Author: Carolann

Dear Friends,

Tangents:

December 17-23 known as Saturnalia: Roman masters served their slaves.  Saturnus is one of the most puzzling gods in Roman cult.  His festival was part of the Calendar of Numa, and its position on December 17^th, midway between Consualia and Opalia, is intelligible if we suppose, as has commonly been done, that his name Säturnus is to be connected with sätus and taken as that of a god of sowing, or of seed-corn.  Other historians derive the god from the Etruscan Satre.  There is little known of the cult of Saturn.

On this day in 1843, Charles Dicken’s A Christmas Carol was first published.  –Paul Vigna, WSJ, 12/17/12.

And also on this day in…

1777 – France recognized American independence.

1790 – Aztec calendar stone is discovered.

1903 – Orville and Wilbur Wright made the first flight in a heavier-than-air plane at Kitty Hawk, N.C.

1944 – The U.S. Army announced the end of its policy of holding Japanese-Americans in internment camps, allowing “evacuees” to return home.

1948 – The Smithsonian Institution accepts the Kitty Hawk – the Wright brothers’ plane, 45 years after its historical first flight.

1969 – The U.S. Air Force ended its “Project Blue Book” and concluded that there was no evidence of extraterrestrial activity behind UFO sightings.

1992 – Canadian PM Brian Mulroney signs historical North American Free Trade Accord (NAFTA) between the U.S., Mexico and Canada, at a ceremony on Parliament Hill.

 

A single day  is enough to make us a little larger.  –Paul Klee

photos of the day

December 17, 2012

Ski instructor Alberto Ronchi, dressed in a Santa Claus costume, takes a ski jump in Madonna di Campiglio in northern Italy.

Stefano Rellandini/Reuters

A herd of adult and baby elephants walks in the dawn light through Amboseli National Park in southern Kenya. Mount Kilimanjaro, the highest mountain in Africa, which is in neighboring Tanzania, is seen in the background.

Ben Curtis/AP

 

Market Closes for December 17th, 2012:

 

Market  Index	Close	Change
Dow  Jones	13235.39	+100.38    +0.76%
S&P 500	1427.50	+13.92    +0.98%
NASDAQ	3010.604	+39.269    +1.32%
TSX	12267.15	-29.57
		-0.24%

International Markets

Market  Index	Close	Change
NIKKEI	9828.88	+91.32
		+0.94%
HANG  SENG	22513.61	-92.37
		-0.41%
SENSEX	19244.42	-72.83
		-0.38%
FTSE 100	5912.15	-9.61
		-0.16%

Bonds

Bonds	% Yield	Previous % Yield
CND.  10 Year Bond	1.827	1.790
CND.   30 Year Bond	2.405	2.381
U.S.   10 Year Bond	1.7682	1.7015
U.S.   30 Year Bond	2.9417	2.8640

Currencies

BOC Close	Today	Previous
Canadian $	0.98395	0.98580
US   $	1.01631	1.01440
Euro Rate  1 Euro=		Inverse
Canadian   $	1.29520	0.77208
US  $	1.31633	0.75969

Commodities

Gold	Close	Previous
London Gold   Fix	1697.90	1696.10
Oil	Close	Previous
WTI Crude Future	87.20	86.73
BRENT	111.50	111.99

Market Commentary:

Canada

By Eric Lam

Dec. 17 (Bloomberg) — Canadian stocks fell as raw materials companies declined after manufacturing slumped more than forecast in the New York region, showing weakness in the industry is persisting as the year draws to a close.

First Quantum Minerals Ltd., a producer of copper in Africa, dropped 4 percent after it raised its bid for Inmet Mining Corp. to C$5.1 billion ($5.17 billion). Inmet rose 4.3 percent. First Majestic Silver Corp. plunged 10 percent after it announced a deal to acquire Orko Silver Corp. yesterday. Sun Life Financial Inc. slipped 3.9 percent after the insurer agreed to sell a U.S. annuity business to a firm owned by Guggenheim Partners LLC in a $1.35 billion deal.

The Standard & Poor’s/TSX Composite Index fell 15.37 points, or 0.1 percent, to 12,281.35 at 4 p.m. in Toronto. The equity gauge has gained 2.7 percent this year.

“Commodities are pretty flat today,” said Paul Harris, fund manager with Avenue Investment Management in Toronto. His firm manages about C$300 million. “Gold doesn’t look as great on the charts; it could go to $2,000 but people are feeling it will go lower short-term before it goes higher. Gold went from $1,500 in June to $1,800 and now it’s pulled back.”

