Author: Carolann

Dear Friends,

Tangents:

The Poem:

Green

The dawn was apple-green,

The sky was green wine held up in the sun,

The moon was a golden petal between.

She opened her eyes, and green

They shone, clear like flowers undone

For the first time, now for the first time seen.

-D.H. Lawrence

On July 11^th, 1914, Babe Ruth  made his major league baseball debut.

On July 11^th, 1960, Harper Lee published To Kill a Mockingbird.  Over fifty million copies have sold to date.

On this date in 1977, Martin Luther King Jr. is posthumously awarded the Presidential Medal of freedom for his leadership during the Civil Rights Movement.

Never believe that a few caring people can’t change the world.  For, indeed, that’s all who ever have.  –Margaret Mead.

Photos of the Day –July 11th, 2013

Milla, a female snow leopard, and her baby are nose to nose in the Zoo de Servion, in Servion, Switzerland. Jean-Christophe Bott/Keystone/AP

Zumreta Ahmetasevic prays amidst gravestones during a funeral ceremony at the memorial center in Potocari, near Srebrenica, Bosnia. People are commemorating the 18th anniversary of a 1995 massacre and reburying recently identified victims exhumed from mass graves. Amel Emric/AP

Market Closes for July 11^th, 2013

Market  Index	Close	Change
Dow  Jones	15461.07	+169.41    +1.11%
S&P 500	1676.29	+23.67      +1.43%
NASDAQ	3578.304	+57.545      +1.63
TSX	12491.95	+185.02
		+1.50%

International Markets

Market  Index	Close	Change
NIKKEI	14472.58	+55.98
		+0.39%
HANG  SENG	21437.49	+532.93
		+2.55%
SENSEX	19676.06	+381.94
		+1.98%
FTSE 100	6543.41	+38.45
		+0.59%

Bonds

Bonds	% Yield	Previous % Yield
CND.  10 Year Bond	2.440	2.508
CND.   30 Year Bond	2.923	2.955
U.S.   10 Year Bond	2.5702	2.6797
U.S.   30 Year Bond	3.6230	3.6861

Currencies

BOC Close	Today	Previous
Canadian $	0.96427	0.95834
US   $	1.03706	1.04347
Euro Rate  1 Euro=		Inverse
Canadian   $	1.35795	0.73640
US  $	1.30909	0.76389

Commodities

Gold	Close	Previous
London Gold   Fix	1285.04	1253.09
Oil	Close	Previous
WTI Crude Future	104.88	105.83
BRENT	108.32	108.47

Market Commentary:

Canada

By Katie Brennan

July 11 (Bloomberg) — Canadian stocks rose the most in 11 months as commodity producers rallied amid speculation central banks will keep acting to stoke economic growth in China and the U.S., the country’s two biggest trading partners.

OceanaGold Corp. and Dundee Precious Metals Inc. surged at least 14 percent as metals prices jumped. Canadian Natural Resources Ltd. added 1.9 percent as energy shares rallied.

BlackBerry Ltd. lost 1.1 percent as two executives left the smartphone maker. Corus Entertainment Inc. slumped 6.9 percent after reporting fiscal third-quarter revenue that fell short of estimates.

The Standard & Poor’s/TSX Composite Index gained 186.33 points, or 1.5 percent, to 12,493.26 at 4 p.m. in Toronto. The gain, the most since August 2012, extended a four-day rally to 3 percent and erased a loss for the year. Trading was in line with the 30-day average at this time of the day.

“The central banks have made it clear that they are going to support the economy,” Barry Schwartz, fund manager with Baskin Financial Services Inc., said from Toronto. He helps manage more than C$500 million ($482 million) with the firm.

“Indirectly, they want to make everybody richer and one way you do it is make the stock market go higher.”

The rally, the S&P/TSX’s longest since May 22, has helped erase a 4.3 percent plunge between June 19 and June 24. That rout started when Federal Reserve Chairman Ben S. Bernanke said after a June 18-19 meeting that the central bank may reduce its $85 billion of monthly bond purchases this year.

Bernanke said after the markets closed yesterday that “highly accommodative monetary policy for the foreseeable future is what’s needed,” and minutes of the Fed’s June meeting showed officials would want to see more signs of job growth before reducing support.

Fed stimulus has helped fuel gains in global stocks and the prospect for less support roiled markets in recent weeks as investors guessed the timing of any reduction. Benchmark U.S indexes closed at records today.

Global equities rallied, with China’s benchmark gauge adding 3.2 percent. The government will soften its stance on monetary policy, Nomura International (HK) Ltd. said, after Premier Li Keqiang said growth must stay above a certain floor.

The nation’s economy slowed for eight of the last nine quarters.

Data in Canada today showed an index of new home prices rose in May. Other reports this week also indicated housing- market strength, as building permits rose a fifth month in May and housing starts fell less than economists predicted in June.

All 10 industries in the S&P/TSX advanced at least 0.3 percent. Raw-materials producers paced the gains, adding 4.6 percent to the highest level since June 19.

Gold producers rallied for a third day, adding 6.9 percent.

The price of the metal for August delivery rose to a two-week high. Dundee Precious Metals led the group with a 16 percent advance, the most since September 2009, to C$4.96. OceanaGold jumped 14 percent to C$1.47.

Fortuna Silver Mines Inc. climbed 7 percent to C$3.54 as silver rallied to the highest level since June 19.

Utility companies added 1.8 percent as a group, led by a 4.1 percent gain in Atlantic Power Corp. The company, which holds indirect interests in power plants in the U.S., closed at C$4.56.

Canadian Natural Resources added 1.9 percent to $33.29 and Niko Resources Ltd. gained 2 percent to C$8.36, driving the S&P/TSX Energy Index to a 1.4 percent increase, its fourth straight gain.

BlackBerry retreated 1.1 percent to C$9.7, the lowest level in eight months, after it said two executives who were closely involved with its new smartphone operating system left the company. The stock dropped 4.9 percent yesterday as the vice president of U.S. sales departed.

Corus Entertainment Inc. slumped 4.9 percent, the most in the index, to C$23.55. The Toronto-based media company reported fiscal third-quarter revenue that fell short of estimates.

US

By Inyoung Hwang and Alex Barinka

July 11 (Bloomberg) — U.S. stocks jumped, sending the Standard & Poor’s 500 Index to a record closing level, as Federal Reserve Chairman Ben S. Bernanke backed sustained monetary stimulus.

All 10 groups in the S&P 500 rallied, with technology and raw-materials shares posting the biggest gains. Freeport-McMoRan Copper & Gold Inc. and Newmont Mining Corp. led gold producers higher as the precious metal’s price soared. Advanced Micro Devices Inc. rose 12 percent as analysts recommended that investors buy the shares. An S&P gauge of homebuilders added 7.1 percent as all 11 members advanced.

The S&P 500 gained 1.4 percent to 1,675.02 at 4 p.m. in New York. The index topped the closing record of 1,669.16 reached May 21, erasing losses since Bernanke first suggested the Fed might curb stimulus this year. The Dow Jones Industrial Average jumped 169.26 points, or 1.1 percent, to 15,460.92 today, also a record. About 6.5 billion shares traded hands on U.S. exchanges today, in line with the three-month average.

“The story in stocks for this year is about confidence replacing uncertainty and anxiety,” Hank Smith, who oversees $7 billion as chief investment officer at Radnor, Pennsylvania- based Haverford Trust Co., said by telephone. “It’s really more about an improvement in sentiment. That’s being a big driver for equity returns and we are still a long ways away from worrying about there being too much optimism or exuberance.”

Central bank stimulus has helped fuel a rally in stocks worldwide, with the benchmark U.S. index surging 148 percent from its March 2009 low. The S&P 500 has advanced for six straight days, the longest winning streak since March 11, and is heading toward its biggest weekly gain since Jan. 4.

Bernanke said yesterday that “highly accommodative monetary policy for the foreseeable future” was needed in the world’s largest economy. The Fed chairman spoke just three hours after the central bank released minutes of the June 18-19 gathering showing that about half of the 19 participants in the Federal Open Market Committee wanted to halt $85 billion in monthly bond purchases by year end.

At the same time, the minutes showed many Fed officials wanted to see more signs employment is improving before backing a trim to bond purchases known as quantitative easing.

“Everybody’s hanging on the Fed’s every word,” Malcolm Polley, who manages $1.1 billion as chief investment officer at Stewart Capital Advisors LLC in Indiana, Pennsylvania, said by telephone. “Even though Bernanke’s comments after the last FOMC meeting really weren’t hawkish, the market has wanted more clarity in terms of what he meant. Bernanke was as clear as one can be, saying ‘We’re not going to step on the brakes. We’re just going to let up on the accelerator.’ The more dovish comments he made yesterday clarifies that position.”

The S&P 500 sank as much as 5.8 percent after reaching a record on May 21, the day before Bernanke said the central bank may start paring stimulus efforts as soon as September if the economy improves in line with its forecasts. The equity gauge has rebounded 6.5 percent from a June 24 bottom as economic data from hiring to housing tempered concern over the possible scaling back of Fed stimulus.

Data today showed the number of Americans filing for unemployment benefits unexpectedly increased to a two-month high. Swings in jobless applications are typical in July as auto plants close for annual retooling. The Labor Department last week released its jobs report for the month of June, showing the economy added 195,000 jobs, exceeding estimates, while the unemployment rate was unchanged at 7.6 percent.

“Fed policy has been helpful no question, but the driver of equity returns off of the March 2009 bottom has been fundamentals, not Fed policy,” Haverford’s Smith said. “You’ve had over the past four years tremendous earnings growth confirmed by dividend growth. That has been the primary driver of the market but yet Fed policy has been helpful.”

Investors are watching earnings results this week. Profit at companies listed on the S&P 500 rose 1.8 percent last quarter, down from a projection of 8.7 percent six months ago, according to analyst estimates compiled by Bloomberg. Lower expectations helped about 73 percent of the companies in the benchmark measure exceed forecasts by an average of 5.1 percent for the first three months of the year, Bloomberg data show.

The Chicago Board Options Exchange Volatility Index, or VIX, slid 1.4 percent to 14.01, the lowest level since May 24.

The equity volatility gauge, which moves in the opposite direction as the S&P 500 about 80 percent of the time, has declined six straight days, the longest streak of losses since January. The index reached a six-month high on June 20 and has fallen 32 percent since.

Technology, raw-material and utility companies rallied more than 1.6 percent for the biggest gains out of 10 S&P 500 groups.

Investors bought shares of stocks most tied to economic growth, sending the Morgan Stanley Cyclical Index up 1.8 percent to a record close.

The Nasdaq Composite Index rose 1.6 percent to 3,578.30, the highest since September 2000, as technology shares soared 1.7 percent as a group. Intel Corp. climbed 3.2 percent to $23.99 and Microsoft Corp. rallied 2.8 percent to $35.69, the highest since 2007. The two stocks had the best performance in the Dow today.

Hewlett-Packard Co. increased 1.7 percent to $26.38 after a report showed its sales of personal computers in the U.S. fell less than 1 percent in the second quarter. Sales for all PC makers gained 8.5 percent from the previous quarter and posted their smallest year-on-year drop of the last seven quarters, according to market researcher Gartner Inc.

AMD added 12 percent to $4.45 for the largest advance in the S&P 500. Bank of America’s Merrill Lynch unit and Canaccord Genuity Ltd. raised their ratings on the maker of processors for personal computers to buy from underperform, and to buy from hold, respectively. Canaccord said increased production of games consoles may boost demand for its hardware in the third quarter.

Freeport advanced 4.6 percent to $28.53. Gold futures rallied 2.6 percent for a fourth day of gains. Newmont Mining added 5.7 percent to $28.12 after reaffirming its forecast for gold and copper production this year in a statement late yesterday.

The S&P Supercomposite Homebuilding Index rallied 7.1 percent for the biggest gain since October 2011. D.R. Horton Inc. surged 9.2 percent to $22.98 and Lennar Corp. jumped 8.3 percent to $37.44.

Celgene Corp. rose 7.9 percent to a record $134.92 after its Revlimid cancer drug met the goal of a study aimed at showing the medicine could be an initial treatment for patients with multiple myeloma.

Bank shares were the only group to fall among 24 S&P 500 industries, losing 0.6 percent as regional banks tumbled.

Regions Financial Corp. slid 2.5 percent to $9.88 and KeyCorp tumbled 1.9 percent to $11.57. The KBW Regional Banking Index erased 1.5 percent as 48 out of 50 members declined.

JPMorgan Chase & Co. increased 0.6 percent to $55.14 while Wells Fargo & Co. slipped 0.4 percent to $41.89. The two lenders report second-quarter results tomorrow, the first of the six largest U.S. banks.

Bernanke’s plan for paring central bank bond purchases are estimated to squeeze profit and erode capital through 2014 at the six largest U.S. lenders, overshadowing second-quarter earnings that are projected to rise by an average of 20 percent.

Market gyrations that began mid-quarter damped earnings at firms including Goldman Sachs Group Inc. and Bank of America Corp., analysts’ estimates show. Trading and home-lending that started strong slumped after Bernanke indicated May 22 that the Fed could slow monthly bond purchases.

Have a wonderful evening everyone.

Be magnificent!

Free yourself from anger and desire, which are the causes of sin and conflict,

and thereby make yourself whole.  This is the essence of yoga;

this is the means by which you come to know the soul, and thereby attain the highest spiritual state.

Learn to meditate.  Close your eyes; calm your breathing; and focus your attention

on the center of consciousness.  Thus you will master the senses, the emotions, and the intellect –

and thereby free yourself from desire and anger.

The Bhagavad Gita

As ever,

Carolann

 

Humility is attentive patience.

-Simone Weil, 1909-1943

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

 

Tel: 778.430.5808

(C): 250.881.0801

Toll Free: 1.877.430.5895

Fax: 778.430.5828

www.carolannsteinhoff.com

 

 

 

Dear Friends,

Tangents:

Tired of people talking loudly on cellphones or jangly, obnoxious ring tones?  So were the staff at the website The Art of Manliness, so they asked artist Ted Slampyak to create 1940-s era propaganda posters urging phone users to be more polite.  Check them out at http://bit.ly/politephones.  I was pleased to find that when we recently took an Amtrak train from Penn Station to Philadelphia, passengers had the choice of a “quiet” train (no cell phones or loud talking) or a regular train.

Music: The Waterboys have created an entire album from the poems of W.B. Yeats.  An Appointment with Mr. Yeats finds the Celtic rock band returning to the 1980s sound they dubbed “the big music.”  Critics say it is The Waterboys’ best record since “Fisherman’s Blues.”

Poem:

BEGINNING

In the beginning,

in the list of begats,

one begat

got forgot:

work begets work

(one poem

bears

the next).

In other words,

once there was air,

a bird

could be got.

