chrome, with exercise rider Willie Delgado aboard, before a workout as a layer of thick fog sits over Pimlico Race Course in Baltimore. The Preakness Stakes horse race is scheduled to take place May 17.Patrick Semansky/AP

Market Closes for May 15^th, 2014

Market Index	Close	Change
Dow Jones	16446.81	-167.16   -1.01%
S&P 500	1870.85	-17.68   -0.94%
NASDAQ	4069.292	-31.334   -0.76%
TSX	14588.89	-84.84
		-0.58%

International Markets

Market Index	Close	Change
NIKKEI	14298.21	-107.55
		-0.75%
HANG SENG	22730.86	+148.09
		+0.66%
SENSEX	23905.60	+90.48
		+0.38%
FTSE 100	6840.89	-37.60
		-0.55%

Bonds

Bonds	% Yield	Previous % Yield
CND. 10 Year Bond	2.259	2.287
CND. 30 Year Bond	2.797	2.832
U.S. 10 Year Bond	2.4964	2.5445
U.S. 30 Year Bond	3.3319	3.3750

Currencies

BOC Close	Today	Previous
Canadian $	0.91939	0.91883
US $	1.08768	1.08834
Euro Rate 1 Euro=		Inverse
Canadian $	1.49130	0.67056
US $	1.37107	0.72936

Commodities

Gold	Close	Previous
London Gold Fix	1296.63	1305.79
Oil	Close	Previous
WTI Crude Future	101.50	102.37
BRENT	109.360	109.360

Market Commentary:

Canada
By Eric Lam

May 15 (Bloomberg) — Canadian stocks fell the most in a week as commodity prices declined and CI Financial Corp. plunged after Bank of Nova Scotia said it will scale back its stake in the money manager.

CI Financial sank 3.2 percent, the most in two years, on concern Scotiabank may sell its $3.5 billion investment. Sherritt International Corp. tumbled 3.5 percent as nickel prices fell the most since 2011. Just Energy Group Inc. lost 9.8 percent after reporting lower earnings for the fourth quarter. Peyto Exploration & Development Corp. and Crew Energy Inc. paced losses in energy shares as natural gas prices slumped.

The Standard & Poor’s/TSX Composite Index fell 84.84 points, or 0.6 percent, to 14,588.89 at 4 p.m. in Toronto. The gauge has risen 7.1 percent this year.

“Of the big three sectors in Canada, it’s energy leading the downside with significant weakness,” said Tim Caulfield, a fund manager at Franklin Bissett Investment Management, on the phone from Calgary. He helps manage C$20 billion ($18.4 billion) with the firm. “One of the issues there is certainly the weaker natural gas quotes in May.”

Peyto Exploration retreated 3.8 percent to C$37.93 and Crew Energy lost 2 percent to C$10, the lowest level in a month, as energy shares tumbled 0.6 percent as a group. Nine of 10 industries in the S&P/TSX fell on trading volume 34 percent higher compared with the 30-day average.

Natural gas prices have plunged 28 percent since February, as Canada and the U.S. emerged from a severe winter. Crude in New York sank 0.9 percent today, retreating from a three-week high, after U.S. supplies rose to near record levels last week while output rose, the Energy Information Administration reported yesterday. Bellatrix Exploration Ltd. slumped 2.4 percent to C$10.15 and BlackPearl Resources Inc. sank 5.2 percent to C$2.37.

Just Energy, which sells natural gas and electricity to residential and commercial customers in Canada and the U.S., slumped 9.8 percent, the most since February 2013, to C$7.85. The company reported fourth-quarter profit from continuing operations of C$152.3 million, compared with C$199.8 million a year ago.

CI Financial tumbled 3.2 percent to C$34.98, the biggest decline since May 2012, after Scotiabank said yesterday it will reduce its holdings of the Toronto-based money manager. It first acquired a stake in CI Financial in 2008 and currently holds 37 percent of the company’s shares, according to the statement.

“This is very negative for CI,” Stephen Boland, analyst at GMP Securities LP, said in a note today. “This announcement will also create an overhang on the stock since no timing was given on the potential transaction.”

Sherritt International declined 3.5 percent to C$4.47 for a third day of losses and Teck Resources Ltd., Canada’s largest diversified miner, lost 1.5 percent to C$24.91. Nickel slumped as much as 9.7 percent in London, the most since 2011, extending a 4.6 percent decline yesterday amid speculation that a rally that lifted prices as much as 56 percent this year was exaggerated. Copper slipped 0.5 percent in New York.

The S&P/TSX Materials Index sank 1.6 percent, the biggest decline since March, as 48 of 52 members of the industry retreated.

Bombardier Inc. dropped 7.1 percent to C$3.90, the biggest loss since February, after Air Canada said it decided to keep its older jets instead of replacing them with the manufacturer’s CSeries models.

Air Canada dropped 3.8 percent to C$7.91, the lowest close in a week.

US
By Joseph Ciolli

May 15 (Bloomberg) — U.S. stocks fell a second day, with the Dow Jones Industrial Average sinking the most in a month, as investors continued to sell small-cap shares and Wal-Mart Stores Inc. forecast profit that missed estimates.

Wal-Mart fell 2.4 percent after the disappointing results. Lincoln National Corp. sank 5.2 percent, leading insurers lower as 10-year Treasury yields tumbled. General Motors Co. dropped 1.7 percent after recalling another 2.7 million vehicles. Cisco Systems Inc. advanced 6 percent after a revenue forecast that beat analysts’ projections.

The Standard & Poor’s 500 Index lost 0.9 percent, the most in a month, to 1,870.85 at 4 p.m. in New York. The Dow average declined 167.16 points, or 1 percent, to 16,446.81, its biggest drop since April 10. The Russell 2000 Index of small companies sank 0.7 percent, trimming an earlier slide of 1.9 percent. About 6.8 billion shares changed hands on U.S. exchanges, 2.3 percent above the three-month average.

“The primary sentiment right now is cautious and nervous,” Michael James, a Los Angeles-based managing director of equity trading at Wedbush Securities Inc., said in a phone interview. “It’s more a matter of capital preservation than it is trying to generate returns. This is a time of caution. More people are looking to make sales and raise cash than they are to put cash to work on the weakness.”

The S&P 500 has dropped 1.4 percent since closing at an all-time high of 1,897.45 on May 13. The gauge advanced as much as 4.5 percent from a low on April 11 amid optimism about the economy and Federal Reserve stimulus.

The Russell 2000 has lost 3.3 percent in the past three days following a 2.4 percent rally on May 12. The gauge briefly fell 10 percent below a March high today. A close with the index down that much would meet the common definition of a correction.

The Dow Jones Internet Index lost 0.6 percent for a third day of declines. The gauge has plunged 18 percent from a 13-year high in March.

Economic data today showed industrial production in the U.S. unexpectedly declined in April, held back by a plunge in utilities as temperatures warmed and a broad-based decrease in manufacturing. Manufacturing, which makes up 75 percent of total production, decreased 0.4 percent.

That contrasted with a higher-than-forecast reading on the Fed Bank of New York’s gauge of regional manufacturing, which climbed to 19.01 this month, from 1.29 in April.