The price of gold has fallen more than 5 percent since reaching a second-half high of $1,798.60 in October. Gold for February delivery gained 0.1 percent to settle at $1,698.20 an ounce in New York.

Yamana Gold Inc. lost 1.9 percent to C$16.90 and Goldcorp Inc., the second-largest producer of the metal, dropped 0.4 percent to C$36.33.

A Federal Reserve gauge of manufacturing in the New York region shrank more than forecast to minus 8.1 in December. The median forecast of 55 economists in a Bloomberg survey called for minus 1. Readings of less than zero indicate contraction.

Mining and bank stocks contributed most to losses in the S&P/TSX. Trading volume was 28 percent higher than the 30-day average at this time of the day.

First Majestic plunged 10 percent to C$20.29 after it announced a plan to acquire Orko for about C$387 million. As part of the deal, First Majestic will issue 17.1 million common shares. Orko, which is developing a silver project in Mexico, surged 51 percent to C$2.39.

Silvercorp Metals Inc. retreated 7.7 percent to C$5.18 and Fortuna Silver Mines Inc. sank 5.5 percent to C$4.26.

First Quantum fell 4 percent to C$20.11 after raising its bid for Inmet a second time. The company is now offering C$72 in stock and cash for each Inmet share. The bid is 2.9 percent more than the previous offer of C$70 a share.

Inmet, which is developing the Cobre Panama copper project in Panama, climbed 4.3 percent to C$72.85, suggesting investors are speculating other suitors will bid for the company.

HudBay Minerals Inc. lost 3 percent to C$10.37. Copper for March delivery slipped 0.5 percent to settle at $3.666 a pound, as inventories tracked by the London Metal Exchange jumped the most in more than four years.

Sun Life Financial Inc., Canada’s third-largest insurer, lost 3.9 percent to C$26.74. Sun Life expects the sale of the U.S. annuity business to reduce earnings by about 22 cents a share in 2013.

US

By Lu Wang and Rita Nazareth

Dec. 17 (Bloomberg) — U.S. stocks rose, giving the Standard & Poor’s 500 Index its biggest gain in about a month, as investors weighed prospects for a budget deal in Washington.

All 10 groups in the S&P 500 rose as financial companies gained the most, adding 2.1 percent. American International Group Inc. climbed 3 percent on plans to sell as much as $6.5 billion of AIA Group Ltd. shares. Hartford Financial Services Group Inc. jumped 3.6 percent as Sun Life Financial Inc.’s deal to sell a U.S. annuity unit raised the prospect for the insurer seeking to sell a similar business. Tenet Healthcare Corp. rose 1.8 percent as Deutsche Bank AG upgraded the hospital chain.

The S&P 500 added 1.2 percent to 1,430.36 at 4 p.m. in New York. The measure capped its biggest gain since Nov. 23. The Dow Jones Industrial Average rose 100.38 points, or 0.8 percent, to 13,235.39. About 6.3 billion shares changed hands on U.S. exchanges, 2.3 percent above the three-month average.

“It’s a historic tug of war: pulling on one side is the fiscal cliff, pulling the other side is continued global monetary easing,” David Sowerby, a portfolio manager at Boston- based Loomis Sayles & Co., said in a telephone interview. His firm oversees about $175 billion. “The most positive thing for the market is valuation and an accommodative Fed policy.”

The equity benchmark has lost 0.7 percent so far this quarter as President Barack Obama and House Republicans differed over how to avoid automatic deficit-reduction measures. The Federal Reserve said last week that it will buy $45 billion a month of Treasury securities starting in January to help boost growth, in addition to $40 billion a month of mortgage-debt purchases under a previous plan.

The S&P 500 is trading at 14.6 times reported earnings, compared with the average of 16.4 since 1954, data compiled by Bloomberg show. The benchmark is up 14 percent this year.

Obama and House Speaker John Boehner met for about 45 minutes at the White House today with two weeks remaining to avert more than $600 billion in spending cuts and tax increases set to start in January. The Congressional Budget Office has said a failure to avoid the so-called fiscal cliff may lead to a recession in the first half of 2013.

Obama is considering a possible budget concession on Social Security cost-of-living increases after Boehner dropped his opposition to raising tax rates for some top earners, said two people familiar with the talks. Senate Majority Leader Harry Reid, a Nevada Democrat, said today it appears the chamber will need to reconvene Dec. 26 to work on the budget.

Manufacturing in the New York region shrank more than forecast in December, showing weakness in the industry is persisting as the year draws to a close.