Not taken.

Not kept.

But conjured up.

-Lia Purpura

Film: Gary and I went to see the movie Before Midnight last night.  Great film.  Great acting. Highly recommended.

Photos of the Day –July 10th, 2013

Omega Pharma-Quick Step team rider Sylvain Chavanel of France cycles past Mont Saint-Michel during the 32 km individual time trial eleventh stage of the centenary Tour de France. Eric Gaillard/Reuters

A postman delivers letters to a house in Henton, southern England. The British government plans to privatize the state postal operator. Eddie Keogh/Reuters

Market Closes for July 10^th, 2013

Market  Index	Close	Change
Dow  Jones	15291.66	-8.68    -0.06%
S&P 500	1652.62	+0.30      +0.02%
NASDAQ	3520.759	+16.496      +0.47
TSX	12306.93	+9.84
		+0.08%

International Markets

Market  Index	Close	Change
NIKKEI	14416.60	-56.30
		-0.39%
HANG  SENG	20904.56	+221.55
		+1.07%
SENSEX	19294.12	-145.36
		-0.75%
FTSE 100	6504.96	-8.12
		-0.12%

Bonds

Bonds	% Yield	Previous % Yield
CND.  10 Year Bond	2.508	2.474
CND.   30 Year Bond	2.955	2.930
U.S.   10 Year Bond	2.6797	2.6340
U.S.   30 Year Bond	3.6861	3.6477

Currencies

BOC Close	Today	Previous
Canadian $	0.95834	0.94955
US   $	1.04347	1.05313
Euro Rate  1 Euro=		Inverse
Canadian   $	1.35811	0.73632
US  $	1.30153	0.76833

Commodities

Gold	Close	Previous
London Gold   Fix	1253.09	1251.50
Oil	Close	Previous
WTI Crude Future	105.83	103.53
BRENT	108.47	108.71

Market Commentary:

Canada

By Eric Lam

July 10 (Bloomberg) — Canadian stocks rose a third day, erasing earlier losses as oil rallied and investors analyzed U.S. Federal Reserve minutes for signs on when the central bank might slow the pace of stimulus.

BlackPearl Resources Inc. surged 15 percent as crude jumped to a 15-month high. Alimentation Couche-Tard Inc. climbed 6.3 percent to lead gains among producers of consumer staples, rebounding from its biggest decline in year after reporting earnings yesterday. BlackBerry Ltd. dropped to an eight-month low after announcing late yesterday its vice president of U.S. sales had left.

The Standard & Poor’s/TSX Composite Index rose 9.84 points, or 0.1 percent, to 12,306.93 at 4 p.m. in Toronto, erasing an earlier decline of as much as 0.4 percent. The index has lost 1 percent this year.

“The market got carried away and misinterpreted what Bernanke said at his press conference, and the losses were a little overdone,” said David Baskin, president of Baskin Financial Services in Toronto. The firm manages C$500 million ($476 million). “Basically people today are saying ’No big deal’ to this.”

Canadian equities plunged 4.3 percent between June 19 and June 24, tracking a similar drop among U.S. stocks, as Fed Chairman Ben S. Bernanke said after the June 18-19 meeting that the central bank may reduce the pace of monthly bond purchases as soon as in September.

Fed stimulus has helped fuel gains in global stocks and the prospect for less support roiled markets in recent weeks as investors guessed the timing of any reduction. The minutes, released at 2 p.m. today in Washington, showed that while several members judged that a reduction in asset purchases “would likely soon be warranted,” many officials want to see more signs employment is picking up before they’ll taper stimulus.

The meeting occurred before data last week showed U.S. hiring last month exceeded expectations while the unemployment rate remained unchanged at 7.6 percent. With today’s gain, the S&P/TSX has recovered much of its loss after the meeting, closing 0.5 percent below its June 18 level.

Separate data showed China’s imports and exports declined in June, raising concerns that Canada’s second-largest trading partner faces slowing economic growth. Overseas shipments slid 3.1 percent from a year earlier, compared with the median estimate of a 3.7 percent gain.

“It’s the latest in a long line of softening economic data from China,” said John Wilson, co-chief investment officer with Sprott Asset Management LP in Toronto. He manages about C$250 million across three funds. “That exports were negative was a bit of a surprise. It’s consistent with the idea that growth in China is slowing.”

Shares in raw-materials producers retreated 0.2 percent, even as commodities extended a rally to a seventh day. Consumer staples stocks gained the most in the benchmark gauge, rising 1.4 percent as a group as four of 10 industries in the S&P/TSX advanced. Trading volume was 18 percent lower than the 30-day average.

Couche-Tard, the largest public convenience-store operator in North America, rallied 6.3 percent to C$62. The stock recovered losses from yesterday when the company reported fourth-quarter earnings that fell short of analysts’ estimates.

Energy shares jumped 0.4 percent as crude in New York surged to its highest since March 2012, with gains accelerating after the Fed minutes were released. BlackPearl Resources soared 15 percent to C$1.75, the biggest advance since August 2011.

Gold producers gained, as the price of the precious metal climbed to a one-week high. Alacer Gold Corp. rallied 3.4 percent to C$2.43 and Torex Gold Resources Inc. jumped 8.2 percent to C$1.32.

Fortis Inc., which invests in electricity distribution, slipped 1.1 percent to C$32.05, dragging utilities stocks to the worst performance in the benchmark gauge. The S&P/TSX Utilities Index retreated 0.9 percent, with nine of 11 members lower.

Technology shares dropped 0.1 percent for the eighth decline in the past nine sessions, led lower by BlackBerry. The smartphone maker, formerly Research In Motion Ltd., sank 3.9 percent to C$9.80, the lowest since November. The Waterloo, Ontario-based company said in an e-mail yesterday that Richard Piasentin, vice-president of U.S. sales, has left the company.

The stock has plunged 35 percent since June 27, the day before BlackBerry posted worse-than-expected earnings in its most recent quarter. The company said at its shareholder meeting yesterday that it’s looking for partners to help get its software on more devices as sales of its phones struggle.

US

By Inyoung Hwang and Alex Barinka

July 10 (Bloomberg) — U.S. stocks were little changed as investors analyzed minutes from the Federal Reserve’s last meeting for signs on when the central bank might slow the pace of stimulus efforts.

Financial companies fell the most out of 10 S&P 500 groups as Bank of America Corp. and Wells Fargo & Co. slumped more than 1.2 percent. Nabors Industries Ltd. fell 6.3 percent after forecasting operating income below analysts’ estimates. Family Dollar Stores Inc. added 7.1 percent as the retailer’s earnings topped analyst estimates. Hewlett-Packard Co. rose 1.8 percent after Citigroup Inc. advised investors to buy the stock.

The Standard & Poor’s 500 Index added less than 0.1 percent to 1,652.62 at 4 p.m. in New York, after rising and falling as much as 0.3 percent during the day. The Dow Jones Industrial Average dropped 8.68 points, or 0.1 percent, to 15,291.66. About 5.7 billion shares traded hands on U.S. exchanges, or 13 percent below the three-month average.

“The minutes largely reiterated what the chairman said in June,” Ryan Larson, the Chicago-based head of U.S. equity trading at RBC Global Asset Management (U.S.) Inc., said by e- mail. His firm oversees $290 billion. “Tapering, whether it will be this year or next, is inevitable. The market was initially encouraged that the Fed is waiting on additional data, but possibly taken aback by the fact that about half the participants indicated that asset purchases should end later this year.”

Minutes from the central bank’s June 18-19 meeting, released today in Washington, showed that while several members judged that a reduction in asset purchases “would likely soon be warranted,” many officials want to see more signs employment is picking up before they’ll begin slowing the pace of $85 billion in monthly bond purchases.

Fed officials met before last week’s Labor Department jobs report for the month of June exceeded expectations, with the economy adding 195,000 jobs and the unemployment rate unchanged at 7.6 percent.

The S&P 500 rallied 2.4 percent over the past four days as the June employment data eased concern over a scaling back of Fed stimulus. The index has recovered from a 4.8 percent drop between June 19 and 24, triggered when Fed Chairman Ben S.

Bernanke said the central bank may reduce its bond-buying this year and end the program in 2014 as economic risks subside. The benchmark gauge is up 16 percent for the year, and within 1 percent of a record high set on May 21.

Data today showed inventories at U.S. wholesalers unexpectedly declined in May by the most since September 2011 as sales surged, pointing to a pickup in orders and production.

In China, a report from the General Administration of Customs in Beijing showed that exports fell 3.1 percent in June from a year earlier. The median estimate in a Bloomberg survey had called for a 3.7 percent gain. Imports dropped 0.7 percent last month, compared with the median projection of a 6 percent increase. China’s trade surplus with the U.S. slipped to $17.49 billion in June from $19.35 billion in May.

Investors have also been watching corporate earnings. Alcoa Inc. unofficially started the U.S. earnings season on July 8 with results that beat analysts’ estimates. JPMorgan Chase & Co. and Wells Fargo are among companies releasing results later this week.

The Chicago Board Options Exchange Volatility Index, or VIX, slid 1 percent to 14.21. The equity volatility gauge, which moves in the opposite direction as the S&P 500 about 80 percent of the time, reached a six-month high on June 20 and has fallen 31 percent since.

Financial companies lost 0.6 percent. U.S. regulators proposed a plan yesterday that said the eight largest firms would need to retain capital equal to at least 5 percent of assets, while their banking units would have to hold a minimum of 6 percent. Bank of America dropped 1.2 percent to $13.37.

Wells Fargo sank 1.5 percent to $42.07. Nabors Industries fell 6.3 percent to $14.99 after the company said it expects second-quarter operating income of $88 million to $91 million, below estimates of $110.1 million. The owner and operator of land drilling rigs cited adverse weather and intense competition, particularly for pressure pumping in the U.S. and Canada.

Best Buy Co. plunged 4.2 percent to $28.47. Cleveland Research Co. wrote in a report that a seasonal slowdown during the May to June period appears more pronounced this year for the world’s largest consumer-electronics retailer.

Fastenal Co. slid 2.8 percent to $45.77 after the seller of industrial and construction supplies reported second-quarter sales of $847.6 million, lower than analyst estimates for $857.4 million. Hewlett-Packard

 

Health-care, utility and technology shares rose the most among 10 S&P 500 groups, climbing at least 0.5 percent.

Hewlett-Packard increased 1.8 percent, the most in the Dow, to $25.93. Citigroup upgraded its recommendation for the computer maker to buy from sell and doubled its price estimate for the shares to $32. A survey among chief information officers signaled a “positive inflection” for HP’s services, Citigroup analysts said.

Cisco Systems Inc. gained 1 percent to $25.41, the highest level since May 2010, after surging 2.2 percent yesterday.

Microsoft Corp. advanced 1 percent to $34.70.

Family Dollar Stores jumped 7.1 percent to $68.50. The second-biggest U.S. dollar-store retailer reported fiscal third- quarter earnings of $1.05 a share, beating analyst estimates of $1.03 a share. Same-store sales climbed 2.9 percent as average transaction value and customer traffic increased for the quarter ended June 1.

Dollar General Corp. increased 5.8 percent to $54.78.

Dollar Tree Inc. added 2.8 percent to $54.29.

 

Have a wonderful evening everyone.

Be magnificent!

 

We are always comparing what we are with what we should be.

This measuring ourselves all the time against something or someone

is one of the primary causes of conflict.  Now why is there any comparison at all?

If you do not compare yourself with another

you will be what you really are.

Krishnamurti, 1895-1986

As ever,

Carolann

 

Endurance is patience concentrated.

-Thomas Carlyle, 1795-1881

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

 

Tel: 778.430.5808

(C): 250.881.0801

Toll Free: 1.877.430.5895

Fax: 778.430.5828

www.carolannsteinhoff.com

 

 

 

Dear Friends,

Tangents:

SUMMER

Heavy July.  Too rampant and too lush;

High Summer, dull, fulfilled, and satiate,

Nothing to fear, and little to await.

The very birds are hush.

Dark over-burdened woods: too black, their green.

No leaping promise, no surprise, no keen

Difficult fight against a young, a lean

Sharp air and frozen soil; no contest bright

Of fragile courage winning in despite.

Easy July, when all too warmly blows

The surfeit of the rose

Risking no harm;

And those aggressive indestructible

Bores, the herbaceous plants, that gladly take

Whatever’s given and make no demand

Beyond the careless favour of a stake;

Humble appeal, not arrogant command,

Like some tough spinster, doughty, duteous,

All virtue and no charm…

-from The Garden, V. Sackville-West

On July 9^th, 1962, Bob Dylan recorded Blowin’ In the Wind.

Photos of the Day –July 9th, 2013

Members of the media film a 39,000-year-old female Woolly mammoth, which was found frozen in Siberia, Russia, upon its arrival at an exhibition hall in Yokohama, Japan. Toru Hanai/Reuters

Workers attach photos by Kai Wiedenhoefer to the backside of the East Side Gallery in Berlin. Eight of his photographs of borders and separation walls will be exhibited here until Sept. 13. Paul Zinken/dpa/AP

Market Closes for July 9^th, 2013

Market  Index	Close	Change
Dow  Jones	15300.34	+75.65    +0.50%
S&P 500	1652.32	+11.86      +0.72%
NASDAQ	3504.263	+19.432      +0.56
TSX	12297.09	+88.22
		+0.72%

International Markets

Market  Index	Close	Change
NIKKEI	14472.90	+363.56
		+2.58%
HANG  SENG	20683.01	+100.82
		+0.49%
SENSEX	19439.48	+114.71
		+0.59%
FTSE 100	6513.08	+63.01
		+0.98%

Bonds

Bonds	% Yield	Previous % Yield
CND.  10 Year Bond	2.474	2.477
CND.   30 Year Bond	2.930	2.923
U.S.   10 Year Bond	2.6340	2.6356
U.S.   30 Year Bond	3.6477	3.6334

Currencies

BOC Close	Today	Previous
Canadian $	0.94955	0.94712
US   $	1.05313	1.05587
Euro Rate  1 Euro=		Inverse
Canadian   $	1.34608	0.74290
US  $	1.27817	0.77709

Commodities

Gold	Close	Previous
London Gold   Fix	1251.50	1237.21
Oil	Close	Previous
WTI Crude Future	103.53	103.14
BRENT	108.71	107.54

Market Commentary:

Canada

By Eric Lam

July 9 (Bloomberg) — Canadian stocks rose, sending the benchmark index to the highest level in three weeks, as an advance in precious metals prices overshadowed disappointing earnings from companies including Alimentation Couche-Tard Inc.

OceanaGold Corp. and Argonaut Gold Inc. rallied at least 7.1 percent as gold climbed. Alimentation Couche-Tard, which operates convenience stores across North America and Europe, slumped 5 percent after adjusted earnings fell short of forecasts due in part to higher expenses in Europe. Jean Coutu Group Inc., the pharmacy company, fell 2.1 percent after posting first-quarter revenue short of estimates.