Labor Department data showed the fewest Americans in seven years filed applications for unemployment benefits last week, while a separate report indicated the cost of living in the U.S. rose in April by the most in almost a year.

“There’s not really any great news here,” Randy Bateman, who oversees $3.5 billion as chief investment officer of Huntington Asset Advisors in Columbus, Ohio, said by phone. “It’s just a slower growing period. Unless we see something that will really drive investor enthusiasm, it’ll be a trading- range market.”

Fed Chair Janet Yellen said last week that the world’s biggest economy still requires a strong dose of stimulus. While data show “solid growth” in the second quarter, “many Americans who want a job are still unemployed” and inflation remains low, she said. Yellen will address the U.S. Chamber of Commerce after the market closes today.

Three rounds of monetary stimulus have helped fuel economic growth, sending the S&P 500 surging as much as 180 percent from its 2009 low.

David Tepper, founder of $20 billion hedge-fund firm Appaloosa Management LP, said he’s nervous about markets as the U.S. economy isn’t growing fast enough amid complacency by the Federal Reserve.

“The market is kind of dangerous in a way,” Tepper said yesterday at the SkyBridge Alternatives Conference in Las Vegas. “I think it’s nervous time,” he said, adding that markets may “grind higher” in the near term.

Tepper, 56, who started his Short Hills, New Jersey-based firm in 1993, said he’s more worried about deflation than inflation and that this is the time to preserve money.

The Chicago Board Options Exchange Volatility Index, a gauge for U.S. stock volatility known as the VIX, jumped 8.2 percent to 13.17, its biggest rally in a month. The gauge had fallen 43 percent through yesterday since reaching a two-year high on Feb. 3.

Nine of the 10 main S&P 500 groups retreated today, with commodity shares dropping 1.3 percent to pace declines. Phone stocks, which have the highest dividend yield in the index, added 0.2 percent.

Wal-Mart sank 2.4 percent to $76.83. The world’s largest retailer forecast second-quarter profit that missed analysts’ estimates as the company copes with slow sales in the U.S., especially at its Sam’s Club warehouse stores. First-quarter profit fell to $1.10 a share, with poor weather shaving off 3 cents a share. That trailed the $1.15-a-share estimate of analysts surveyed by Bloomberg.

Retailers in the S&P 500 fell 1.1 percent, with Kohl’s Corp. decreasing 3.4 percent to $52.21. The department-store operator reported sales and profit estimates that fell short of analysts’s forecasts. The stock fell the most since January.

Bristol-Myers Squibb Co. plummeted 6.1 percent to $48.93 for the biggest decline in the S&P 500. The drugmaker was downgraded to market perform from outperform by BMO Capital Markets after the company disclosed late yesterday preliminary results of clinical testing on one of its cancer treatments.

Lincoln National dropped 5.2 percent to $47.41 for its biggest slide since 2012, pacing losses among insurers, which sank 1.4 percent as a group.

The yield on 10-year Treasury notes slid five basis points to 2.50 percent. Life insurers invest in bonds to back future obligations and generate profits. MetLife Inc., the largest U.S. life insurer, sank 2.7 percent to $49.56.

General Motors dropped 1.7 percent to $34.36. The automaker announced that it is recalling an additional 2.7 million vehicles, including models with faulty brake lights that have led to hundreds of complaints, pushing the total number to 11.1 million.

Cisco rallied 6 percent to $24.18. The world’s largest network-equipment maker said revenue in the quarter ending July will be $12 billion to $12.3 billion. Analysts on average had predicted $11.8 billion. Cisco forecast profit excluding stock- based compensation, amortization and other items of as much as 53 cents a share. That exceeded the 51-cent average of analyst estimates compiled by Bloomberg.

 

Have a wonderful evening everyone.

 

Be magnificent!

Differentiation, infinitely contradictory, must remain,

But it is not necessary that we should hate each other;

it is not necessary therefore that we should fight each other.

Swami Vivekananda, 1863-1902

As ever,

 

Carolann

 

I had all the disadvantages required for success.

-Larry Ellison, 1944-

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

 

Dear Friends,

Tangents:

Full moon tonight.

On May 14, 1948, the independent state of Israel was proclaimed as British rule in Palestine came to an end.

1998 – Singer Frank Sinatra died at age 82.

1998 – The TV series “Seinfeld” aired its final episode.

2008 – The Interior Department declared the polar bear a threatened species because of the loss of Arctic sea ice.

Midnight sun until July 30^th, in Norway.

If you fill your mind to capacity with thoughts that you think are good and productive, you won’t have room for the bad ones. –Sir John Templeton, 1912-2008.

It was amazing to see the prices fetched at Christie’s Post War &  Contemporary Art Auction last night.  The highest bid was for a Barnett Newman – Black Fire I sold $84.1 million setting a new record for the artist.  Check it out at www.Christies.com.

Photos of the day

Tate Modern employees install Mark Rothko’s ‘Black on Maroon’ mural (r.) in London. The museum is putting ‘Black on Maroon’ back on display Tuesday, more than a year and a half after it was defaced with black ink by a vandal trying to draw attention to an obscure artistic movement. The gallery has spent 18 months working on the abstract painting, whose surface is made up of layers of oil, pigment, resin, egg, and glue. Lefteris Pitarakis/AP

Market Closes for May 14^th, 2014

Market Index	Close	Change
Dow Jones	16613.97	-101.47   -0.61%
S&P 500	1888.51	-8.94   -0.47%
NASDAQ	4100.629	-29.536   -0.72%
TSX	14663.05	-16.76
		-0.11%

International Markets

Market Index	Close	Change
NIKKEI	14405.76	-19.68
		-0.14%
HANG SENG	22582.77	+230.39
		+1.03%
SENSEX	23815.12	-56.11
		-0.24%
FTSE 100	6878.49	+5.41
		+0.08%

Bonds

Bonds	% Yield	Previous % Yield
CND. 10 Year Bond	2.287	2.355
CND. 30 Year Bond	2.832	2.889
U.S. 10 Year Bond	2.5445	2.6089
U.S. 30 Year Bond	3.3750	3.4438

Currencies

BOC Close	Today	Previous
Canadian $	0.91883	0.91671
US $	1.08834	1.09085
Euro Rate 1 Euro=		Inverse
Canadian $	1.49255	0.66999
US $	1.37140	0.72918

Commodities

Gold	Close	Previous
London Gold Fix	1305.79	1293.80
Oil	Close	Previous
WTI Crude Future	102.37	101.70
BRENT	109.360	109.360

Market Commentary:

Canada
By Gerrit De Vynck

May 14 (Bloomberg) — Canadian stocks were little changed after two days of gains as declines in technology and health- care companies offset increases among materials producers.

CGI Group Inc. and Celestica Inc. dropped at least two percent, falling the most among technology companies on the Standard & Poor’s/TSX Composite Index. Bear Creek Mining Corp. surged 35 percent after a Peruvian court threw out a government lawsuit against the company. Ainsworth Lumber Co. decreased 8.7 percent after Louisiana-Pacific Corp. scrapped its takeover of the company.

The S&P/TSX fell 6.08 points, or less than 0.1 percent, to 14,673.73 at 4 p.m. in Toronto. The gauge has climbed 7.7 percent this year. Health-care stocks sank 2 percent and technology companies declined 1.8 percent as a group.