In Japan, the Nikkei 225 Stock Average rose to the highest in eight months after the Liberal Democratic Party returned to power on a campaign for more economic stimulus and the doubling of the nation’s inflation goal.

AIG climbed 3 percent to $34.95. The insurer plans to sell out of AIA Group, exiting the business from which it was formed in Shanghai in 1919. AIG is selling about 1.65 billion shares in Hong Kong-headquartered AIA at HK$29.65 to HK$30.65 each, according to a term sheet obtained by Bloomberg News.

Hartford advanced 3.6 percent to $22.05. Sun Life struck a deal to sell its U.S. annuity business to a firm owned by Guggenheim Partners LLC shareholders for $1.35 billion.

The Guggenheim deal shows “there are potential buyers out there for these troubled books of business, which could open up opportunities for Hartford,” said Randy Binner, an analyst at FBR Capital Markets, in a note to investors today.

Tenet climbed 1.8 percent to $31.18. The hospital chain was raised to buy from hold by Deutsche Bank, which said the company’s 2013 growth will “stand out.”

Compuware Corp. surged 13 percent to $10.76. Elliott Management Corp., which owns 8 percent of the software maker, offered to acquire the company for $2.3 billion, or $11 a share.

An index of homebuilders rallied 4.5 percent, the most since Oct. 3, as all its 11 members gained. A Wells Fargo & Co. monthly survey of homebuilding sales managers showed that 1 percent of respondents lowered prices in November, the fewest in seven years. Lennar Corp. climbed 4 percent to $38.80. D.R. Horton Inc. added 5.1 percent to $19.69 while PulteGroup Inc. gained 5.3 percent to $18.04.

Smith & Wesson Holding Corp. led a decline in stocks of firearms makers amid talks about gun control following last week’s elementary school shooting that left 20 children dead.

Smith & Wesson dropped 5.2 percent to $8.66, after a 4.3 percent loss on Dec. 14. Sturm Ruger & Co. slipped 3.5 percent to $44.

J.C. Penney Co. fell 1.6 percent to $20.64, ending a seven- day, 20 percent gain. The department-store company is “resuming a more aggressive promotional stance” to boost store traffic, said Brian Nagel, an analyst with Oppenheimer & Co. While the strategy may help strengthen its cash holdings, the recent stock rebound might not prove sustainable, Nagel said in a note today.

Clearwire Corp. slumped 14 percent to $2.91. The company’s board agreed to a sweetened, $2.97-a-share takeover bid from its wireless partner Sprint Nextel Corp., which is now offering $2.2 billion to acquire the portion of Clearwire it doesn’t already own. Shares of money-losing Clearwire jumped above $3 last week after Sprint made an initial $2.90-a-share offer, a sign that investors were anticipating a higher bid.

The U.S. budget debate is holding stocks hostage, as chief executive officers prepare to cut capital spending for the first time since 2009 should President Obama and Congress fail to reach an accord.

Expenditures by S&P 500 companies will fall 1.3 percent in 2013 after three years of growth, according to more than 10,000 analyst estimates compiled by Bloomberg. Companies from Verizon Communications Inc. to Rockwell Collins Inc. said they don’t plan to boost investment amid concern political leaders will fail to agree on a plan to avert the fiscal cliff.

Bears say CEO pessimism will sap the rally and note that the last time capital spending declined was at the end of 2008, just before stocks slumped to a 12-year low. Bulls point out that estimates for corporate spending show any decline will be limited and say the improving U.S. economy will lift equity valuations, now 12 percent below the 58-year average, Bloomberg data show.

“In an environment where the economic and political outlook is highly uncertain, it is hard for executives to make investment decisions,” Abi Oladimeji, who helps oversee $4.3 billion as head of investment strategy at Thomas Miller Investment Ltd. in London, said in a telephone interview on Dec. 12. “The danger is that we see policy errors, which could undermine equity markets and the broader economy.”

Have a wonderful evening everyone.

 

Be magnificent!

 

We do not progress from error to truth, but from truth to truth.

Thus we must see that none can be blamed for what they are doing, because they are,

at this time, doing the best they can.  We learn only from experience.

Swami Vivekananda, 1863-1902

As ever,

 

Carolann

 

The truth is always the strongest argument.

-Sophocles, 496-406 BC

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 article in the Wall Street Journal this week:

-by Robert Lee Holtz

Researchers on Wednesday said they found the earliest known chemical evidence of cheese-making, based on the analysis of milk-fat residues in pottery dating back about 7,200 years. The discovery suggests Europe’s early farmers added a cheese course to their diet almost as soon as they learned to domesticate cattle and started regularly milking cows.