The Standard & Poor’s/TSX Composite Index rose 88.22 points, or 0.7 percent, to 12,297.09 at 4 p.m. in Toronto. The gauge has rallied 3.9 percent since hitting its low for the year on June 24. Trading volume was 18 percent below the 30-day average at this time of the day.

“We’re seeing some buying in the gold sector, likely because the entire sector was so oversold,” said Arthur Salzer, chief executive officer of Northland Wealth Management in Toronto. The firm manages C$225 million ($213 million). “There was so much optimism in Couche-Tard and Jean Coutu, that once in a while the stocks get ahead of themselves. The underlying numbers were quite good but maybe not what people were hoping for.”

The International Monetary Fund cut its projection for global growth in 2013 for a fifth time, to 3.1 percent from 3.3 percent in April as a U.S. expansion weakens, China’s economy levels off and Europe’s recession deepens. U.S. growth was trimmed to 1.7 percent from 1.9 percent, while China’s was lowered to 7.8 percent from 8 percent.

Raw-materials stocks paced gains in the S&P/TSX, rising 1.7 percent as a group. OceanaGold jumped 8.5 percent to C$1.28 and Argonaut Gold gained 7.1 percent to C$5.58 as gold futures for August delivery advanced 0.9 percent to $1,245.90 an ounce in New York. The S&P/TSX Gold Index climbed 1.1 percent as 18 of 25 members advanced.

First Majestic Silver Corp. rallied 4.7 percent to C$11.70 and Pan American Silver Corp. rose 3.2 percent to C$12.13 as silver prices gained.

BlackBerry Ltd., maker of the BlackBerry 10 line of smartphones, added 1 percent to C$10.20 after investors re- elected the company’s existing directors at an annual general meeting today and approved the company’s name change from Research In Motion Ltd.

Chief Executive Officer Thorsten Heins said at the meeting the company is “100 percent open to partnerships” to drive scale and will explore “every opportunity” to create value.

Consumer-staples companies, which include both Jean Coutu and Couche-Tard, lost the most in the S&P/TSX, declining 0.9 percent as a group.

Couche-Tard, the largest publicly traded convenience store chain operator in North America, sank 5 percent to C$58.35, for its biggest decline since May 2012. The Laval, Quebec-based company said fourth-quarter adjusted earnings were 61 cents a share, while analysts surveyed by Bloomberg had estimated 78 cents. Merchandise and service gross margins in the U.S., where Couche-Tard operates the Circle K convenience-store chain, declined 0.1 percent in the quarter.

Jean Coutu lost 2.1 percent to C$17.44. The Longueuil, Quebec-based company reported first-quarter revenue of C$681.6 million, falling short of forecasts for C$688.2 million.

Adjusted earnings for the period were 26 Canadian cents a share, in line with analysts’ estimates.

US

By Alex Barinka and Inyoung Hwang

July 9 (Bloomberg) — U.S. stocks rose for a fourth day amid optimism companies will report better-than-forecast earnings and that economic growth is strong enough to withstand any reduction in Federal Reserve stimulus.

Nine out of 10 groups in the S&P 500 advanced. FedEx Corp. rallied 4.4 percent, to lead industrial shares higher. An S&P gauge of homebuilders added 5.5 percent as all 11 members advanced. Kroger Co. climbed 2.7 percent after saying it will buy Harris Teeter Supermarkets Inc. in a deal valued at $2.5 billion. Alcoa Inc. slipped even after posting earnings that beat analysts’ estimates and maintaining its forecast for global aluminum demand.

The Standard & Poor’s 500 climbed 0.7 percent to 1,652.32 in New York, the highest in almost six weeks. The Dow Jones Industrial Average rose 75.65 points, or 0.5 percent, to 15,300.34 today. More than 5.8 billion shares traded hands on U.S. exchanges today, or 8.1 percent below the three-month average.

“Everybody’s waiting to see what earnings are going to look like,” Brian Jacobsen, who helps oversee $221.2 billion as chief portfolio strategist at Wells Fargo Advantage Funds in Menomonee Falls, Wisconsin, said by telephone. “Until we see more earnings roll in, we’re waiting until tomorrow for what the Fed says. A lot of the other things are preludes or noise.”

The S&P 500 has gained 2.4 percent in the last four days, its longest winning streak since May 15, as better-than- estimated economic data on employment and manufacturing tempered concern over a scaling back of Fed bond buying. Investors will gain more insight into the central bank’s plans tomorrow when Chairman Ben Bernanke speaks and the Federal Open Market Committee publishes minutes from its June meeting.

The benchmark gauge plunged as much as 5.8 percent from a record high on May 21, when Bernanke first suggested the Fed might curb stimulus this year if growth meets the central bank’s estimates. The S&P 500 has since risen 5 percent from its June low and is 1 percent off the record. The index today surpassed its level on June 18, the day before a 4.8 percent rout started as the Fed’s policy-making committee suggested tapering could occur as early as in September.

The International Monetary Fund today lowered its 2013 projection for U.S. growth to 1.7 percent from 1.9 percent in April. The IMF said global growth will struggle to accelerate as U.S. expansion weakens, China’s economy levels off and Europe’s recession deepens.

The Fed stimulus and better-than-estimated corporate earnings have helped fuel a rally that lifted the S&P 500 by as much as 147 percent from its bear-market low in 2009. The start of the earnings season, which is traditionally marked by Alcoa’s report, has been a buying opportunity during that time. The S&P 500 has risen 13 of the 17 times Alcoa has posted results in the bull market, adding an average 1.6 percent in the two weeks following the company’s release.

Earnings at companies listed on the S&P 500 rose 1.8 percent last quarter, down from a projection of 8.3 percent six months ago, according to more than 11,000 analyst estimates compiled by Bloomberg. Lower expectations helped about 73 percent of the companies in the benchmark measure exceed forecasts by an average of 5.1 percent for the first three months of the year, Bloomberg data show. There are no S&P 500 companies scheduled to report today.

“Expectations for second-quarter earnings had fallen quite a bit and we’re beginning to see that the downgrades were by too much,” Jacobsen said. “We could see some pleasant surprises in the earnings season.”

Alcoa, the first member of the Dow to release results, slumped 0.1 percent to $7.91. The largest U.S. aluminum producer said profit excluding one-time items was 7 cents a share, more than the 6-cent average of 15 estimates compiled by Bloomberg.

Sales fell to $5.85 billion, also exceeding the $5.79 billion average of nine estimates.

Alcoa maintained its forecast that global aluminum demand will rise by 7 percent this year, led by 11 percent growth in China. Demand will exceed supply by 315,000 tons, the company said in presentation slides for the conference call.

The Chicago Board Options Exchange Volatility Index, or VIX, slid 2.9 percent to 14.35. The equity volatility gauge, which moves in the opposite direction as the S&P 500 about 80 percent of the time, reached a six-month high on June 20 and has fallen 30 percent since.

Industrial stocks rose 1.5 percent for the second-biggest gain among 10 S&P 500 groups behind materials producers.

Caterpillar Inc. surged 2.6 percent to $85.33 for the largest increase in the Dow.

FedEx jumped 4.4 percent to $103.15 amid speculation that it may be an investment target for William Ackman’s Pershing Square Capital Management LP. The company also agreed to settle a lawsuit claiming it had been “systematically overcharging” customers by billing businesses and government offices at higher residential rates. United Parcel Service Inc. added 1.6 percent to $89.73.

The S&P Supercomposite Homebuilding Index rallied 5.5 percent, rebounding after falling yesterday to a low for the year. D.R. Horton Inc. surged 7.6 percent to $21.22, the biggest gain since April. KB Home climbed 6.7 percent to $18.86.

Cisco Systems Inc. jumped 2.2 percent to $25.16 after announcing a deal with Microsoft Corp. on cloud computing infrastructure.

Tesla Motors Inc. advanced 1.5 percent to $123.45. Nasdaq OMX Group Inc. said the maker of electric cars will join the Nasdaq-100, which tracks the biggest companies on the Nasdaq, before the start of trading on July 15. The best-performing automotive stock this year will replace Oracle Corp., which is moving to the New York Stock Exchange.

Barnes & Noble Inc., which is considering separating and spinning off its divisions, jumped 5.4 percent to $18.61. The U.S. bookstore chain said Chief Executive Officer William Lynch resigned. The company promoted Chief Financial Officer Michael Huseby to president of the company and CEO of Nook Media, making him Barnes & Noble’s most senior executive.

International Business Machines Corp. dropped 1.9 percent to $191.30 for the biggest retreat in the Dow. Goldman Sachs Group Inc. downgraded the largest technology-services provider to a neutral rating from buy. The firm expects growing pressure on IBM’s growth areas in emerging markets. Goldman cut the price target for the stock to to $200 from $220.

Kroger, the largest U.S. grocery chain, climbed 2.7 percent to $37.15 after saying it will buy Harris Teeter in a deal valued at $2.5 billion. The smaller regional chain added 1.5 percent to $49.26.

Intuitive Surgical Inc. plunged 16 percent, the most in almost five years, to $419.30 after reporting preliminary results that missed analysts’ estimates as sales slowed for its surgical robots.

Have a wonderful evening everyone.

Be magnificent!

As long as the brain, which is so heavily conditioned, is measuring, “the more,” “the better,”

moving psychologically from this to that, it must inevitably bring about a sense of conflict, and this is disorder.

Not only the words more and better, but the feeling, the reaction, of achieving,

gaining – as long as there is this division, duality, there must be conflict.  And out of conflict is disorder.

Krishnamurti,1895-1986

As ever,

Carolann

 

Genius is eternal patience.

-Michelangelo, 1475-1564

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

 

Tel: 778.430.5808

(C): 250.881.0801

Toll Free: 1.877.430.5895

Fax: 778.430.5828

www.carolannsteinhoff.com

 

 

 

Dear Friends,

Tangents:

I was reading a back issue of The Economist on the weekend and came across the obituary for Nguyen Chi Thien, the Vietnamese poet who died last year at age 73.  What an amazing story of courage and resolve was his life.  Nguyen Chi Thien sent his poems out of Communist Vietnam by running through the gate of the British embassy in Hanoi in 1979 with 400 of his poems under his shirt.  They were published as “Flowers of Hell”, translated into half a dozen languages and won the International Poetry Award in 1985.  He spent many years in prison and labour camps on various pretexts, contesting the regime’s view of history and writing ”irreverent” poetry for example.  It seemed the more the regime hurt him, the more he thrived.

Here is a sample of his poetry:

They exiled me to the heart of the jungle

Wishing to fertilise the manioc with my remains.

I turned into an expert hunter

And came out full of snake wisdom and rhino fierceness.

They sank me into the ocean

Wishing me to remain in the depths.

I became a deep sea diver

And came up covered with

scintillating pearls.

The pearls were his poems.  “If people could see his heart, he had written back in 1964, during his first spell in prison, they would see it was an ancient pen and inkstand, gathering dust; on a poor roadside inn, offering only the comfort of an oil lamp.  But it was also a paddy field waiting for the flood-rains of August,

So that it can overflow into a

thousand waves,

White-crested ones that will sweep

everything away!”

Photos of the Day –July 8th, 2013

A woman dressed in traditional costume smiles as she attends the gala show of the Latvian Nationwide Song and Dance Celebration in Riga. About 12,000 singers and 15,000 dancers from all over the country are participating. Ints Kalnins/Reuters

A swimmer approaches a statue meant to depict actor Colin Firth performing as Mr. Darcy, a character in Jane Austen’s novel ‘Pride and Prejudice,’ in Serpentine Lake, Hyde Park, London. David Parry/PA/AP

Market Closes for July 8^th, 2013

Market  Index	Close	Change
Dow  Jones	15224.69	+88.85    +0.59%
S&P 500	1640.46	+8.57      +0.53%
NASDAQ	3484.831	+5.451      +0.16
TSX	12208.87	+73.96
		+0.61%

International Markets

Market  Index	Close	Change
NIKKEI	14109.34	-200.63
		-1.40%
HANG  SENG	20582.19	-272.48
		-1.31%
SENSEX	19324.77	-171.05
		-0.88%
FTSE 100	6450.07	+74.55
		+1.17%

Bonds

Bonds	% Yield	Previous % Yield
CND.  10 Year Bond	2.477	2.550
CND.   30 Year Bond	2.923	2.973
U.S.   10 Year Bond	2.6356	2.7391
U.S.   30 Year Bond	3.6334	3.7130

Currencies

BOC Close	Today	Previous
Canadian $	0.94712	0.94520
US   $	1.05587	1.05797
Euro Rate  1 Euro=		Inverse
Canadian   $	1.35875	0.73597
US  $	1.28686	0.77709

Commodities

Gold	Close	Previous
London Gold   Fix	1237.21	1223.20
Oil	Close	Previous
WTI Crude Future	103.14	1.0322
BRENT	107.54	108.10

Market Commentary:

Canada

By Katie Brennan

July 8 (Bloomberg) — Canadian stocks rose, following last week’s gain, led by advances among utility companies and energy providers as investors looked to Alcoa Inc. for the the first major report of the second-quarter earnings season in the U.S.

Just Energy Group Inc. rose 4.9 percent, pacing gains among utility companies. Health-care companies gained 1.7 percent, led by a 3.1 percent advance in Catamaran Corp., a pharmacy services provider. Turquoise Hill Resources Ltd. added 7.5 percent after its copper mine in Mongolia was cleared to ship to China.

Lightstream Resources Ltd. surged 6.6 percent.

The Standard & Poor’s/TSX Composite Index gained 73.96 points, or 0.6 percent, to 12,208.87 at 4 p.m. in Toronto. The gauge rose 0.1 percent last week and is down 1.8 percent for the year. Trading volume was 6.8 percent lower than the 30-day average.

“Investors are getting ready for the earnings season,”

John Kinsey, a fund manager with Caldwell Securities Ltd. in Toronto, said in a phone interview. He helps manage about C$1 billion ($953 million). “It is nice to see the commodities and the stocks are up today. Gold is trying very hard to put a bottom in here. We are hoping it will do so and then maybe try and climb back up again.”

Alcoa reported second-quarter earnings after the market close that beat analysts’ estimates as U.S. carmakers used more of the lightweight metal in their latest models. The largest U.S. aluminum producer, the first Dow Jones Industrial Index member to release results for the quarter, had its credit rating cut to junk by Moody’s Investors Service in May.

Earnings at companies listed on the S&P 500 rose 1.8 percent last quarter, down from a projection of 8.7 percent six months ago, according to more than 11,000 analyst estimates compiled by Bloomberg. Lower expectations helped about 73 percent of the companies in the benchmark measure exceed forecasts by an average of 5.1 percent for the first three months of the year, Bloomberg data show.