The benchmark index was higher for most of the day, gaining as much as 0.2 percent. It dropped in the final hour of trading as energy shares reversed an advance, falling 0.2 percent as a group.

Investors are nervous about whether or not the year’s rally in Canadian energy stocks will continue, said Mike O’Brien, a fund manager with TD Asset Management Inc. in Toronto.

“There’s a lot of uncertainty as to where it’s going to go and whether crude prices break higher or lower from here,” O’Brien said by phone. “My perspective is I don’t think oil prices are going to fall out of bed.” TD manages about C$218 billion ($200 billion).

Materials companies rose 0.9 percent as a group, the most out of 10 industries in the benchmark index, as the price of gold climbed 0.9 percent $1,305.90 an ounce.

Eldorado Gold Corp. jumped 3 percent to C$6.58 and Yamana Gold Inc. added 5.4 percent to C$8.24 to lead advances among gold producers.

Bear Creek Mining advanced 35 percent to C$2 after rising as much as 45 percent, the most since 2005. A Peruvian court said a ruling from the government to take away the company’s rights to a mine was unconstitutional. The court restored Bear Creek’s status as the property’s owner and said the project was in the country’s interest, according to a statement from Bear Creek.

Ainsworth Lumber fell 8.7 percent to $3.15. Louisiana- Pacific called off its C$951 million takeover of the Vancouver- based company after regulators said further asset sales were necessary.

Valeant Pharmaceuticals International Inc. dropped 2.3 percent to C$138.22 after saying it plans to sweeten its rejected cash-and-stock offer for Botox maker Allergan Inc. after talking to investors of the targeted company.

Badger Daylighting Ltd., an excavating company, retreated 2.8 percent to C$36 after saying first-quarter earnings per share fell compared to the same period last year.

SunOpta Inc. increased 12 percent to C$13.78 after reporting first-quarter earnings that beat analyst estimates.  SunOpta distributes natural and organic food.

Torc Oil & Gas Ltd. gained 4.5 percent to C$13.61 after boosting its forecast for 2014 production.

Sears Canada Inc. rose 3.4 percent to C$16.30 after Sears Holdings Corp. said it is considering selling the Canadian unit, which has a market value of $1.5 billion.

US
By Joseph Ciolli

May 14 (Bloomberg) — U.S. stocks fell, sending benchmark indexes down from all-time highs, as investors resumed selling in small-cap and Internet shares.

Groupon Inc. sank 4.4 percent to lead the Dow Jones Internet Index lower by 1.2 percent. Fossil Group Inc. fell 10 percent after the maker of watches and accessories forecast earnings that trailed analysts’ estimates. Deere & Co. slid 2 percent after cutting its full-year revenue projection. International Business Machines Corp. lost 1.8 percent to pace declines among large companies.

The Standard & Poor’s 500 Index dropped 0.5 percent to 1,888.53 at 4 p.m. in New York, ending a three-day rally. The Dow Jones Industrial Average lost 101.47 points, or 0.6 percent, to 16,613.97, halting five days of gains. The Russell 2000 Index of small stocks sank 1.6 percent after yesterday sliding 1.1 percent. About 5.4 billion shares changed hands on U.S. exchanges, 19 percent below the three-month average.

“The market is taking a bit of a breather,” Bill Schultz, chief investment officer who oversees about $1.1 billion at McQueen Ball & Associates in Bethlehem, Pennsylvania, said in a phone interview. “Earnings have been OK, but now we’re in a slow period. We’re going to have to see earnings pick up to get us to the next level on stocks.”

The S&P 500 rebounded 4.5 percent from its low on April 11 through yesterday, recovering declines after a selloff in technology and small-cap stocks overshadowed optimism about the strength of the economy. The equities benchmark briefly surpassed 1,900 for the first time yesterday, ending the day little changed at an all-time high of 1,897.45. The Dow also finished yesterday at a record.

The Russell 2000 has fallen 2.7 percent in the past two days, extending its drop from a March high to 8.7 percent. The gauge retreated 1.9 percent last week to close below its average price for the past 200 days for the first time since 2012. The Dow Jones Internet Index has plunged 17 percent from a 13-year high in March.

“There’s potential for people to take profits as we reach this record-high area,” Joe Bell, senior equity analyst at Cincinnati-based Schaeffer’s Investment Research Inc., said in a phone interview. “When you get these run-ups, people start to look at economic data, and we haven’t exactly had a great run over the last month. People were expecting a pickup following a tough winter.”

Data today showed wholesale prices in the U.S. rose in April by the most in more than a year, reflecting broad-based gains that signal the threat of deflation is ebbing as the economy improves.

A report yesterday showed retail sales climbed 0.1 percent last month, as consumers were less inclined to ramp up spending again after March saw a release of pent-up demand caused by harsh winter weather.

Federal Reserve Chair Janet Yellen will speak tomorrow after saying last week the world’s biggest economy still requires a strong dose of stimulus. She told U.S. lawmakers that while data show “solid growth” in the second quarter, “many Americans who want a job are still unemployed” and inflation remains low.

Three rounds of monetary stimulus have helped fuel economic growth, sending the S&P 500 surging as much as 180 percent from its 2009 low.

Macy’s Inc., Wal-Mart Stores Inc. and Kohl’s Corp. are among 12 companies in the S&P 500 scheduled to disclose results this week, giving investors insight into how retailers performed during the winter months.

Among the 457 companies in the S&P 500 that have posted results this earnings season, 76 percent beat analysts’ estimates for profits and 53 percent exceeded sales projections, according to data compiled by Bloomberg.

Investors have also been watching developments in Ukraine, where rebels yesterday killed seven government soldiers and wounded eight others during an ambush in a breakaway eastern region.

The country “is as close to civil war as you can get,” Russian Foreign Minister Sergei Lavrov said in an interview today with Bloomberg Television. Russia has “no intention” of send its troops anywhere, he said. The country is locked in the worst standoff since the end of the Cold War against the U.S. and Europe over Ukraine in the run-up to presidential elections later this month.

The Chicago Board Options Exchange Volatility Index, a gauge for U.S. stock volatility known as the VIX, added 0.3 percent to 12.17. The gauge has fallen 43 percent since reaching a two-year high on Feb. 3 and closed yesterday at the lowest since August.

Five of the 10 main S&P 500 groups retreated today, with consumer-discretionary stocks losing 1.1 percent to pace declines. Phone shares added 0.5 percent.

IBM slid 1.8 percent to $188.72 for the steepest slide in the Dow. Chief Executive Officer Ginni Rometty spoke to Wall Street analysts today, saying she remains confident in the company’s 2015 profit forecast despite tumbling sales in hardware and emerging markets like China.

Fossil lost 10 percent to $100 for the biggest drop in the S&P 500. Second-quarter earnings will be 90 cents to 97 cents a share, the company said after the close of trading yesterday. Analysts had projected $1.16. The company predicted sales growth of 8 percent to 9.5 percent, also missing the 10 percent average estimate.

Deere fell 2 percent to $91.70. The largest agricultural- equipment maker said equipment sales will drop by about 4 percent for 2014, compared with a previous projection for a decline of about 3 percent. Equipment sales in the quarter through April slid to $9.25 billion from $10.3 billion, missing the average analyst estimate.

Sears Holdings Corp. fell 5.9 percent to $40.70 after saying it is considering a divestment of its 51 percent interest or the sale of Sears Canada as a whole.

 

Have a wonderful evening everyone.

 

Be magnificent!

To love is to understand and feel that the other person is different.

Swami Prajnanpad, 1891-1974

As ever,

 

Carolann

 

We would accomplish many more things if we did not

think of them as impossible.

-Vince Lombardi, 1913-1970

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

 

Dear Friends,

Tangents:

The guys on Car Talk – terrific show on NPR on Saturday mornings, read this letter to their audience last Saturday.  Applicants to NYU must submit an essay with their applications.

This is an actual essay written by a college applicant to NYU. The author was accepted and is now attending NYU.

3A. IN ORDER FOR THE ADMISSIONS STAFF OF OUR COLLEGE TO GET TO KNOW YOU, THE APPLICANT,  BETTER, WE ASK THAT YOU ANSWER THE FOLLOWING QUESTION: ARE THERE ANY SIGNIFICANT EXPERIENCES YOU HAVE HAD, OR ACCOMPLISHMENTS YOU HAVE REALIZED, THAT HAVE HELPED TO DEFINE YOU AS A PERSON?

I am a dynamic figure, often seen scaling walls and crushing ice. I have been known to remodel train stations on my lunch breaks, making them more efficient in the area of heat retention. I translate ethnic slurs for Cuban refugees, I write award-winning operas, I manage time efficiently.

Occasionally, I tread water for three days in a row.

I woo women with my sensuous and godlike trombone playing, I can pilot bicycles up severe inclines with unflagging speed, and I cook Thirty-Minute Brownies in twenty minutes. I am an expert in stucco, a veteran in love, and an outlaw in Peru.

Using only a hoe and a large glass of water, I once single-handedly defended a small village in the Amazon Basin from a horde of ferocious army ants. I play bluegrass cello, I was scouted by the Mets, I am the subject of numerous documentaries. When I’m bored, I build large suspension bridges in my yard. I enjoy urban hang gliding. On Wednesdays, after school, I repair electrical appliances free of charge.

I am an abstract artist, a concrete analyst, and a ruthless bookie. Critics worldwide swoon over my original line of corduroy evening wear. I don’t perspire. I am a private citizen, yet I receive fan mail. I have been caller number nine and have won the weekend passes. Last summer I toured New Jersey with a traveling centrifugal-force demonstration. I bat 400.

My deft floral arrangements have earned me fame in international botany circles. Children trust me.

I can hurl tennis rackets at small moving objects with deadly accuracy. I once read Paradise Lost, Moby Dick, and David Copperfield in one day and still had time to refurbish an entire dining room that evening. I know the exact location of every food item in the supermarket. I have performed several covert operations with the CIA. I sleep once a week; when I do sleep, I sleep in a chair. While on vacation in Canada, I successfully negotiated with a group of terrorists who had seized a small bakery. The laws of physics do not apply to me.

I balance, I weave, I dodge, I frolic, and my bills are all paid. On weekends, to let off steam, I participate in full-contact origami. Years ago I discovered the meaning of life but forgot to write it down. I have made extraordinary four course meals using only a mouli and a toaster oven.

I breed prizewinning clams. I have won bullfights in San Juan, cliff-diving competitions in Sri Lanka, and spelling bees at the Kremlin.

I have played Hamlet, I have performed open-heart surgery, and I have spoken with Elvis.

But I have not yet gone to college.

Photos of the day

A ‘Maya’ girl sits on an altar during the traditional celebration of ‘Las Mayas’ on a street, in central Madrid, Spain. The festival originates from pagan traditions and dates back to the medieval age, taking place annually at the beginning of May to celebrate the beginning of spring. Daniel Ochoa de Olza/AP

Dark clouds hang over flowers on a dyke at the river Oder near Reitwein, eastern Germany. Patrick Pleul/AP

Market Closes for May 12^th, 2014

Market   Index	Close	Change
Dow   Jones	16695.47	+112.13    +0.68%
S&P 500	1896.65	+18.17    +0.97%
NASDAQ	4143.859	+71.990    +1.77%
TSX	14654.94	+120.88
		+0.83%

International Markets

Market   Index	Close	Change
NIKKEI	14149.52	-50.07
		-0.35%
HANG   SENG	22261.61	+398.62
		+1.82%
SENSEX	23551.00	+556.77
		+2.42%
FTSE 100	6851.75	+37.18
		+0.55%

Bonds

Bonds	% Yield	Previous % Yield
CND.   10 Year Bond	2.400	2.359
CND.   30 Year Bond	2.923	2.895
U.S.   10 Year Bond	2.6557	2.6215
U.S.   30 Year Bond	3.4907	3.4659

Currencies

BOC Close	Today	Previous
Canadian $	0.91784	0.91751
US   $	1.08952	1.08990
Euro Rate   1 Euro=		Inverse
Canadian   $	1.49902	0.66710
US   $	1.37585	0.72682

Commodities

Gold	Close	Previous
London Gold   Fix	1296.50	1289.19
Oil	Close	Previous
WTI Crude Future	100.59	100.06
BRENT	109.360	109.360

Market Commentary:

Canada
By Gerrit De Vynck

May 12 (Bloomberg) — Canadian stocks rose, after their worst weekly drop since June, as rallies in the price of copper and gold boosted mining companies.

Lundin Mining Corp. rose 6 percent and Thompson Creek Metals Company Inc. gained 7.7 percent as copper rose as much as  2.4 percent, the most since December. Valeant Pharmaceuticals International Inc. fell as Allergan Inc. rejected the drugmaker’s unsolicited takeover offer. Canadian Tire Corp. fell 1 percent after Credit Suisse cut the stock to the equivalent of a sell.

The Standard & Poor’s/TSX Composite Index rose 120.88 points, or 0.8 percent, to 14,654.94 at 4 p.m. in Toronto, the largest increase since April 16. Investors are jumping back into the market after being spooked by a sell-off in energy companies last week, said Bruce Campbell fund manager at StoneCastle Investment Management Inc.

“There certainly seemed like there were moments last week of the first little inklings of panic,” he said by phone from Kelowna, British Columbia. His firm manages about C$100 million ($92 million). Today the market is making up for that panicked selling, he said.

Energy companies fell 2.6 percent last week after rising 15 percent from January to the end of April. Mining companies in the Canadian benchmark index rose 1.5 percent as a group today, the most since May 2.

Gold for June delivery rose 0.6 percent to $1,295.80 an ounce after rising as much as 1.3 percent as Russian President Vladimir Putin said he respected the results of referendums in eastern Ukraine which separatists said were in favor of independence.

Copper producers including Lundin, Thompson Creek, Nevada Copper Corp., Western Copper and Gold Corp. and Copper Mountain Mining Corp. all rose at least 6 percent.

Valeant Pharmaceuticals fell 0.7 percent to C$141.98 after Allergan said Valeant’s offer “substantially undervalues” the company. Valeant is trying to buy the Botox producer with the help of Bill Ackman’s Pershing Square Capital Management LP, Allergan’s biggest shareholder.