Canadian building permits rose a fifth straight month in May, a surprise gain that caps the longest stretch in almost a decade, led by a jump in multiple-unit housing work in Toronto that has sparked warnings from policy makers about overbuilding.

Canadian business optimism about sales and investment faded in the second quarter on signs of sluggish domestic and global demand, a central bank survey showed.

The balance of opinion for sales growth over the next 12 months fell to 9 percentage points from 24 percentage points in the Bank of Canada’s survey of about 100 executives. Investment intentions declined to a balance of 9 from 12, the Bank of Canada said today.

Seven of 10 groups in the S&P/TSX advanced, led by a 2.8 percent gain in utilities companies. Just Energy Group added 4.9 percent to C$6.45 and ATCO Ltd. rose 4.3 percent to C$44.21.

Health-care companies rose 1.7 percent as Catamaran gained 3.1 percent to C$51.56 and Valeant Pharmaceuticals International Inc. added 1.5 percent to C$95.14.

Lightstream Resources, an oil production company, gained 6 percent to C$8.16, leading gains for energy companies. The group added 1.1 percent.

Raw-materials producers fell 0.1 percent as a group.  Metal prices rose, with gold gaining the most in a week and silver and copper adding at least 1.1 percent. Bullion has slipped 26 percent this year after some investors lost faith in the metal as a store of value as Federal Reserve Chairman Ben S. Bernanke said the U.S. central bank may slow its $85 billion of asset purchases this year.

Turquoise Hill Resources advanced 7.5 percent to C$6.20.

Mongolia cleared Rio Tinto Group’s $6.6 billion Oyu Tolgoi copper mine to begin shipments this week. Turquoise Hill is a Rio unit that owns 66 percent of the mine. The government owns 34 percent.

Shipments to Chinese smelters were postponed twice last month as Mongolia sought to ensure revenue from the mine is processed through domestic banks. Mines Minister Davaajav Gankhuyag signaled in a post yesterday that the dispute has been resolved.

US

By Lu Wang and Whitney Kisling

July 8 (Bloomberg) — U.S. stocks rose, giving the Standard & Poor’s 500 Index a third straight day of gains, as the start of corporate earnings season fueled increased optimism about growth in the world’s largest economy.

Alcoa Inc. increased 1.4 percent before the biggest U.S. aluminum producer reported results. The stock added another 1.3 percent in extended trading after earnings beat analysts’ estimates. Dell Inc. gained 3.1 percent as the largest shareholder-advisory firm said investors should accept founder Michael Dell’s buyout offer. Priceline.com rallied 3.9 percent after Morgan Stanley raised its recommendation on the stock.

Intel Corp. slumped 3.6 percent amid an analyst downgrade.

The S&P 500 added 0.5 percent to 1,640.46 at 4 p.m. in New York, the highest since June 18. The Dow Jones Industrial Average rose 88.85 points, or 0.6 percent, to 15,224.69. More than 6 billion shares traded hands on U.S. exchanges today, about 8 percent below the three-month average.

“I really don’t think the earnings season is going to be so much about the second quarter, but more about the pickup in second half that the market appears to be anticipating,” Gary Flam, who helps oversee $7 billion at Bel Air Investment Advisors LLC in Los Angeles, said in a phone interview. “The market is getting comfortable that the economy is strong enough to withstand reduced Fed support. The market is inching toward normalcy. We’re not in an abnormal environment where the Fed and Fed actions are dictating market movements.”

The S&P 500 gained 1.6 percent last week, as better-than- estimated economic data tempered concern over a possible scaling back of Fed stimulus measures. Employers added more jobs than forecast in June, and other data during the week showed jobless claims decreased and manufacturing improved. While the index has fallen 1.7 percent since its May 21 record, the gauge is up 15 percent for 2013.

Investors will gain more insight into the central bank’s plans when the Federal Open Market Committee publishes minutes from its June meeting on July 10. Chairman Ben Bernanke also speaks that day. He said on June 19 the Fed may pare its asset- purchase program this year and end it in mid-2014 if growth meets policy makers’ estimates.

The S&P 500 fell nearly 5 percent in the four days after Bernanke’s comments following the FOMC meeting. The gauge has since gained 4.3 percent and is about 0.7 percent below its June 18 close.

“All eyes this week are likely to be on the latest FOMC minutes and comments from Ben Bernanke in light of Friday’s better-than-expected payrolls numbers,” Michael Hewson, a market analyst at CMC Markets Plc in London, wrote in an e-mail.

“Will he offer any clues as to the timing of possible tapering or will he simply reiterate previous comments made a few weeks ago?”

Earnings at companies listed on the S&P 500 rose 1.8 percent last quarter, down from a projection of 8.7 percent six months ago, according to more than 11,000 analyst estimates compiled by Bloomberg. Lower expectations helped about 73 percent of the companies in the benchmark measure exceed forecasts by an average of 5.1 percent for the first three months of the year, Bloomberg data show.

The Chicago Board Options Exchange Volatility Index, or VIX, fell 0.7 percent today to 14.78. The equity volatility gauge, which moves in the opposite direction as the S&P 500 about 80 percent of the time, reached a six-month high in June and has since dropped 28 percent.

Eight of 10 industry groups in the S&P 500 advanced as utility companies and makers of consumer staples rose more than 1 percent. The Russell 2000 Index, a benchmark measure for smaller companies, climbed 0.4 percent to a record.

Alcoa rose 1.4 percent to $7.92 before becoming the first Dow member to report results. The stock added another 1.3 percent at 4:30 p.m. in New York after second-quarter earnings beat analysts’ estimates as U.S. carmakers used more of the lightweight metal in their latest models.

The company, which had its credit rating cut to junk by Moody’s Investors Service in May, said profit excluding one-time items was 7 cents a share, exceeding the 6-cent average of 15 estimates compiled by Bloomberg. Sales fell to $5.85 billion, exceeding the $5.79 billion average of nine estimates.

Dell rose 3.1 percent to $13.44 after Institutional Shareholder Services Inc. said investors should accept founder Michael Dell’s $24.4 billion leveraged buyout plan for the company. ISS cited a 25.5 percent premium to Dell’s unaffected share price, the certainty of value provided by an all-cash offer and the transfer of risk given Dell’s deteriorating PC business among reasons for supporting the bid.

Priceline.com added 3.9 percent to $888.63. The stock has rallied nine straight days, adding 10 percent since June 24.

Morgan Stanley upgraded the online travel agent to overweight, meaning investors should buy the stock, on expectation that the company will fetch a higher valuation as its profit margin stabilizes amid market-share gains.

Coal stocks rallied as Davenport & Co. said Walter Energy Inc. may idle some production, squeezing supplies. Walter Energy jumped 4.6 percent to $10.81. Consol Energy Inc. advanced 4 percent to $27.56 while Peabody Energy Corp. climbed 4.9 percent to $15.37.

Utility companies in the S&P 500 jumped 1.4 percent as a group. NRG Energy Inc. gained 4.2 percent to $27.23. The largest independent U.S. electricity generator said its NRG Yield Inc. unit is selling stock in an initial public offering.

Intel slumped 3.6 percent, the most in the Dow and S&P 500, to $23.19. Evercore Partners Inc. cut its 2013 and 2014 earnings estimates for the world’s largest computer-chip maker and lowered the rating to underweight from equal weight.

The earnings cut dragged technology shares lower, with the group retreating 0.2 percent. Hewlett-Packard Co., the only other stock in the Dow to retreat today, plunged 1.6 percent.

Phone stocks slipped 0.4 percent as a group to pace losses in the S&P 500. Sprint Nextel Corp. fell 1.3 percent to $7.07.

Regeneron Pharmaceuticals Inc., maker of the Eylea eye- disease medicine, dropped 1.9 percent to $229.02. Ohr Pharmaceutical Inc. has enrolled half of the 120 patients needed for a mid-stage study for an age-related eye disorder, as it seeks to compete with Regeneron.

Have a wonderful evening everyone.

Be magnificent!

 

Our responsibility is no longer to acquire, but to be.

-Rabindranath Tagore, 1861-1901

As ever,

Carolann

Have patience.  All things are difficult before

they become easy.

-Saadi, 1210-1292

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

 

Tel: 778.430.5808

(C): 250.881.0801

Toll Free: 1.877.430.5895

Fax: 778.430.5828

www.carolannsteinhoff.com

 

 

 

Dear Friends,

Tangents:

Virginia Woolf wrote in her diary on July 5^th, 1924:

Just back….from Knole, where indeed I was invited to lunch alone with his Lordship [Lord Sackville].  His Lordship lives in the kernel of a vast nut.  You perambulate miles of galleries; skip endless treasures – chairs that Shakespeare might have sat on – tapestries, pictures, floors made of the halves of oaks; and penetrate at length to a round shiny table with a cover laid for one.  A dozen glasses form a circle each with a red rose in it.  One solitary peer sits lunching by himself, with his napkin folded into the shape of a lotus flower.  Knole is a conglomeration of buildings half as big as Cambridge I dare say; if you stuck Trinity, Clare and King’s together you might approximate.  But the extremities and indeed the inward parts are gone dead.  Ropes fence off half the rooms; the chairs and the pictures look preserved; life has left them.  Not for a hundred years have the retainers sat down to dinner in the great hall.  Then there is Mary Stuart’s altar, where she prayed before execution.  “An ancestor of ours took her the death warrant,” said Vita.

Vita Sackville-West, daughter of Lord Sackville and wife of Harold Nicolson, was soon to become Virginia Woolf’s lover.   A central figure in the Bloomsbury group of artists and writers, she was the model for Virginia Woolf’s Orlando.

It wasn’t raining when Noah built the ark. –Warren Buffett, b. 1930.

Photos of the Day –July 5th, 2013

The Great Mosque of Djenné is the largest mud-brick structure in the world. Built in 1906 by order of the French colonial administration in Mali, the mosque is an African icon. (Note the many palm wood platforms sticking out of the building’s walls.) Thomas Martinez

The minarettes of the mosque are repaired as the sun rises over the horizon. The mud festival is the only time of the year when everyone has complete access to the mosque, regardless of race, religion, or sex. For most people of Djenne, this is the only time they are allowed up to the roof of the mosque, and dozens rush to help repair the minarettes before they’re finished. Thomas Martinez

Market Closes for July 5^th, 2013

Market  Index	Close	Change
Dow  Jones	15135.84	+147.29    +0.98%
S&P 500	1631.89	+16.48      +1.02%
NASDAQ	3479.380	+35.710      +1.04
TSX	12134.91	-31.75
		-0.26%

International Markets

Market  Index	Close	Change
NIKKEI	14309.97	+291.04
		+2.08%
HANG  SENG	20854.67	+386.00
		+1.89%
SENSEX	19495.82	+84.98
		+0.44%
FTSE 100	6375.52	-46.15
		-0.72%

Bonds

Bonds	% Yield	Previous % Yield
CND.  10 Year Bond	2.550	2.418
CND.   30 Year Bond	2.973	2.858
U.S.   10 Year Bond	2.7391	2.5032
U.S.   30 Year Bond	3.7130	3.4931

Currencies

BOC Close	Today	Previous
Canadian $	0.94520	0.95095
US   $	1.05797	1.05158
Euro Rate  1 Euro=		Inverse
Canadian   $	1.35731	0.73675
US  $	1.28293	0.77946

Commodities

Gold	Close	Previous
London Gold   Fix	1223.20	1250.43
Oil	Close	Previous
WTI Crude Future	1.0322	101.24
BRENT	108.10	105.96

Market Commentary:

Canada

By Eric Lam

July 5 (Bloomberg) — Canadian stocks fell, with the benchmark index paring a weekly gain, as gold producers tumbled after better-than-forecast jobs reports fueled bets the U.S. Federal Reserve will begin to reduce stimulus.

Torex Gold Resources Inc. and Yamana Gold Inc. slumped at least 3 percent as the precious metal touched a one-week low.

Barrick Gold Corp., the world’s largest producer, sank to a 21- year low. Tourmaline Oil Corp. surged to a record after announcing expansion plans in Alberta. Progressive Waste Solutions Ltd. jumped the most in almost two years after an investor boosted its stake in the garbage-disposal company.

The Standard & Poor’s/TSX Composite Index fell 31.75 points, or 0.3 percent, to 12,134.91 at 4 p.m. in Toronto. The gauge rose 0.1 percent this week and is off 2.4 percent for the year.

“When you look at gold, investors were holding it as a potential inflation hedge,” said Anish Chopra, fund manager with TD Asset Management Inc. in Toronto. The firm manages C$204 billion ($192 billion). “Here you have the U.S. probably pulling back on quantitative easing because economic growth is starting to pick up. The risk of inflation gets reduced as easing gets pulled back. For sure the economic data supports tapering.”

The U.S. economy added 195,000 jobs in June, ahead of the average economist estimate of 165,000 in a Bloomberg survey.

Canada lost 400 jobs last month, better than analysts’ forecasts for a decline of 7,500.

Fed policy makers said last month they would trim stimulus before the end of the year if unemployment continues to fall.

Today’s jobs report fueled speculation the Fed would begin to curtail bond purchases in September, boosting the U.S. dollar to the biggest gain in almost eight months.

Seven of 10 groups in the S&P/TSX fell, led by a 1.6 percent plunge among raw-materials producers. Metals prices tumbled as the dollar advanced, with gold for August delivery declining 3.1 percent to $1,212.70 an ounce, the lowest since June 28.

Torex Gold Resources plunged 12 percent to C$1.17 and Yamana Gold slumped 3 percent to C$9.74. Barrick Gold sank 4.8 percent to C$14.57, the lowest since 1992.

Silver Wheaton Corp. tumbled 2.5 percent to C$19.95 and Silvercorp Metals Inc. retreated 1.1 percent to C$2.75. Silver for September delivery dropped 4.9 percent to extend the loss for the year to 38 percent, the most among the 24 raw materials in the S&P GSCI Spot Index.

Teck Resources Ltd., Canada’s largest diversified miner, lost 3.2 percent to C$21.55 and First Quantum Minerals Ltd.

slipped 1.3 percent to C$15.35. Copper fell 3.4 percent, the most since April, in New York.

Tourmaline jumped 4.4 percent to C$44.65, its highest close on record. The company said late yesterday it expects to get

10,000 barrels of oil equivalent per day production by the fourth quarter from its Spirit River Charlie Lake site in Alberta.

The oil and gas producer has surged 43 percent this year, making it the top-performing stock in the S&P/TSX Energy Index.

Progressive Waste, based in Vaughan, Ontario, soared 4.9 percent to C$23.38, the most since August 2011. Blue Harbour LP, a Greenwich, Connecticut-based investor, said in a regulatory filing today it has paid $130.8 million to raise its stake in the company to 5.6 percent, making it the third-largest investor.