Canadian Tire fell 1 percent to C$110.19 as Credit Suisse downgraded it. The retailer sold 20 percent of its banking business to Bank of Nova Scotia last week for $500 million in cash.

UrtheCast Corp. fell 9.6 percent to C$1.32 after reporting a first quarter loss of 6 Canadian cents per share. The Vancouver-based space imaging company also released a new photo of Earth today taken from its camera on the International Space Station.

Alliance Grain Traders Inc. rose 4.2 percent to $18.99 after reporting higher first quarter revenue than the same period last year. Alliance Grain Traders processes markets beans, peas and lentils.

Athabasca Oil Corp. dropped 5.6 percent to C$7.28, the most since October, after GMP Securities LP cut its rating on the oil sands producer to hold from buy. The Calgary-based company has risen 12 percent so far this year.

US
By Joseph Ciolli

May 12 (Bloomberg) — U.S. stocks climbed, pushing benchmark indexes to records, after Internet and small-cap shares rallied amid deals activity that boosted confidence in the world’s largest economy.

Salesforce.com Inc. and TripAdvisor Inc. jumped at least 5.8 percent as all 41 members in the Dow Jones Internet Index rose. The gauge surged 3 percent after last week plunging 3.6 percent. 21st Century Fox Inc. jumped 3.1 percent after reports that Rupert Murdoch’s British Sky Broadcasting Group Plc is in talks to buy European pay TV assets from Fox. Pinnacle Foods Inc. surged 13 percent after Hillshire Brands Co. agreed to buy it for about $6.6 billion including debt.

The Standard & Poor’s 500 Index rose 1 percent to 1,896.65 at 4 p.m. in New York, rising above its record from April 2. The Dow Jones Industrial Average added 112.13 points, or 0.7 percent, to 16,695.47, extending an all-time high. The Nasdaq Composite Index surged 1.8 percent, the most since January, to trim its decline this year to 0.8 percent. About 5.7 billion shares changed hands on U.S. exchanges, 13 percent below the three-month average.

“The global economy is accelerating, central banks are dovish, companies are making acquisitions and it’s hard to see what could keep the market down from here,” said Allan von Mehren, chief analyst at Danske Bank A/S in Copenhagen.

The S&P 500 has rallied 4.5 percent from an April 11 low, recovering all of its losses after a selloff in technology and small-cap stocks that overshadowed optimism about the strength of the economy. Tech shares in the index jumped 1.5 percent today.

While the Nasdaq has recovered 3.6 percent from its April low, it remains 4.9 percent below a 13-year high in March. Netflix Inc., which fell as much as 31 percent from its record two months ago, rallied 5.1 percent today.

Some of the technology shares hardest hit last week rebounded today. Twitter Inc. added 5.9 percent after falling 18 percent last week, the most since its initial public offering in November. Facebook Inc. rose 4.5 percent following a 5.3 percent drop last week. Yahoo! Inc. gained 2 percent after slumping 8.4 percent last week, the most since September 2011.

“We’re seeing a little bit of a bounce back from some of the stocks that got hit the most over the last couple weeks,” Terry Morris, a senior equity manager who helps oversee about $2.8 billion at Wyomissing, Pennsylvania-based National Penn Investors Trust Co., said in a phone interview. “We’ve had a big divergence between large cap versus small cap, and growth versus value. If you look at the Russell 2000 and some of the technology or Internet-related stocks, they’ve really taken a pounding.”

About 76 percent of the 453 S&P 500 companies that have released results this earnings season have beaten estimates for profit, while 53 percent have exceeded revenue projections, data compiled by Bloomberg show.

Profit at the companies will probably rise 7.2 percent this year, as sales will climb 4 percent, according to analysts’ estimates compiled by Bloomberg.

Retailers including Macy’s Inc., Kohl’s Corp. and Nordstrom Inc. are among companies scheduled to disclose results this week. Investors will also scrutinize data on retail sales tomorrow.

Data last week showed services, the biggest chunk of the economy, picked up in April while fewer Americans than forecast filed applications for unemployment benefits, a sign the labor market continues to gain traction.

“Profits from the latest quarterly reporting season have exceeded expectations, while the outlook for the U.S. economy looks increasingly positive,” said Richard Hunter, head of equities at Hargreaves Lansdown Plc in London.

Russia indicated it “respects” the results of two disputed referendums in eastern Ukraine, which separatists said backed independence, while the European Union added companies to its list of sanctions for the first time.

Russia praised the high turnout in yesterday’s ballots, according to a statement e-mailed today by President Vladimir Putin’s press service. The U.S. and the EU deem the votes illegal and the government in Kiev called them a “farce.” Donetsk showed 90 percent backing for the breakaway plan, while in Luhansk, 94 percent to 98 percent supported autonomy with turnout at 75 percent, Russia’s state-run RIA Novosti reported.

The Chicago Board Options Exchange Volatility Index, a gauge for U.S. stock volatility known as the VIX, fell 5.34 percent today to 12.23, the lowest level since Jan. 10. The gauge has fallen 43 percent since reaching a two-year high on Feb. 3.

Eight of the 10 main S&P 500 groups advanced today. Producers of raw materials rallied 1.3 percent to pace gains, as Alcoa Inc. gained 4.2 percent. United Technologies Corp. and General Electric Co. rose at least 1.4 percent as industrial shares advanced.

21st Century Fox Class A shares added 3.1 percent to $35.19. BSkyB, 39 percent owned by Fox, said today it’s in talks to buy the Italian and German pay-TV assets of Fox. Such a deal, for control of satellite carriers Sky Italia and Sky Deutschland AG, would be valued at about 10 billion euros ($14 billion), people with knowledge of the matter told Bloomberg News, which reported the talks on May 9. Fox has about 57 percent of Sky Deutschland and 100 percent of Sky Italia.

Hillshire Brands fell 3.2 percent to $35.76. The maker of Jimmy Dean sausages and Sara Lee frozen bakery goods agreed to pay $18 in cash for each Pinnacle Foods share plus 0.5 shares of Hillshire Brands stock, Chicago-based Hillshire and Pinnacle said today in a statement. Pinnacle Foods shares jumped 13 percent to $34.47.

RadioShack Corp. rose 4.5 percent to $1.39. Standard General reported a 9.8 percent stake in the electronics chain, up from a 4.83 percent at the end of December.

RadioShack, which said in March it would close as many as 1,100 locations to cut costs, is proceeding with a plan to shut fewer stores because of a snag with its lender agreements.

Vantiv Inc. gained 3.1 percent to $29.82. The payment- processing company is near a deal to acquire Mercury Payment Systems Inc. for about $1.65 billion, people familiar with the matter said.

Allergan Inc. slipped 1 percent to $159.72. The maker of the Botox wrinkle treatment said Valeant Pharmaceuticals International Inc.’s offer “substantially undervalues” the company. The bid, which valued Allergan at $45.7 billion in cash and stock when it was announced, creates “significant risks and uncertainties” and isn’t in the best interest of shareholders, the Irvine, California-based company said in a statement today.

 

Have a wonderful evening everyone.

 

Be magnificent!

If you do not think he is different, he is unique, he exists in his own right,

there cannot be any relationship.

Swami Prajnanpad, 1891-1974

As ever,

 

Carolann
Things do not change, we do.

-Henry David Thoreau, 1817-1862

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

 

Dear Friends,

Tangents:

Mother, English
Matr, Sanskrit
Meter, Greek
Mater, Latin
Modor, Old English
Mutter, German
Mere, French
Mat, Russian

Disobedience

A.A. Milne

James James
Morrison Morrison
Weatherby George Dupree
Took great
Care of his Mother,
Though he was only three.
James James
Said to his Mother,
“Mother,” he said, said he;
“You must never go down to the end of the town,
if you don’t go down with me.”
James James
Morrison’s Mother
Put on a golden gown,
James James
Morrison’s Mother
Drove to the end of the town.
James James
Morrison’s Mother
Said to herself, said she:
“I can get right down to the end  of the town
and be back in time for tea.”
King John
Put up a notice,
“LOST  or  STOLEN or STRAYED!
JAMES JAMES
MORRISON’S MOTHER
SEEMS TO HAVE BEEN MISLAID.
LAST SEEN
WANDERING VAGUELY:
QUITE OF HER OWN ACCORD,
SHE TRIED TO GET DOWN TO THE END OF THE TOWN-
FORTY SHILLINGS REWARD!”
James James
Morrison Morrison
(Commonly known as Jim)
Told his
Other relations
Not to go blaming him.
James James
Said to his Mother,
“Mother,” he said, said he:
“You must never go down to the end of the town
without consulting me.”
James James
Morrison’s mother
Hasn’t been heard of since.
King John
Said he was sorry,
So did the Queen and Prince.
King John
(somebody told me)
Said to a man he knew:
“If people go down to the end of the town, well,
what can anyone do?”
(Now then, very softly)
J.J.
M.M.
W.G.Du P.
Took great
c/o his M*****
though he was only 3.
J.J.
Said to his M*****
“M*****,” he said, said he:
“You-must-never-go-down-to-the-end-of-the-town-
if-you-don’t-go-down-with ME!”

-from Caroline Kennedy’s Poems to Learn by Heart, Disney Hyperion Books.

HAPPY MOTHER’S DAY TO ALL THE MOTHERS READING THIS!

Photos of the day

Kate Moon points out a couple of airborn balloons to her son, Oliver Moon, 17 months held by Corky York during the Balloon Stampede event in Walla Walla, Wash. Greg Lehman/Walla Walla Union-Bulletin/AP

A Lemur catta, also known as ring-tailed lemur, with its three-week-old cub clinging to its back sits on a tree at the Schoenbrunn zoo in Vienna.Heinz-Peter Bader/Reuters

Market Closes for May 9^th, 2014

Market   Index	Close	Change
Dow   Jones	16583.34	+32.37    +0.20%
S&P 500	1877.97	+2.34    +0.12%
NASDAQ	4071.870	+20.374    +0.50%
TSX	14525.62	-20.41
		-0.14%

International Markets

Market   Index	Close	Change
NIKKEI	14199.59	+35.81
		+0.25%
HANG   SENG	21862.99	+25.87
		+0.12%
SENSEX	22994.23	+650.19
		+2.91%
FTSE 100	6814.57	-24.68
		-0.36%

Bonds

Bonds	% Yield	Previous % Yield
CND.   10 Year Bond	2.359	2.371
CND.   30 Year Bond	2.895	2.896
U.S.   10 Year Bond	2.6215	2.6125
U.S.   30 Year Bond	3.4659	3.4320

Currencies

BOC Close	Today	Previous
Canadian $	0.91751	0.92334
US   $	1.08990	1.08303
Euro Rate   1 Euro=		Inverse
Canadian   $	1.49943	0.66692
US   $	1.37575	0.72688

Commodities

Gold	Close	Previous
London Gold   Fix	1289.19	1288.66
Oil	Close	Previous
WTI Crude Future	100.06	100.26
BRENT	109.360	109.360

Market Commentary:

Canada
By Gerrit De Vynck

May 9 (Bloomberg) — Canadian stocks fell, giving the benchmark equities index the worst weekly drop since June, as employment declined and BlackPearl Resources Inc. tumbled for a second day after cutting its estimate for oil production.

BlackPearl slid 11 percent, adding to yesterday’s 9.5 percent slump. CIBC cut the stock’s rating to sector perform, the equivalent of neutral, from sector outperform. Crew Energy Inc. and Bellatrix Exploration Ltd. dropped at least 5 percent, leading declines among oil companies in the Standard & Poor’s/TSX Composite Index. Cineplex Inc., an operator of movie theaters, gained 3.1 percent after RBC Capital Markets recommended buying the shares.

The S&P/TSX fell 11.97 points, or 0.1 percent, to 14,534.06 at 4 p.m. in Toronto. Volume was 10 percent below the 30-day average, data compiled by Bloomberg show. The Canadian equity benchmark lost 1.6 percent this week, the most since June.

“Because the volumes are down and many investors are still unsure of themselves, you’re finding greater moves in the marketplace, much more volatility,” said Irwin Michael, fund manager at ABC Funds in Toronto. His firm manages about C$900 million ($825 million).

Employment fell by 28,900 in April, Statistics Canada said today in Ottawa. The unemployment rate remained at 6.9 percent as 25,600 people also left the labor force, reducing the participation rate to the lowest since November 2001. Economists surveyed by Bloomberg News projected a 13,500 job increase and a jobless rate unchanged at 6.9 percent, according to median forecasts.

IGM Financial Inc. decreased 0.5 percent to C$54.16 after reporting first-quarter earnings that missed analyst estimates.  The company’s revenue exceeded estimates.

Nautilus Minerals Inc., which plans to mine the ocean floor, rose 13 percent to 53 Canadian cents after Papua New Guinea paid for its share of the company’s main project. Earlier in the day Nautilus rose by as much as 32 percent.

K-Bro Linen Inc. slipped 3.1 percent to C$39. The company reported first-quarter profit that missed some analyst estimates.

US
By Joseph Ciolli

May 9 (Bloomberg) — U.S. stocks rose, sending the Dow Jones Industrial Average to a record, as Internet shares rebounded after a three-day selloff and Gap Inc. led retailers higher.

Groupon Inc. and LinkedIn Corp. rose more than 2.5 percent to pace gains among Internet stocks. Gap surged 3.3 percent amid an unexpected increase in April sales. Symantec Corp. rose 3.3 percent as its sales forecast exceeded analysts’ predictions. CBS Corp. fell 2.2 percent after posting quarterly revenue that missed estimates. Ralph Lauren Corp. slipped 2.1 percent as it forecast sales below analysts estimated.

The S&P 500 rose 0.2 percent to 1,878.48 at 4 p.m. in New York. The Dow increased 32.37 points, or 0.2 percent, to 16,583.34, topping its previous record close reached April 30. The Russell 2000 Index of small stocks added 0.9 percent. The Nasdaq Composite Index climbed 0.5 percent. About 5.8 billion shares changed hands on U.S. exchanges, 13 percent below the three-month average.

“The market is just trying to find footing,” Jerry Braakman, chief investment officer of First American Trust in Santa Ana, California, said in a phone interview. His firm manages $1.1 billion. “You’ve seen the market changing its mind throughout the day quite a bit recently. That’s indicative of people trying to search for direction.”