US

By Lu Wang and Alex Barinka

July 5 (Bloomberg) — U.S. stocks rose, sending the Standard & Poor’s 500 Index to the biggest rally in three weeks, after government data showed the nation added more jobs than forecast last month.

Lincoln National Corp. climbed 5.4 percent, leading a rally among life insurers as bond yields surged on bets the Federal Reserve will begin to reduce its asset buying. KeyCorp advanced as Wells Fargo & Co. said regional banks benefit more than larger rivals from new rules on capital. Tesla Motors Inc. added

4.2 percent after saying it received enough orders to double the number of electric cars in Hong Kong. Homebuilders slumped amid concern rising interest rates may curtail a housing recovery.

The S&P 500 gained 1 percent, the most since June 13, to 1,631.89 at 4 p.m. in New York. The index advanced 1.6 percent for the week. The Dow Jones Industrial Average added 147.29 points, or 1 percent, to 15,135.84. About 4.95 billion shares changed hands, 24 percent below the three-month average. U.S. markets were closed yesterday for the Independence Day holiday.

“The jobs report is pretty strong. It’s a good number for equities because it’s supportive for earnings growth, which is what we need,” Matthew Peron, head of active equities at Northern Trust Corp. in Chicago, said by telephone. His firm manages about $810 billion. “We have to digest the backup in yields, we have to see how far do they go and get used to that level of rates.”

Payrolls rose by 195,000 workers for a second straight month, the Labor Department reported today in Washington. The median forecast in a Bloomberg survey projected a 165,000 gain after a previously reported 175,000 increase in May. The jobless rate stayed at 7.6 percent, while hourly earnings in the year ended in June advanced by the most since July 2011.

Economic growth amid monetary stimulus from the Federal Reserve has helped send the S&P 500 up 141 percent from its bear-market low in 2009, including a 14 percent rally so far this year. The index has slipped 2.2 percent from its last record on May 21 after Fed Chairman Ben S. Bernanke said the central bank could begin to reduce bond purchases should the employment market show sustainable growth.

“Part of this focus on the Fed easing is that they haven’t been enthusiastic about the underlying economics,” said Bruce McCain, who helps oversee more than $20 billion as chief investment strategist at the private-banking unit of KeyCorp in Cleveland. “If investors can be reassured about that, then it opens the door to a more sustainable rally.”

Equities rose earlier today as European Central Bank President Mario Draghi predicted that interest rates will remain low for an extended period of time. Draghi said yesterday that key interest rates will remain at their current levels or lower for as long as necessary. The Bank of England signaled that it will leave interest rates at a record low for longer than investors had expected.

Alcoa Inc. will unofficially start the second-quarter earnings season as the biggest U.S. aluminum producer will report results after the market closes on July 8.

Profits for S&P 500 stocks probably grew 1.8 percent, according to analyst estimates compiled by Bloomberg. That’s down from a projected increase of 6.2 percent at the beginning of the quarter. Earnings are forecast to jump 5.5 percent for the third quarter and 11 percent for the final three months of this year, the data show.

“We know this is not going to be a terrific earnings season,” Northern Trust’s Peron said. “The focus will be on guidance – are we going to get improvement as the year continues, which is in expectation? The criticism of the market has been that it has been supported by Fed actions and now this is the time for that hand-off to happen.”

The Chicago Board Options Exchange Volatility Index, or VIX, slipped 8.1 percent today to 14.89, the lowest level since May 30. The equity volatility gauge, which moves in the opposite direction as the S&P 500 about 80 percent of the time, reached a six-month high in June and has since fallen 27 percent.

Nine of 10 S&P 500 main industries gained as financial, industrial and health-care companies rose more than 1.3 percent.

JPMorgan Chase & Co. added 2.3 percent to $53.99 and Bank of America Corp. advanced 1.8 percent to $13.06.

Lincoln, the life insurer with more than $200 billion in assets, climbed 5.4 percent to $38.98. Higher interest rates can boost profits for life insurers, which invest premiums from clients in bonds and other assets to back future payouts.

MetLife Inc., the largest U.S. life insurer, gained 2.7 percent to $47.52.

Regional lenders rose as KeyCorp, Ohio’s second-largest bank, jumped 5 percent to $12. Smaller banks face less onerous risk weightings for residential mortgages under the Basel Committee on Banking Supervision’s latest set of global standards, Wells Fargo analyst Matthew Burnell wrote in a note.

The capital rules are scheduled to be decided next week.

SunTrust Banks Inc. advanced 4.2 percent to $34.31, while Zions Bancorporation increased 4.3 percent to $30.97.

Tesla Motors Inc. added 4.2 percent to a record $120.09 after saying it received hundreds of orders for its new Model S sedan, enough to double the number of electric cars on Hong Kong’s streets. The company, headed by billionaire Chief Executive Officer Elon Musk, has forecast it will sell 21,000 units of the Model S globally this year, with deliveries to Europe and Asia beginning in the second half.

Zoetis Inc., the animal-health company spun off from Pfizer Inc., gained 3 percent to $30.17. Bank of America boosted the stock’s rating to buy.

An S&P index of homebuilders fell 3.4 percent to the lowest level since December as Treasury yields rose to the highest level in almost two years. All its 11 members retreated. Toll Brothers Inc. dropped 3 percent to $31.52 while Lennar Corp. slipped 4 percent to $33.93.

A Bloomberg index of real estate investment trusts that buy mortgage debt tumbled 3.9 percent for the biggest retreat since October 2011. Annaly Capital Management Inc., the largest of the companies, plunged 5.1 percent to $11.51 and American Capital Agency Corp., the second biggest, slumped 5.3 percent to $20.76.

Gold producers declined as the metal’s price plunged 3.1 percent. Barrick Gold Corp., the world’s largest miner of the precious metal, sank 6.3 percent to $13.76. Newmont Mining Corp. fell 4.3 percent to $27.78 for the biggest loss in the S&P 500.

Dell Inc. erased 2.1 percent to $13.03. Michael Dell and Silver Lake Management LLC won’t sweeten their $24.4 billion offer to take the personal-computer maker private, people with direct knowledge of the situation said.

Have a wonderful weekend everyone.

Be magnificent!

If you wish to free yourself from suffering, you must free yourself from pleasure,

and not free yourself from suffering.  Suffering is a reaction.

If you wish to release yourself from suffering,

you must first of all release yourself from pleasure.

Then the suffering will disappear.

Swami Prajnanpad, 1891-1974

As ever,

 

Carolann

 

The test of good manners is to be patient

with the bad ones.

-Solomon ibn Gabriol, 1021-1058

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

 

Tel: 778.430.5808

(C): 250.881.0801

Toll Free: 1.877.430.5895

Fax: 778.430.5828

www.carolannsteinhoff.com

 

 

 

Dear Friends,

Tangents:

The “Dog Days of Summer” begin today and end on August 11^th.  These are the hottest days of the year in the northern hemisphere.  They are so named because originally they were the days when Sirius, the Dog Star, rose just before or at about the same time as sunrise, which is no longer true due to the precession of the equinoxes.  The Ancients sacrificed a brown dog at the beginning of the Dog Days to appease the rage of Sirius, believing that the star was the cause of the hot sultry weather.

Happy Thought

-Robert Louis Stevenson

The world is so full of a number of things,

I’m sure we should all be as happy as kings.

Photos of the Day –July 3rd, 2013

The Statue of Liberty, which has been closed to visitors since Superstorm Sandy, is scheduled to reopen for tours July Fourth, when Statue Cruises resumes departures for Liberty Island from Lower Manhattan. Mark Lennihan/AP/File

A Bald Eagle juvenile on its nest at Heritage Park, Kirkland, Washington, June 21, 2013. The floating launch pad for July Fourth fireworks display in suburban Seattle was moved from its usual site to avoid frightening a pair of baby bald eagles nesting in a tree on the shore of Lake Washington Mick Thompson/Reuters

Market Closes for July 3^rd, 2013

Market  Index	Close	Change
Dow  Jones	14988.55	+56.14    +0.38%
S&P 500	1615.41	+1.33    +0.88%
NASDAQ	3443.670	+10.273    +0.30%
TSX	12145.68	-32.70
		-0.27%

International Markets

Market  Index	Close	Change
NIKKEI	14055.56	-43.18
		-0.31%
HANG  SENG	20147.31	-511.34
		-2.48%
SENSEX	19177.76	-286.06
		-1.47%
FTSE 100	6229.87	-74.07
		-1.17%

Bonds

Bonds	% Yield	Previous % Yield
CND.  10 Year Bond	2.414	2.407
CND.   30 Year Bond	2.858	2.853
U.S.   10 Year Bond	2.5032	2.4693
U.S.   30 Year Bond	3.4931	3.4729

Currencies

BOC Close	Today	Previous
Canadian $	0.95175	0.94760
US   $	1.05070	1.05530
Euro Rate  1 Euro=		Inverse
Canadian   $	1.36711	0.73147
US  $	1.30115	0.76855

Commodities

Gold	Close	Previous
London Gold   Fix	1253.51	1243.65
Oil	Close	Previous
WTI Crude Future	101.24	99.60
BRENT	105.95	104.16

Market Commentary:

Canada

By Eric Lam

July 3 (Bloomberg) — Canadian stocks fell for the first time in four days, as unrest in Egypt and a political crisis in Portugal roiled global markets.

BlackBerry extended its loss to 33 percent in the three sessions since reporting disappointing sales for its Z10 smartphone on June 28. Sandvine Corp., a broadband network tools provider, slumped 7.6 percent as second-quarter sales missed estimates. Alamos Gold Inc. rose 4 percent as the price of the precious metal advanced.

The Standard & Poor’s/TSX Composite Index fell 32.70 points, or 0.3 percent, to 12,145.68 at 4 p.m. in Toronto, trimming an earlier decline of as much as 1 percent. The gauge has fallen 2.3 percent this year. Trading volume was 32 percent below the 30-day average.

“We don’t know if the situation in Egypt will get out of hand and whether it will spread into other countries,” said Irwin Michael, fund manager with ABC Funds in Toronto. He helps manage about C$800 million ($759 million). “In Portugal, two members resigned and they’re worried about that spreading to Spain as well. The sovereign debt issue appears to be flaring up in Europe. There’s a lot of uncertainty right now, in the context of a long weekend in the U.S., so we expect the market between now and when you come in on Monday to be very volatile.”

The MSCI All-Country World Index dropped 0.5 percent as Egypt’s military ousted President Mohamed Mursi from power, suspended the constitution and announced an early presidential election in a bid to resolve the political crisis that has polarized the nation. Oil spiked to a 14-month high amid concern the turmoil will disrupt shipments in the Suez Canal. Portugal’s main equity gauge slumped 5.3 percent after two ministers resigned as the country struggles to implement budget cuts.

Nine of 10 industries in the S&P/TSX retreated today, with materials producers the only group to advance. U.S. markets closed at 1 p.m. in New York, erasing early losses to advance 0.1 percent. The American exchanges remain closed July 4 for the Independence Day holiday.

BlackBerry slid 1.4 percent to C$10.08. The company formerly known as Research In Motion Ltd. last week missed analysts’ estimates for phone shipments and profit. The Waterloo, Ontario-based smartphone maker has slipped 15 percent this year.

Sandvine sank the most since September, losing 7.6 percent to C$1.95. The company reported second-quarter sales of $23.5 million, short of analyst estimates of $24.9 million. It also posted adjusted earnings of 1 cent, in line with expectations.

Utilities stocks tumbled 1.7 percent to pace losses in the S&P/TSX. Canadian Utilities Ltd. lost 3.4 percent to C$35.50 and Atlantic Power Corp. declined 3.8 percent to C$4.08.

Energy shares slumped 0.2 percent, paring an earlier decline of as much as 0.8 percent. Crude for August delivery rallied 1.6 percent to the highest since May 3, 2012. Encana Corp. retreated 0.5 percent to C$17.85 and Enbridge Inc. slid 0.8 percent to C$44.53.

Raw-materials producers added 1.1 percent as gold and silver prices advanced in New York. Alamos Gold rose 4 percent to C$13.09 and Centerra Gold Inc. climbed 6 percent to C$3.54.

First Majestic Silver Corp. rallied 6.7 percent to C$11.61 to lead gains among silver stocks.

US

By Lu Wang and Katie Brennan

July 3 (Bloomberg) — U.S. stocks rose, sending the Standard & Poor’s 500 Index to the highest level in two weeks, on better-than-estimated labor data as investors watched political developments in Egypt and Portugal.

Chipotle Mexican Grill Inc. advanced 3.5 percent amid an analyst upgrade. Time Warner Cable Inc. paced gains among telecommunication service providers as Macquarie Group Inc. predicted a “wave” of takeovers. Bank of America Corp. and Citigroup Inc. declined as Standard and Poor’s downgraded three European lenders. Alcoa Inc. fell 1.2 percent as JPMorgan Chase & Co. cut the stock’s rating.

The S&P 500 rose 0.1 percent to 1,615.41, the highest since June 19. The Dow Jones Industrial Average added 56.14 points, or 0.4 percent, to 14,988.55. About 3.6 billion shares traded hands, as U.S. exchanges closed at 1 p.m. New York time today.

Equities markets are shut tomorrow for the Independence Day holiday.

“Europe can’t hurt us, higher oil prices can’t hurt us,” Rick Fier, director of equity trading at Conifer Securities LLC in New York, said in an interview. His firm oversees $8 billion.

“Bernanke has the market finally saying that good news is good news and less QE is not a bad thing. If we can get some revenue growth, that would be the icing on the cake.”

The S&P 500 slumped as much as 5.8 percent since May 21, the day before Federal Reserve Chairman Ben S. Bernanke said the central bank may taper bond purchases, or quantitative easing, if the U.S. economy improves in line with forecasts. The index has since climbed 2.7 percent from the June low.

Jobless claims decreased to 343,000 in the week ended June 29 from a revised 348,000 in the prior period that was higher than initially reported, the Labor Department said today in Washington. Separate reports showed companies boosted employment by 188,000 workers in June while service industries unexpectedly expanded at the slowest pace in more than three years.

The data come before the government’s monthly labor report on July 5. That report will probably show employers created 165,000 jobs in June, from 175,000 a month earlier, according to the median forecast of economists in a Bloomberg survey. The unemployment rate probably fell to 7.5 percent, matching April’s four-year low.

Oil futures surged to as high as $102.18 a barrel, the most since May 2012, as political unrest in Egypt sparked concern of Middle East supply disruptions and a report showed U.S. stockpiles shrank in the week ended June 28.

After the close of U.S. markets, Egypt’s military ousted President Mohamed Mursi from power, suspended the constitution and announced an early presidential election in a bid to resolve the political crisis that has polarized the nation. The army said July 1 it would impose its own plan if Mursi didn’t end the turmoil and meet the people’s demands within 48 hours.

In Portugal, Prime Minister Pedro Passos Coelho told voters in a televised speech from Lisbon yesterday that he’s trying to hold his government together after Foreign Affairs Minister Paulo Portas, leader of junior coalition party CDS, quit.

The Chicago Board Options Exchange Volatility Index, or VIX, fell 1.5 percent today to 16.20, reversing an earlier rise of 5.4 percent. The equity volatility gauge, which moves in the opposite direction as the S&P 500 about 80 percent of the time, reached a six-year low in March and has since surged 43 percent.

Half of 10 main industries in the S&P 500 advanced as technology and consumer-discretionary stocks rose more than 0.5 percent. International Business Machines Corp. added 0.9 percent to $193.25 and Cisco Systems Inc. gained 1.1 percent to $24.59.

Chipotle climbed 3.5 percent to $384.47 for the biggest increase in the S&P 500. The fast-casual dining chain was raised to buy from hold by Argus Research Corp.

Time Warner advanced 2.7 percent to $112.45. Leap Wireless International Inc. jumped 5.7 percent to $7.07. The pay-as-you- go wireless carrier may be a takeover target for T-Mobile US Inc. or Dish Network Corp., Macquarie analysts said in a note, upgrading Leap to neutral from underperform.

Financial companies slid 0.3 percent, the most among 10 S&P 500 groups. Bank of America, the second-biggest U.S. lender by assets, retreated 0.5 percent to $12.83. Citigroup declined 1 percent to $47.67. In Europe, banks tumbled after S&P downgraded the credit ratings of Barclays Plc, Deutsche Bank AG and Credit Suisse Group AG, saying new rules and “uncertain market conditions” threaten their business.

Alcoa dropped 1.2 percent to $7.71 as JPMorgan lowered its recommendation on the shares to neutral from overweight, citing lower aluminum-price forecasts. The biggest U.S. aluminum producer will report results after the market closes on July 8, unofficially starting the second-quarter earnings season.

Profits for S&P 500 stocks probably climbed 2.4 percent, with financial and telephone companies the only two industries to have growth of more than 10 percent, according to analyst estimates compiled by Bloomberg. The estimate for the entire index is down from a projected increase of 6.2 percent at the beginning of the quarter.

“Money managers are waiting now for earnings to get a better idea of where to place funds,” John Augustine, who helps manage $27 billion as chief market strategist at Cincinnati- based Fifth Third Bancorp, said by phone. “It’s relatively unusual to have earnings growth that narrow and focused on the financial and telecom sectors. A lot of the sectors, the bar has been lowered and it may actually help them outperform estimates.”

Robert Half International Inc. lost 5.2 percent to $31.56 as Deutsche Bank AG said the Obama administration’s decision to delay a mandate requiring businesses to provide workers health insurance is negative for staffing service providers. Businesses won’t be penalized next year if they fail to provide workers health insurance. The so-called employer mandate, a key requirement under its signature 2010 health-care law, will be postponed until 2015, the Obama administration said.

Mead Johnson Nutrition Co. slumped 8.1 percent to $68.85.

John Baumgartner, an analyst with Wells Fargo & Co., cut the rating for the world’s largest baby-formula maker to market perform, an equivalent of neutral, from outperform, citing a pricing probe in China and weakening economic growth in developing countries.

 

Have a wonderful evening everyone.

 

Be magnificent!

 

Man falls from the pursuit of the ideal of plain living and high thinking

the moment he wants to multiply his daily wants.  Man’s happiness really lies in contentment.

Mahatma Gandhi, 1869-1948

As ever,

 

Carolann

 

A man who is a master of patience is a master

of everything else.

-George Savile, 1633-1695

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:

A new month – July ~ The seventh month, named by Mark Anthony in honour of Julius Caesar.  It was formerly called Quintilis, as it was the fifth month of the Roman year.  The old Dutch name for it was Hooy-maand, “hay month”, while the Anglo-Saxons knew it as Moedmonath, “meadow month”, because the cattle were turned into the meadows to feed then.  In the French Revolutionary Calendar the equivalent was Messidor, “harvest gift”, corresponding to the period June 20^th to July 19^th.  Until the 18^th century, July was accented on the first syllable.  Even as late as 1798 Wordsworth wrote:

In March, December, and in July,

‘Tis all the same with Harry Gill;

The neighbours tell, and tell you truly,

His teeth they chatter, chatter still.

“Goody Blake and Harry Gill.”

-from Brewar’s Dictionary of Phrase & Fable, 16^th ed.

And on July 2^nd, in…

1887: Writer Herman Hesse was born.  Eternity is a mere moment, just long enough for a joke. – Hermann Hess

1964: Civil Rights Act passed, outlawing racial segregation and discrimination.

1956: Model Jerry Hall was born.

1776: Declaration of Independence.

1937: Aviator Amelia Earhart disappears.

Photos of the Day –July 2nd, 2013

Fireworks celebrating Canada Day are seen over downtown Vancouver, as seen from Cypress Mountain in West Vancouver, British Columbia, Monday. Canadians were celebrating their country’s 146th birthday. Andy Clark/Reuters

A farmer carries freshly-picked sunflowers at a farm on the outskirts of Havana, Cuba, Monday. Desmond Boylan/Reuters

Market Closes for July 2^nd, 2013

Market  Index	Close	Change
Dow  Jones	14932.41	-42.55    -0.28%
S&P 500	1614.08	-0.88    -0.05%
NASDAQ	3433.396	-1.094    -0.03%
TSX	12178.38	+49.27
		+0.41%

International Markets

Market  Index	Close	Change
NIKKEI	14098.74	+246.24
		+1.78%
HANG  SENG	20658.65	-144.64
		-0.70%
SENSEX	19463.82	-113.57
		-0.58%
FTSE 100	6303.94	-3.84
		-0.06%

Bonds

Bonds	% Yield	Previous % Yield
CND.  10 Year Bond	2.407	2.439
CND.   30 Year Bond	2.853	2.896
U.S.   10 Year Bond	2.4693	2.4857
U.S.   30 Year Bond	3.4729	3.4994

Currencies

BOC Close	Today	Previous
Canadian $	0.94760	0.95097
US   $	1.05530	1.05156
Euro Rate  1 Euro=		Inverse
Canadian   $	1.36926	0.73032
US  $	1.29752	0.77070

Commodities

Gold	Close	Previous
London Gold   Fix	1243.65	1234.57
Oil	Close	Previous
WTI Crude Future	99.60	96.56
BRENT	104.16	102.30

Market Commentary:

Canada

By Eric Lam

July 2 (Bloomberg) — Canadian stocks rose a third day, reaching the highest close in almost two weeks, as health-care shares surged and energy producers rallied on higher crude prices to offset losses among metal producers.

Valeant Pharmaceuticals International Inc. added 4.8 percent after setting up a physician loyalty program in the U.S. with Mentor Worldwide LLC. Penn West Petroleum Ltd. and Athabasca Oil Corp. jumped more than 5 percent as crude rallied to a 14-month high on concern that protests in Egypt will threaten supplies. Barrick Gold Corp. and Silvercorp Metals Inc. plunged at least 7.1 percent as prices for the metals retreated.

The Standard & Poor’s/TSX Composite Index rose 49.27 points, or 0.4 percent, to 12,178.38 at 4 p.m. in Toronto, the highest since June 19. The gauge has fallen 2.1 percent this year. Trading volume was in line with the 30-day average.

“There’s concern in Egypt, oil is up,” said Ian Nakamoto, director of research with MacDougall MacDougall & MacTier Inc. in Toronto. The firm manages about C$4 billion ($3.8 billion).

“We’re waiting for Friday’s non-farm payroll reports. The best thing for the equity market is if the U.S. economy continues to improve, but at a slower pace than the Fed expects, which will push out the end of QE.”

Markets in Toronto were closed yesterday for the Canada Day holiday, while the S&P 500 rose 0.5 percent in the U.S.

Investors there continue to weigh data and statements from Federal Reserve officials to determine whether the world’s largest economy is strong enough for the central bank to scale back stimulus measures. The S&P 500 slipped 0.1 percent, ahead of the monthly jobs report on July 5. The U.S. is Canada’s largest trading partner.

Seven of 10 industries in the S&P/TSX advanced, extending the index’s three-day rally to 1.9 percent. Health-care stocks paced gains, adding 3.1 percent. The group has surged 40 percent this year and closed today at its highest since 2000.

Valeant Pharmaceuticals jumped 4.8 percent to C$95, the biggest jump since May 27. The company’s Medicis skin care division is introducing a five-year loyalty program in the U.S. that will include Mentor’s line of breast implant products. The program gives physicians incentives for using Medicis and Mentor products.

Telus Corp. rallied 3.1 percent to C$31.66 after analysts with Canaccord Financial Inc. said investors had overestimated how much Verizon Communications Inc. may shake up Canada’s wireless market. Verizon said last month it was considering entering the Canadian mobile-phone market, and the Globe and Mail reported June 26 the company had submitted a bid for Toronto-based Wind Mobile.

Telus plunged 8 percent on the June 26 report, and Rogers Communications Inc., the largest wireless carrier in Canada, retreated 9.2 percent that day. Rogers added 2.8 percent to C$42.37 today.

Penn West Petroleum climbed 5 percent to C$11.65 and Athabasca Oil rose 6.1 percent to C$6.91, driving the S&P/TSX Energy Index to a 1.4 percent gain, the most in six weeks.

The price of crude rallied 1.6 percent to $99.60 a barrel, the highest settlement since May 2012, on speculation U.S. inventories may have dropped 2.25 million barrels last week to the lowest level since May 31, according to a Bloomberg survey before a report tomorrow. Oil extended gains as the political showdown escalated in Egypt, which controls the Suez Canal, a key transit point for oil tankers.

Raw-materials producers led declines in the S&P/TSX, falling 2.1 percent as a group. Gold slid for the first time in three sessions and silver futures slumped 1.4 percent. Endeavour Silver Corp. tumbled 9.9 percent to C$3.28 after surging 16 percent June 28. Silvercorp Metals plunged 7.1 percent to C$2.74.

Barrick Gold, the world’s largest producer, slumped 7.7 percent to C$15.32, the lowest level since 1992. Jefferies LLC analyst Peter Ward downgraded the stock to hold from buy. The gold miner on June 28 said it may write down as much as $5.5 billion on its Pascua-Lama project in the Andes after the price of the metal plunged close to a three-year low.

Barrick is also likely to take other “significant” impairment charges for the second quarter as it reviews goodwill and other assets, the Toronto-based company said.

BlackBerry slumped 7.3 percent to C$10.22, its lowest close since November. The BlackBerry 10 smartphone maker has plunged 35 percent in the past three days, after reporting a surprise loss in its first quarter due to lackluster sales of the Z10 touchscreen phone.

US

By Lu Wang and Katie Brennan

July 2 (Bloomberg) — U.S. stocks fell, erasing earlier gains, as the Standard & Poor’s 500 Index failed to hold above its average level from the past 50 days and investors awaited a monthly jobs report and the start of corporate earnings.

DaVita HealthCare Partners Inc. tumbled 5.9 percent after the government proposed reducing payments to dialysis-center operators. Constellation Brands Inc. slumped 3.6 percent after posting first-quarter earnings that trailed analysts’ estimates.

Ford Motor Co. and Abercrombie & Fitch Co. added at least 2.8 percent amid optimism over sales. Zynga Inc. jumped 6.5 percent after naming a new chief executive officer.

The S&P 500 slipped 0.1 percent to 1,614.08 in New York, after rising as much as 0.6 percent earlier. The Dow Jones Industrial Average dropped 42.55 points, or 0.3 percent, to 14,932.41. More than 6.1 billion shares traded hands on U.S. exchanges today, or 6.9 percent below the three-month average.

“The market is trying to find some ability to hold in there,” Jason Cooper, who helps oversee $2.5 billion in South Bend, Indiana, at 1st Source Investment Advisors, said in a phone interview. “It’s going to take some actual data to come in to at least reassure investors that the economy is doing OK and people are getting jobs. Corporate America is going to be the important one right now. The Fed has pretty much said what they have to say and not rock the boat any more.”

Stocks climbed earlier as factory orders topped estimates and the Federal Reserve’s William Dudley reiterated that the central bank may prolong bond purchases if needed. The S&P 500 reversed gains after momentarily rising above its 50-day moving average near 1,624. The benchmark gauge also pared gains yesterday after briefly exceeding the technical level.

Goldman Sachs Group Inc. cut its growth forecast for second-quarter U.S. gross domestic product by 1/10 to 1.7 percent after a slower-than-estimated expansion in manufacturing inventories.

Data tomorrow from the ADP Research Institute may indicate American companies increased employment in June. Investors will watch the monthly U.S. labor report later this week for further signs of economic strength. Employers in the U.S. probably created 165,000 jobs in June, almost the same as in the prior month, according to the median forecast of economists in a Bloomberg survey ahead of July 5 figures from the Labor Department. The unemployment rate probably fell to 7.5 percent, matching April’s four-year low.

Alcoa Inc. will unofficially start the second-quarter earnings season after the market close on July 8, as the biggest U.S. aluminum producer becomes the first company in the Dow to report results. Profits from S&P 500 companies probably grew 2.4 percent, according to analyst estimates compiled by Bloomberg.

That’s down from a projected increase of 6.2 percent at the beginning of the quarter.

“The recent economic news has been solid but now the market will look to see where earnings come in to drive the next leg up if we continue in this trend,” said James Dunigan, who helps oversee $112 billion as chief investment officer in Philadelphia at PNC Wealth Management. “We have rebounded nicely after the stumble from the Fed meeting in June so we will start to run into some resistance as we head higher.”

The S&P 500 has dropped 3.3 percent since May 21, the day before Fed Chairman Ben S. Bernanke signaled the central bank could scale back asset purchases if the economy improves in line with forecasts. The benchmark gauge rallied 13 percent in the first half of the year, the best performance since a 17 percent gain in the first six months of 1998.

The Chicago Board Options Exchange Volatility Index, or VIX, added 0.4 percent today to 16.44. The equity volatility gauge, which moves in the opposite direction as the S&P 500 about 80 percent of the time, reached a six-year low in March and has since surged 45 percent.

Four out of 10 S&P 500 industries fell as industrial and raw-material companies dropped more than 0.3 percent. Energy and telephone stocks climbed at least 0.2 percent.

DaVita HealthCare tumbled 5.9 percent to $114. Dialysis- center operators may see U.S. payments reduced 9.4 percent in 2014 under a Medicare proposal. The government will consider phasing reductions over more than a year, the Health and Human Services Department said yesterday in a regulatory filing. The proposal is subject to public comment and may change before taking effect.