Today’s gain trimmed the S&P 500’s loss for the week to 0.1 percent. The technology-heavy Nasdaq Composite tumbled 1.3 percent, its biggest weekly drop in a month.

The Dow Jones Internet Composite Index rose 1.3 percent today, its first gain in four days. The gauge tumbled 3.6 percent for the week, led by declines of more than 15 percent in Twitter Inc. and Groupon.

Small-caps and Internet shares such as Facebook Inc. and Amazon.com Inc. have been the biggest victims of the market retreat that began two months ago as investors fled last year’s best-performing equities. The Russell 2000 has fallen 8.4 percent from a March 4 record amid concern that prices have outrun earnings.

The Nasdaq Composite is trading at 34.8 times reported earnings, double the multiple of 17.2 for the broad equity measure.

Of the 453 S&P 500 constituents that have released results this earnings season, 76 percent have beaten estimates for profit, while 53 percent have exceeded projections for revenue, data compiled by Bloomberg show. The index’s members increased their earnings by 5.5 percent and their sales by 3 percent in the first quarter, according to analysts surveyed by Bloomberg.

The Chicago Board Options Exchange Volatility Index, a gauge for U.S. stock volatility known as the VIX, fell 3.8 percent today to 12.92, after rising 4.5 percent earlier in the day. The gauge added 0.1 percent for the week.

Six out of 10 groups in the S&P 500 rose. Consumer and health-care companies had the best performance, advancing more than 0.5 percent. Technology shares added 0.2 percent as a group. Utilities had the biggest decline, losing 1.4 percent.

Groupon climbed 7 percent to $6.05. The shares, which rose 142 percent in 2013, dropped as much as 56 percent from this year’s high on Jan. 3. LinkedIn, which rallied 89 percent last year, increased 2.5 percent to $148.69. The shares are down 31 percent in 2014.

Netflix Inc. rose 2.1 percent to $328.55, trimming its loss for the week to 3.6 percent. TripAdvisor Inc., Google Inc. and Amazon.com climbed at least 1.2 percent today.

Gap jumped 3.3 percent to $40.52. The apparel maker posted preliminary first-quarter profit that topped analysts’ estimates. Sales in April were led by an 18 percent gain at Old Navy, the retailer’s value-focused brand.

Symantec gained 3.3 percent to $20.79 as the maker of security software forecast first-quarter sales of $1.65 billion to $1.69 billion. Analysts on average had projected $1.64 billion. In the fourth quarter, which ended March 28, net income rose to 31 cents a share from 27 cents a year earlier.

CBS declined 2.2 percent to $56.74 after the owner of the most-watched U.S. television network said first-quarter sales fell 4.6 percent to $3.86 billion. Analysts had predicted $3.92 billion. Advertising revenue dropped 12 percent in the period.

Ralph Lauren lost 2.1 percent to $148.81. Retailers have been deepening discounts and seeking to create new styles to attract shoppers amid shaky consumer confidence and flagging mall traffic. Ralph Lauren said sales at stores open at least a year fell 2 percent in the quarter through March 29, hurt by unseasonably cold weather.

 

Have a wonderful weekend everyone.

 

Be magnificent!

Expansion is life; contraction is death.

Love is life, hatred is death.

We began to die the day we began to contract, to hate others

and nothing can prevent our death,

until we come back to life, to expansion.

Swami Vivekananda, 1863-1902

As ever,

 

Carolann

 

Competitors weren’t designed to fall in love

with each other.

-Bill Gates, 1955-

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

 

Dear Friends,

Tangents:

VE on this day in 1945.

Resurgent May, softness with energy,
Warmth after cold, reunion after loss.
It is a columbarium full of doves,
A susurration of the living leaves….

-Vita Sackville-West, The Garden.

Photos of the day

A bald eagle sits with it’s eaglet in a nest over the Raccoon River at Grays Lake Park in Des Moines, Iowa. Charlie Neibergall/AP

A surfer holding her board wades through the surf as clouds above are lit by the setting sun at Mollymook Beach on the south coast of New South Wales. David Gray/Reuters

Market Closes for May 8^th, 2014

Market Index	Close	Change
Dow Jones	16550.97	+32.43   +0.20%
S&P 500	1875.63	-2.58   -0.14%
NASDAQ	4051.496	-16.177   -0.40%
TSX	14546.95	-109.45
		-0.75%

International Markets

Market Index	Close	Change
NIKKEI	14163.78	+130.33
		+0.93%
HANG SENG	21837.12	+90.86
		+0.42%
SENSEX	22344.04	+20.14
		+0.09%
FTSE 100	6839.25	+42.81
		+0.63%

Bonds

Bonds	% Yield	Previous % Yield
CND. 10 Year Bond	2.371	2.378
CND. 30 Year Bond	2.896	2.899
U.S. 10 Year Bond	2.6125	2.5878
U.S. 30 Year Bond	3.4320	3.4017

Currencies

BOC Close	Today	Previous
Canadian $	0.92334	0.91755
US $	1.08303	1.08986
Euro Rate 1 Euro=		Inverse
Canadian $	1.49890	0.66716
US $	1.38400	0.72254

Commodities

Gold	Close	Previous
London Gold Fix	1288.66	1289.95
Oil	Close	Previous
WTI Crude Future	100.26	100.77
BRENT	109.360	109.360

Market Commentary:

Canada
By Gerrit De Vynck and Eric Lam

May 8 (Bloomberg) — Canadian stocks fell for the third time in four days as energy shares slid the most in almost a year after BlackPearl Resources Inc. cut its oil production forecast and crude prices declined.

BlackPearl, an oil and gas exploration company, retreated 9.5 percent. Crew Energy Inc. and Birchcliff Energy Ltd. fell at least 7.3 percent. Linamar Corp., a maker of auto parts, advanced 12 percent after reporting higher-than-estimated profit. Mitel Networks Corp. gained 13 percent after saying it would save more money from its merger with Aastra Technologies Ltd. than originally projected.

The Standard & Poor’s/TSX Composite Index fell 110.37 points, or 0.8 percent, to 14,546.03 at 4 p.m. in Toronto, the worst drop in four weeks. Energy stocks fell 2.2 percent as a group, the biggest decline since last June. The decline pared the industry’s gain this year to 13 percent.

“The market got very concentrated in the performance of energy and obviously it’s a profit taking wave that sort of fed on itself,” said Bob Decker, a fund manager at Aurion Capital Management Inc. in Toronto. His firm manages about C$6.6 billion.

West Texas Intermediate crude dropped, after rallying yesterday the most in a month, as supplies climbed to a seasonal record high amid weak demand.

“I don’t see anything fundamentally that changed dramatically other than the fact that stocks are overbought and it’s a technical correction,” Decker said. “Usually bull market corrections like this are short and sharp.”

BlackPearl Resources plunged 9.5 percent to C$2.77, the most since July. Macquarie Research cut its rating on the stock to neutral, the equivalent of a hold, from outperform. The company reported first-quarter production short of his projections, according to a note by analyst Chris Feltin.  “We see better growth from other mid-caps in our coverage,” he said.

Canada’s equity benchmark trades for 20 times reported earnings, the highest level since 2011, data compiled by Bloomberg show. The S&P/TSX has almost doubled since the bull market began in U.S. equities began in March 2009.