Constellation Brands lost 3.6 percent to $51.25. The wine company reported adjusted first-quarter earnings of 38 cents a share, missing the average analyst estimate of 40 cents.

Mead Johnson Nutrition Co. slipped 5.7 percent to $74.90.

The world’s largest baby-formula maker said the National Development and Reform Commission, China’s top economic planning agency, carried out a review of documents related to product pricing at Mead Johnson’s China unit recently. The U.S. company said it’s providing “full” cooperation.

China is probing foreign milk-powder companies including Danone and Nestle SA for possibly violating anti-monopoly laws and setting prices too high, the People’s Daily reported.

Achillion Pharmaceuticals Inc. plunged 25 percent to $6.26.

The company said U.S. regulators stopped the clinical trial of one of its drugs for hepatitis C after some patients experienced elevated liver enzymes.

Linn Energy LLC, the oil and natural gas partnership that agreed to buy Berry Petroleum Co. in February, plunged 19 percent to $27.05, after disclosing a U.S. Securities and Exchange Commission inquiry of the transaction and its accounting.

Ford rose 2.8 percent to $16.18. The automaker’s sales of cars and light trucks climbed 13 percent to 234,917 last month, beating the 12 percent increase that was the average of 11 estimates.

Retailers advanced. U.S. sales at stores open at least one year rose 2.9 percent from a year earlier during the week ended June 29 as concern over increased inventory and markdowns eased, Johnson Redbook Research said.

Abercrombie & Fitch climbed 3.8 percent to $47.93. The teen retailer may see acceleration in margin expansion amid sales stabilization and cost reductions, Piper Jaffray Cos. wrote in a note, reiterating the stock as a top pick.

Zynga jumped 6.5 percent to $3.27. The maker of social- networking games named Don Mattrick, the former head of Microsoft’s entertainment division, as its new CEO. Mattrick will start July 8, the company said.

Nielsen Holdings NV, the biggest provider of U.S. television ratings, increased 2.1 percent to $33.97. The company will replace Sprint Nextel Corp. in the S&P 500 after the end of trading July 8, S&P said in a statement.

iPhone maker Apple Inc. climbed 2.3 percent to $418.49 for a third straight day of gains. The world’s most valuable technology company is nearing a deal with Time Warner Cable Inc. to give subscribers of the cable television service access to channels via Apple TV, people with knowledge of the negotiations said.

Apple’s shares have retreated 40 percent from a record high in September amid concern that Chief Executive Officer Tim Cook has taken too long to deliver a new breakthrough product to help make up for stiffer iPhone competition.

 

Have  a wonderful evening everyone.

 

Be magnificent!

 

To understand pleasure is not to deny it.

We are not condemning it or saying it is right or wrong but if we pursue it,

let us do so with our eyes open, knowing that a mind that is all the time seeking pleasure

must inevitably find its shadow in pain.

They cannot be separated, although we run after pleasure and try to avoid pain.

Krishnamurti,1895-1986

As ever,

 

Carolann

 

Patience is bitter, but its fruit is sweet.

-Jean-Jacques Rousseau, 1712-1778

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:

Interesting item in the Wall Street Journal today:

• Scientists unlock mystery in evolution of pitchers. Scientists say that the “classic overhand throw used by baseball players” is an evolutionary adaptation preceded by anatomical changes that first appeared 1.8 million years ago. The secret is not muscle strength—otherwise Major League Baseball would be recruiting chimpanzees—but the ability of the shoulder, arm and the rest of the body, including the waist, to store elastic energy. “It works just like a slingshot would. You’re actually stretching the ligaments,” the author of a recent report tells the New York Times’s James Gorman. It would be over a million and half years after the appearance of the open shoulder and twistable waist that “homo sapiens, the species that would eventually form both the American and National Leagues,” would appear on the scene, Gorman notes. And even then, humans “did not evolve the intellectual power and wisdom to invent the rules of baseball until the 19th century.” Evolution took a small step back in 1973 with the adoption of the designated-hitter rule.

Science > Art:

“Score another one for Wolfgang Amadeus,” says Pacific Standard magazine.  “Researchers report the soothing sounds of a Mozart minuet boost the ability of children and seniors to focus on a task and ignore extraneous information.  Dissonant music has the opposite effect, according to Nobuo Masataka of Japan’s Kyoto University and Leonard Perlovsky of Harvard University.  Their findings help make the case that music, sometimes thought of as a pleasant byproduct of evolution, has in fact played an active role in human development.”

Photos of the Day –June 28th, 2013

Dories built at Lowell’s Boat Shop (in background) bob on the Merrimack River in Amesbury, Mass. Lowell’s is the oldest continuously operating boat shop in the country and has been cited as the birthplace of the fishing dory. Melanie Stetson Freeman/Staff

Brushes hang in front of a paint-splattered wall in the paint shop. Melanie Stetson Freeman/Staff

Market Closes for June 28^th, 2013

Market  Index	Close	Change
Dow  Jones	14909.60	-114.89    -0.76%
S&P 500	1606.28	-6.92    -0.43%
NASDAQ	3403.247	+1.384    +0.04%
TSX	12129.11	+123.33
		+1.03%

International Markets

Market  Index	Close	Change
NIKKEI	13677.32	+463.77
		+3.51%
HANG  SENG	20803.29	+363.21
		+1.78%
SENSEX	19395.81	+519.86
		+2.75%
FTSE 100	6215.47	-27.93
		-0.45%

Bonds

Bonds	% Yield	Previous % Yield
CND.  10 Year Bond	2.439	2.414
CND.   30 Year Bond	2.896	2.893
U.S.   10 Year Bond	2.4857	2.4721
U.S.   30 Year Bond	3.4994	3.5344

Currencies

BOC Close	Today	Previous
Canadian $	0.95097	0.95439
US   $	1.05156	1.04779
Euro Rate  1 Euro=		Inverse
Canadian   $	1.36808	0.73095
US  $	1.30100	0.76864

Commodities

Gold	Close	Previous
London Gold   Fix	1234.57	1200.82
Oil	Close	Previous
WTI Crude Future	96.56	97.05
BRENT	102.30	102.61

Market Commentary:

Canada

By Eric Lam

June 28 (Bloomberg) — Canadian stocks rose for a second day, snapping a streak of four losing weeks, as phone companies rallied after a BCE Inc. deal got regulatory approval and materials producers surged on higher metals prices.

BCE, Canada’s largest telephone company, rose 2.8 percent after regulators accepted its bid to acquire Astral Media Inc. for C$3 billion. Astral, a Quebec broadcaster, gained 3.6 percent. Yamana Gold Inc. added 9.3 percent as the precious metal rebounded from a 34-month low. BlackBerry plunged 27 percent after reporting a first-quarter loss and weaker-than estimated sales of its BB10 smartphones.

The Standard & Poor’s/TSX Composite Index rose 123.33 points, or 1 percent, to 12,129.11 at 4 p.m. in Toronto. The gauge gained 1.1 percent for the week and pared its monthly loss to 4.1 percent. The S&P/TSX fell 4.9 percent in the second quarter, the first drop in a year. Trading volume was 26 percent higher than the 30-day average at this time of the day.

“There’s a bounce in the gold sector today which has been decimated, and some stabilization in the telcos, which were knocked hard by the Verizon chatter,” said Bob Decker, fund manager with Aurion Capital Management in Toronto. He helps manage C$6 billion ($5.7 billion) at the firm. “The debate on the timing of quantitative easing tapering is driving things and gold has found a round number it likes. There’s a bit of short covering and bottom fishing today.”

U.S. Federal Reserve officials assured investors yesterday that stimulus efforts would remain in place until economic growth hit the central bank’s targets.

Canada’s economy grew for a fourth straight month in April, rising 0.1 percent, data today showed. The gain marks the longest string of monthly expansions since September 2011, signaling a further revival from a slump in the second half of last year that was led by investment and exports.

Eight of 10 groups in the S&P/TSX advanced today. Phone stocks rallied 2.5 percent, paring the industry’s worst weekly loss in four years. A report that Verizon Communications Inc. had placed a bid for Wind Mobile to enter the Canadian market sent the group tumbling 6 percent on June 26.

BCE gained 2.8 percent to C$43.12 and Astral advanced 3.6 percent to C$49.96. The Canadian Radio-television and Telecommunications Commission approved a union between the two media companies yesterday, as long as BCE agrees to conditions including investing C$247 million in programming and not withholding content from competitors.

Telus jumped 3 percent to C$30.71 after dropping 11 percent in the previous two sessions. Rogers Communications Inc., Canada’s largest wireless carrier, rose 2.1 percent to C$41.20.

Shaw Communications Inc. climbed 5.6 percent to C$25.24 after reporting third-quarter sales that topped analysts’ estimates. The company also raised its year-end forecast for cash flow.

Materials producers rallied 4.7 percent, the biggest gain since April. The S&P/TSX Gold Index surged 8.9 percent, the most since 2009, as all 25 stocks advanced. The gold gauge rose 0.3 percent this week, snapping three weeks of losses.

China Gold International Resources Corp. jumped 12 percent to C$2.80 and Yamana Gold surged 9.3 percent to C$10.03. The price of gold rebounded from a 34-month low.

First Quantum Minerals Ltd. added 2.3 percent to C$15.60 as the price of copper rose as much as 1 percent before closing 0.1 percent lower in New York. Fortuna Silver Mines Inc. jumped 19 percent as silver prices jumped.

BlackBerry, formerly known as Research In Motion Ltd., sank 27 percent to C$11.03, the biggest loss since December. The company shipped 6.8 million smartphones last quarter, including about 2.7 million BlackBerry 10 models. Analysts had estimated total shipments of 7.5 million, with 3.6 million BlackBerry 10 units.

Technology stocks, which include BlackBerry, slumped 7.8 percent, the most in 21 months.

US

By Nikolaj Gammeltoft

June 28 (Bloomberg) — U.S. stocks fell, with the Standard & Poor’s 500 Index snapping a streak of seven monthly gains, as comments from Federal Reserve Governor Jeremy Stein spurred concern the central bank may begin to reduce stimulus in September.

Accenture Plc, the world’s second-largest technology- consulting company, slumped 10 percent after its quarterly sales forecast missed analysts’ estimates. International Business Machines Corp. lost 2.3 percent for the biggest retreat in the Dow Jones Industrial Average. BlackBerry, the Canadian smartphone maker, fell the most in 12 years after reporting a surprise quarterly loss.

The S&P 500 fell 0.4 percent to 1,606.28 at 4 p.m. in New York. The index extended today’s decline into the close of trading as investors adjusted positions at end of the quarter.

The Dow lost 114.89 points, or 0.8 percent, to 14,909.60 today.

About 10.1 billion shares changed hands on U.S. exchanges, 53 percent above the three-month average.

“People are hearing all these various Fed governors speak and the message they’re trying to send isn’t necessarily any clearer than what was talked about by Bernanke last week,” Robert Pavlik, chief market strategist at Banyan Partners LLC, said by phone. His firm manages about $1.4 billion. “I didn’t really seen a reason to step up to be a buyer on the pullback we had and I didn’t see a lot of follow through at least on the institutional level.”

The S&P 500 yesterday capped the biggest three-day rally since early January on better-than-estimated economic data and assurances on stimulus efforts from Fed officials. Stein said today the central bank is providing more clarity about how it will wind down its $85 billion in monthly bond buying as unemployment falls toward 7 percent.

If the Fed makes a decision to begin reducing purchases in September, Stein said in New York, “it will give primary weight to the large stock of news that has accumulated since the inception of the program and will not be unduly influenced by whatever data releases arrive in the few weeks before the meeting.”

Fed Reserve Bank of Richmond President Jeffrey Lacker, who dissented against additional stimulus at every Fed meeting last year, said financial markets will remain volatile as policy makers debate how and when to curtail the central bank’s asset purchases program.

The Chicago Board Options Exchange Volatility Index, the measure of options on the S&P 500 known as the VIX, has climbed 49 percent since hitting a six-year low in March. The gauge was unchanged at 16.86 today.

The S&P 500 has rallied 13 percent so far this year, the best performance since a 17 percent gain in the first six months of 1998. It has dropped 3.8 percent since May 21 as Fed Chairman Ben S. Bernanke signaled the central bank could taper quantitative easing as the economy improves. The gauge slid 1.5 percent in June, its first monthly decline since October.

Business activity in the U.S. cooled more than projected in June, a regional report showed. The MNI Chicago Report’s business barometer dropped to 51.6 from 58.7 in May, which was the highest in more than a year. A reading of 50 is the dividing line between expansion and contraction. The median forecast of 55 economists surveyed by Bloomberg was 55.

Consumer sentiment fell less than forecast in June from an almost six-year high a month earlier. The Thomson Reuters/University of Michigan said its final index of confidence eased to 84.1 this month from 84.5 at the end of May, which was the highest since July 2007. The median forecast in a Bloomberg survey of economists called for 83 in the gauge after a preliminary reading of 82.7.

“I’m not surprised to see some pullback from three days of strength,” Michael James, a managing director of equity trading at Wedbush Securities Inc. in Los Angeles, said in an interview.

“But bulls are still not willing to let things come in too much with the end of quarter today. Only thing we can count on for the rest of today and next week is continued trader-driven volatility, in both directions.”

U.S. stock trading accelerated into the close, with about 3.8 billion shares, or 38 percent of today’s total, changing hands after 3:59 p.m. Trading volume averaged about 7.1 billion shares this month, the busiest since November 2011, according to data compiled by Bloomberg.

The volume figure got a boost today as Russell Investments concluded the annual revisions to its equity benchmark gauges.

Russell’s annual revisions usually spur one of the busiest sessions of the year. Today’s total was the second highest in 2013 after 10.8 billion shares changed hands June 21, an options expiration day. Last year’s reconstitution on June 22 helped fuel a jump in volume to 9.73 billion shares, the highest total of the year.

Russell’s global stock indexes, including the Russell 1000 Index and the Russell 2000 Index, are used as benchmarks for $4.1 trillion in assets, according to the company’s website. In three of the previous four years, the reconstitution day ranked in the top 20 busiest trading sessions, data compiled by Bloomberg show.

Health-care shares and phone companies fell the most today, losing more than 0.7 percent, as eight of 10 industries retreated. Energy stocks and companies that rely on consumer discretionary spending gained, adding at least 0.4 percent.

Accenture tumbled 10 percent to $71.96 after saying fiscal fourth-quarter revenue will be $6.7 billion to $7 billion. That fell short of the $7.36 billion average estimate of analysts, according to data compiled by Bloomberg. IBM, the world’s largest seller of computer services, fell 2.3 percent to $191.11.

BlackBerry fell 28 percent to $10.46, the biggest decline since April 2000. The company reported a quarterly loss and lower-than-projected sales, hurt by sluggish demand and currency restrictions in Venezuela. The loss in the three months through June 1 was 13 cents a share, excluding some items. Analysts had estimated a profit of 8 cents on average, according to data compiled by Bloomberg.

Molycorp Inc., a producer of rare-earth minerals, jumped 11 percent to $6.20. The company said the U.S. Securities and Exchange Commission recommended no enforcement action be taken after completing an investigation into Molycorp’s public disclosures.

 

Have a wonderful weekend everyone.

 

Be magnificent!

 

We would be happy to do the millions of things that we are not able to do.

The will is there, but we are not able to fulfill our desire.  Thus when we feel a desire,

but we are unable to realize that desire, we undergo a reaction we call suffering.

What is the cause of desire?  I am, only me.

As a result, I myself am the cause of all of the suffering that I have known.

Swami Vivekananda, 1863-1902

As ever,

 

Carolann

 

Attitude determines the altitude of life.

-Edwin Louis Cole, 1922-2002

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 1859, the song “Happy Birthday to You”  was composed.

Helen Keller was born on June 27^th, 1880.

The world is full of suffering but it is also full of people overcoming it. –Helen Keller, 1880-1968.

I read an interesting article in the Wall Street Journal today entitled How Woody Allen Sees It.  It is amazing that as he approaches 80 years old, he shows no signs of slowing down.  His next film, Blue Jasmine, starring Cate Blanchett and Alec Baldwin is due to be released next month.  This will be his 48^th feature film!  I have always been a big fan of his movies – ever since Annie Hall.  Of his  recent ones, I loved Midnight in Paris and Vicky Cristina Bacelona.  Amazingly, he still rehearses  with his jazz ensemble most Thursdays and every Monday night he plays clarinet at the Carlyle Hotel in New York. I saw him there a few times – he really is a pretty good musician. And he frequently writes pieces for The New Yorker magazine, which whenever I see one, I immediately turn to it, because they are invariably funny and insightful.  Right now, according to the article, he’s also working with the theater director Susan Stroman on a Broadway musical version of his 1994 film Bullets Over Broadway, and he just finished acting in another movie written and directed by John Turtorro.

In the article, Allen ventured this explanation about his restlessness, “You know in a mental institution they sometimes give a person some clay or some basket weaving?  It’s the therapy of moviemaking that has been good in my life.  If you don’t work, it’s unhealthy – for me, particularly unhealthy.  I could sit here suffering from morbid introspection, ruing my mortality, being anxious.  But it’s very therapeutic to get up and think, Can I get this actor; does my third act work?  All these solvable problems that are delightful puzzles, as opposed to the great puzzles of life that are unsolvable, or that have very bad solutions.  So I get pleasure from doing this.  It’s my version of basket weaving.”

Most of the important things in the world have been accomplished by people who have kept on trying when there seemed to be no hope at all. –Dale Carnegie, 1888-1955.

Photos of the Day –June 27th, 2013

Tristan Robertson Jeyes (l.) drives a $383 pink Cadillac next to Jayla Silva on a $244 mini dodgem in Hamleys toy store during the Christmas in June media event in London. Paul Hackett/Reuters

People line the streets to cheer the passing motorcade of first lady Michelle Obama as she travels to visit the all-girls Martin Luther King Middle School in Dakar, Senegal. Carolyn Kaster/AP

Market Closes for June 27^th, 2013

Market  Index	Close	Change
Dow  Jones	15024.49	+114.35    +0.77%
S&P 500	1613.20	+9.94    +0.62%
NASDAQ	3401.863	+25.640    +0.76%
TSX	12005.78	+53.88
		+0.45%

International Markets

Market  Index	Close	Change
NIKKEI	13213.55	+379.54
		+2.96%
HANG  SENG	20440.08	+101.53
		+0.50%
SENSEX	18875.95	+323.83
		+1.75%
FTSE 100	6243.40	+77.92
		+1.26%

Bonds

Bonds	% Yield	Previous % Yield
CND.  10 Year Bond	2.414	2.502
CND.   30 Year Bond	2.893	2.957
U.S.   10 Year Bond	2.4721	2.5390
U.S.   30 Year Bond	3.5344	3.5800

Currencies

BOC Close	Today	Previous
Canadian $	0.95439	0.95490
US   $	1.04779	1.04723
Euro Rate  1 Euro=		Inverse
Canadian   $	1.36586	0.73214
US  $	1.30355	0.76711

Commodities

Gold	Close	Previous
London Gold   Fix	1200.82	1226.10
Oil	Close	Previous
WTI Crude Future	97.05	95.50
BRENT	102.61	101.85

Market Commentary:

Canada

By Eric Lam

June 27 (Bloomberg) — Canadian stocks rose as higher crude and copper prices bolstered commodities producers and utilities shares rallied after TransAlta Corp. agreed to split off its renewable power facilities.

Aimia Inc. soared 11 percent after agreeing to a conditional deal for Toronto-Dominion Bank to be its primary credit card partner. First Quantum Minerals Ltd. gained 4.1 percent as copper advanced. Enerplus Corp. jumped 3.2 percent after crude prices rallied to a one-week high. TransAlta surged the most in nearly five years after saying it will raise as much as C$250 million ($238 million) by selling a stake in a new renewable power-generating unit.

The Standard & Poor’s/TSX Composite Index rose 53.88 points, or 0.5 percent, to 12,005.78 at 4 p.m. in Toronto. The benchmark Canadian equity gauge has lost 5.1 percent this month, erasing its gain for 2013, and is headed for the first quarterly loss in a year. Trading volume was 2.2 percent lower than the 30-day average.

“We’re in a slow-growth period but the direction is still up, and I don’t see any major elements to disrupt this market,” said David Cockfield, fund manager with Northland Wealth Management in Toronto. He helps manage C$225 million ($215 million) with the firm. “In the U.S. economy there’s lots of pent-up demand and it looks like the consumer is out there spending.”

U.S. consumer spending rebounded in May, rising 0.3 percent after a 0.3 percent decline in April, which was the most in more than three years. The U.S. is Canada’s largest trading partner.

A semi-annual measure of exporter confidence in Canada rose to 72.6 from 70.7, according to a report from Export Development Canada, suggesting companies are less pessimistic about U.S. and European demand.

Eight of 10 groups in the S&P/TSX advanced today, paced by a 2.2 percent gain among utilities stocks.

TransAlta surged 10 percent to C$14.36, the biggest increase since October 2008. The electric generation and marketing company expects to raise C$200 million to C$250 million by selling a 15 to 20 percent stake in a new company that will house its wind and hydro power-generation assets.

Aimia, which operates the Aeroplan loyalty program, surged 11 percent to C$15.40, for the biggest gain since July 2009, after announcing the tentative deal with TD Bank. The company had been negotiating with Canadian Imperial Bank of Commerce, its existing credit-card partner, to extend a 22-year partnership that expires at the end of the year.

CIBC, which has the right to match the terms of the agreement by Aug. 9, added 0.4 percent to C$75.31. TD Bank climbed 0.6 percent to C$83.90.

Raw-materials producers rose 1 percent, with 43 of 55 stocks advancing. The group has plunged 18 percent in June, headed for the biggest slump since October 2008.

Teck Resources Ltd., Canada’s largest diversified miner, rose 2.2 percent to C$22.24 and First Quantum Minerals added 4.1 percent to C$15.25 as copper advanced 0.2 percent a pound in New York. Nickel prices in London rose from a four-year low to lead a rebound in base metals. Zinc and lead also gained.

B2Gold Corp. slid 3.9 percent to C$1.95 after the price of the precious metal fell below $1,200 to extend its slump to a 34-month low.

Enerplus increased 3.2 percent to C$15.34 and Bankers Petroleum Ltd. added 2 percent to C$2.61. Crude for August delivery rallied 1.6 percent to settle at $97.05 a barrel in New York, the highest since June 19.

Niko Resources Ltd. surged 23 percent to C$9.25, after the company said press reports in India indicate the government has approved a new pricing formula for domestic gas sales in the country. Upon expiry of current contracts next year, gas prices from the D6 block Niko is developing off the east coast of India will double, the company said.

Whitecap Resources Inc. climbed 2.5 percent to C$10.49 after agreeing to buy energy assets in Alberta from Barrick Gold Corp. for C$173.6 million. The light-oil assets produce 2,900 barrels of oil equivalent a day. The company is also raising its dividend by 5 percent to 5.25 Canadian cents a share, beginning with the October payment.

US

By Nikolaj Gammeltoft and Katie Brennan

June 27 (Bloomberg) — U.S. stocks rose, sending the Standard & Poor’s 500 Index to its biggest three-day rally since January, on better-than-estimated economic data and assurances on stimulus efforts from Federal Reserve officials.

Nine of 10 industries in the S&P 500 advanced. JPMorgan Chase & Co. and Citigroup Inc. gained more than 1.2 percent as financial companies rallied. An S&P index that tracks homebuilders surged 2.9 percent as D.R. Horton Inc. and Lennar Corp. increased at least 3.8 percent. Time Warner Cable Inc. jumped 4.4 percent as billionaire John Malone was said to be exploring scenarios for how Charter Communications Inc. could acquire the company.

The S&P 500 advanced 0.6 percent to 1,613.20 at 4 p.m. in New York. The Dow Jones Industrial Average rose 114.35 points, or 0.8 percent, to 15,024.49. Almost 6.2 billion shares changed hands on U.S. exchanges, 4.4 percent below the three-month average.

“The data continues to show that the economy is growing at a very slow pace and that unemployment is improving at a very slow pace,” Oliver Pursche, co-manager of the GMG Defensive Beta Fund and president of Suffern, New York-based Gary Goldberg Financial Services, said in a phone interview. The firm manages about $650 million. “It means the likelihood that the Federal Reserve changing course on its monetary policy this year is very low, and that further solidifies the case that last week’s correction was emotionally driven and an overreaction.”

The S&P 500 has rallied 2.6 percent over the past three days, the most since Jan. 4 and paring its decline for June to 1.1 percent. The index dropped more than 5 percent from May 21 through June 24 as the Fed said it may reduce its bond purchases if the economy and labor market improve as forecast.

Central bank stimulus has helped fuel a rally in stocks worldwide, with the benchmark U.S. index surging as much as 147 percent from its March 2009 low. Despite this month’s decline, the S&P 500 is up 2.8 percent for the quarter and has soared 13 percent for 2013.

Consumer spending in the U.S. rebounded in May following the largest drop in more than three years. Household purchases, which account for about 70 percent of the economy, rose 0.3 percent after a 0.3 percent decline the prior month, Commerce Department figures showed today in Washington. Incomes advanced 0.5 percent, more than projected.

More Americans signed contracts in May to buy previously owned homes than at any time in more than six years. Claims for unemployment benefits decreased by 9,000 to 346,000 last week, indicating employers are slowing the pace of firings.

Fed Bank of New York President William C. Dudley said in New York today that the central bank may prolong its asset- purchase program if the economy’s performance fails to meet its forecasts. Fed Governor Jerome Powell said in Washington that asset purchases may be scaled back later this year if growth holds up, and any such trimming depends on economic data rather than the calendar.

The comments came a day after Fed Bank of Richmond President Jeffrey Lacker said he expects the U.S. expansion to remain “sluggish” for “a couple more years.”

Data yesterday showed gross domestic product expanded at a slower-than-forecast 1.8 percent annualized rate in the first quarter, fueling speculation the Fed will maintain the pace of quantitative easing.

The Chicago Board Options Exchange Volatility Index, or VIX, retreated 2 percent to 16.86. The benchmark gauge for U.S. stock options surged to the highest level since Dec. 28 last week. The index has fallen 11 percent this week.

Financial and phone companies advanced more than 0.9 percent to lead gains among S&P 500 industries. The Morgan Stanley Cyclical Index of stocks whose earnings are most tied to economic growth increased 1.1 percent. Hewlett-Packard Co. climbed 3.2 percent to $24.77. Boeing Co., the world’s largest planemaker, rallied 2.4 percent to $103.15.

An S&P index of homebuilders jumped 2.9 percent for a third day of gains, as 10 of 11 members advanced following the report on existing-home sales. D.R. Horton jumped 3.8 percent to $21.71. Lennar surged 3.8 percent to $37.38.

Financial stocks jumped 1.3 percent as a group. JPMorgan climbed 1.2 percent to $53.15. Citigroup added 1.4 percent to $48.28. American Express Co. rose 1.7 percent to $75.12.

Time Warner Cable surged 4.4 percent to $108.22. Malone’s Liberty Media Corp., which owns 27 percent of Charter Communications, is working on how to structure an offer with enough cash to win over Time Warner Cable investors, according to people familiar with the discussions. Time Warner Cable isn’t interested in a deal and doesn’t think Liberty and Charter can come up with an offer that’s attractive, according to people familiar with management’s thinking.

ConAgra Foods Inc. added 5.1 percent to $35.04. The maker of Chef Boyardee pasta and Pam cooking spray reported quarterly profit that topped analysts estimates as acquisitions drove sales in its consumer foods unit.

Paychex Inc. dropped 3.7 percent to $36.60. The payrolls manager reported fourth-quarter earnings per share of 34 cents, below the average analyst estimate for profit of 37 cents.

Revenue in the period was $585.3 million, missing the $586.2 million average projection.

Investors should expect about $13 billion in selling of equities and buying of bonds as pension fund managers rebalance their portfolios at the end of the second quarter, Ramon Verastegui, a derivatives strategist at Societe Generale SA in New York, wrote in a June 25 note.

The S&P 500 has outperformed government bonds since the end of March with a total return of 2.7 percent through yesterday compared with a 5.1 percent loss for 10-year Treasuries, according to data compiled by Bloomberg and Bank of America Merrill Lynch.

U.S.-listed bond mutual funds and exchange-traded funds saw record monthly redemptions of $61.7 billion through June 24, according to TrimTabs Investment Research, amid concern the Fed may scale back its unprecedented stimulus. Mutual funds that invest in U.S. stocks had $463 million in outflows in the five days that ended with the Fed’s policy statement on June 19, according to data from the Investment Company Institute released today. Redemptions since May 16 total $7.3 billion.

“The flows coming out of fixed income need to go somewhere,” Bill Schultz, chief investment officer who oversees about $1.1 billion at McQueen Ball & Associates in Bethlehem, Pennsylvania, said by phone. “Money market funds don’t offer anything, bonds are less attractive, so U.S. domestic equities on a relative scale look like the most attractive asset going forward.”

 

Have a wonderful evening everyone.

 

Be magnificent!

 

We must always bear in mind

that we are not going to be free,

but are free already.

Every idea that we are bound is a delusion.

Every idea that we are happy or unhappy

is a tremendous delusion.

Swami Vivekananda, 1863-1902

As ever,

 

Carolann

 

Cock your hat – angles are attitudes.

-Frank Sinatra, 1915-1998

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