Linamar rose 12 percent to C$58.89, an all-time high. The company reported first-quarter profit of C$1.23 a share, exceeding analysts’ estimates of C$0.98. The stock is up 132 percent in the last year.

“There’s a scarcity of good-quality stocks in Canada that are growing at a rate like Linamar,” said Decker.

Mitel rose 13 percent to a record C$11.87. The communications equipment provider said it would save an extra $25 million on cost efficiencies from its acquisition of Aastra, according to a statement.

Lundin Mining Corp. gained 1.3 percent to C$5.50, and First Quantum Minerals Ltd. added 1.9 percent to C$20.74. Copper rose 0.9 percent in New York as data showed China’s exports and imports unexpectedly rose in April. The country is the world’s largest consumer of industrial metals.

Avigilon Corp., a maker of surveillance equipment, sank 15 percent to C$20.35 for a third day of losses. The company said earlier this week that Brad Bardua, the chief financial officer, resigned for health reasons. The stock has slumped 23 percent in the past three days.

US
By Joseph Ciolli

May 8 (Bloomberg) — Most U.S. stocks fell, after the Standard & Poor’s 500 Index climbed to within two points of a closing record, as technology shares erased a rally to sell off for a third straight day.

Amazon.com Inc. and E*Trade Financial Corp. slid more than 1.5 percent to pace declines among Internet stocks. Tesla Motors Inc. dropped 11 percent after saying tight battery supplies will continue to restrain growth. Keurig Green Mountain Inc. and 21st Century Fox Inc. added at least 6.5 percent as earnings topped forecasts.

The Standard & Poor’s 500 Index fell 0.1 percent to 1,875.63 at 4 p.m. in New York, after an earlier advance of as much as 0.6 percent. The Dow Jones Industrial Average rose 32.43 points, or 0.2 percent, to 16,550.97, briefly trading above its all-time closing record reached last week. The Nasdaq Composite Index dropped 0.4 percent, reversing an earlier rally of 1 percent. The Russell 2000 Index of small companies slumped 1 percent. About 6.8 billion shares changed hands on U.S. exchanges, in line with the three-month average.

“We continue to see this churning of the market and rotation out of hyper-growth names into value,” Walter Todd, who oversees about $975 million as chief investment officer at Greenwood Capital Associates LLC, said in a phone interview. “You see strength in the morning as people try to see if there’s going to be a breakout, and when that doesn’t occur, you see selling come in the afternoon.”

The Dow Jones Internet Composite Index lost 0.3 percent, erasing an earlier gain of 1.8 percent and adding to a 4.9 percent decline over the previous two days. Technology shares have led this year’s selloff of companies whose growth are more tied to economic swings after a rally drove valuations to about double that of the S&P 500.

The Nasdaq Composite is trading at 34.3 times reported earnings, compared with a multiple of 17.2 for the broad equity measure.

Selloffs in technology shares this week have been led by two of the country’s best-known stocks, Twitter, which has declined 18 percent as insiders were freed to sell stock, and Tesla Motors, which is down 15 percent for the week. An exchange-traded fund of social-media companies fell on eight of the past 12 days amid concern that user growth is slowing and valuations have become excessive.

Tesla plunged 11 percent to $178.59 today, its biggest decline since November. The electric-car maker said research and development costs will rise 30 percent in the second quarter and battery-cell supply will continue to constrain production through the first half before improving in the third quarter.

Amazon dropped for a third day, falling 1.5 percent to $288.32. E*Trade declined 2.1 percent to $21.23 for its third decline in the past four sessions.

Twitter climbed 4.2 percent to $31.96, while Groupon increased 6.1 percent to $5.66 after plunging 21 percent yesterday.

“There’s still some volatility ahead, and I’m still not trusting these tech stocks,” Chris Gaffney, senior market strategist at EverBank Financial in St. Louis, said in a phone interview. “Momentum stocks are still going to face some tough times going forward.”

The S&P 500 climbed yesterday as optimism that the Federal Reserve will continue to support the U.S. economy overshadowed the drop in Internet stocks. Chair Janet Yellen said in testimony to Congress that the central bank must continue to spur economic growth as indicators for inflation and employment remain far from the central bank’s goals.

In response to questions from senators today, Yellen defended the Fed’s accommodative monetary policies and said the central bank had no intention of raising its 2 percent inflation goal.

The Federal Open Market Committee last week pared monthly asset buying to $45 billion, its fourth straight $10 billion cut, and said further reductions in “measured steps” are likely as the economy improves.

Jobless claims fell 26,000 to 319,000 in the week ended May. 3 from a revised 345,000 in the prior period, the Labor Department reported today. The median forecast of 52 economists surveyed by Bloomberg called for a decrease to 325,000.

European Central Bank President Mario Draghi indicated that officials are ready to cut interest rates next month. Officials are debating how much stimulus to give to a euro region economy haunted by the threat of deflation.

While Draghi gave no signal that radical moves such as quantitative easing are imminent, new economic forecasts next month may give them the scope to take interest rates into negative territory.

“It seems the market is making a big bet that the ECB is going to start a QE program pretty soon,” Matt Maley, a Boston- based equity strategist with Miller Tabak & Co., said in a phone interview.

Some 17 S&P 500-listed companies report earnings today. Of the more than 440 companies that have released results this season, 75 percent have beaten estimates for profit, while 53 percent have exceeded projections for revenue, data compiled by Bloomberg show.

The Chicago Board Options Exchange Volatility Index, a gauge for U.S. stock volatility known as the VIX, gained 0.2 percent today to 13.43, reversing an earlier loss of 3.6 percent.

Utility and energy shares fell more than 1.2 percent for the biggest declines among 10 S&P 500 main industries. Transocean Ltd. slid 4.3 percent to $41.47, its biggest decline since February 2013, while Nabors Industries Ltd. fell 3.1 percent to $25.57. Phone companies had the best performance, rallying 1.5 percent.

DirecTV dropped 3.6 percent to $85.11. AT&T Inc., the second-biggest U.S. mobile-phone carrier, is in talks to buy the satellite-television company, people with knowledge of the situation said. AT&T climbed 1.8 percent to $36.40.

Keurig added 13 percent to $104.19. The maker of home- brewing machines expanded its base of North American customers last quarter and sold more drink packs to current users, Chief Executive Officer Brian Kelley said in a statement. Total sales climbed 10 percent to $1.1 billion in the period.

21st Century Fox jumped 6.5 percent to $34.22 after posting third-quarter profit that beat analysts’ estimates after drawing the largest-ever audience to the Super Bowl.

SolarCity Corp. rallied 12 percent to $53.60. The biggest U.S. solar power provider by market value raised its installation forecast for the year after demand for its rooftop systems jumped 78 percent in the first quarter.

 

Have a wonderful evening everyone.

 

Be magnificent!

You are unique as you are here and now.

You are never the same.  You will never be the same again.  You have never before been what you are now.

You will never be it again.

Swami Prajnanpad, 1891-1974

As ever,

 

Carolann

Ever tried.  Ever failed.

No matter.  Try again.

Fail again.  Fail better.

-Samuel Beckett, 1906-1989

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