Mélanie Salque/University of Bristol

A fragment of a sieve that researchers say were used as cheese strainers.

Mélanie Salque/University of Bristol

Another sieve fragment

Scientists led by geochemist Richard Evershed at the U.K.’s University of Bristol tested ancient, perforated clay pots excavated at sites along the Vistula River in Poland, and found they had likely been used by prehistoric cheese mongers as strainers to separate curds and whey—a critical step in making cheese.

The pots have long puzzled archeologists, but their new analysis, reported in Nature, revealed unique carbon isotopes of milk in the traces of fatty acids that had soaked into the ceramic sieves.

“It is a no-brainer,” said Dr. Evershed. “They have to be cheese strainers.”

No one knows exactly when or where cheese-making began, but experts said the traces of milk fat on these unglazed clay strainers are the clearest evidence yet of the origins of this basic biotechnology, which launched a dairy trade that today produces more than 11 billion pounds of cheese every year and as many as 5,000 different named varieties world-wide, from Appenzeller to Zamorano.

Cheese historians suspect that the first cheese was most likely a soft, watery concoction, resembling a contemporary cottage cheese or a fromage frais, that was naturally curdled by the bacteria commonly found on a cow’s teats.

Shards of the distinctive urns, which resemble pottery cheese strainers still in use today, are found often at sites settled by the Neolithic-era tribes who first brought the innovations of agriculture and animal husbandry to central Europe. They almost always turn up in association with large numbers of cattle bones.

In prehistoric times, when almost every adult was lactose-intolerant, the invention of cheese-making offered herders a way to turn fresh whole cow’s milk into a food that they could consume without getting ill, experts said. Cheese contains far less lactose than milk. Moreover, cheese, which normally takes up a tenth of the volume of the milk from which it is made, is easier to store, transport and preserve.

“Making cheese is a particularly efficient way to exploit the nutritional benefits of milk, without becoming ill because of the lactose,” said archeologist Peter Bogucki, an associate dean at Princeton University, who was part of the international research team.

In fact, evolutionary biologists at University College London have suggested that a genetic mutation to better tolerate lactose first originated in central Europe about the time this prehistoric cheese-making began. The inherited ability to digest cow’s milk more easily is widespread today among people of European ancestry.

For decades, archeologists have debated how the vessels pocked with holes were used. Some scholars theorized that the pots were used to brew beer. Others speculated that primeval chefs used them to separate meat from stock or honey from honeycomb. The containers also may have been fire pots to hold glowing embers safely.

“Scholars have been duking it out for decades as to what these sieves were used for,” said University of Vermont cheese chemist Paul Kindstedt, author of “Cheese and Culture: A History of Cheese and Its Place in Western Civilization.” He wasn’t involved in the research. “This new finding is really definitive —beyond a reasonable doubt—that this utensil was used for cheese making.”

On this day in…

1799 – George Washington died at age 67.

1819 – Alabama became the 22nd state in the United States.

1911 – Norwegian explorer Roald Amundsen became the first man to reach the South Pole, beating an expedition led by Robert F. Scott.

1939 – The Soviet Union was dropped from the League of Nations.

1967 – DNA synthesized for the first time.

1981 – Israel formally annexed the Golan Heights.

 
Feel the fear and do it anyway. – Susan Jeffers.

photos of the day

December 14, 2012

The 78.74-foot-tall Christmas tree is lit in St. Peter’s square at the Vatican.

Gregorio Borgia/AP

Winner Lara Gut of Switzerland (l.) and Nadja Kamer of Switzerland, who came in third, celebrate with champagne on the podium after a women’s Alpine Ski World Cup downhill race in Val d’Isere, France.

Jean-Christophe Bott/Keystone/AP

 

Market Closes for December 14th, 2012:

 

Market  Index	Close	Change
Dow  Jones	13135.01	-35.71    -0.27%
S&P 500	1413.58	-5.87    -0.41%
NASDAQ	2971.335	-20.827    -0.70%
TSX	12296.72	+7.55
		+0.06%

International Markets

Market  Index	Close	Change
NIKKEI	9737.56	-5.17
		-0.05%
HANG  SENG	22605.98	+160.40
		+0.71%
SENSEX	19317.25	+87.99
		+0.46%
FTSE 100	5921.76	-7.85
		-0.13%

Bonds

Bonds	% Yield	Previous % Yield
CND.  10 Year Bond	1.790	1.799
CND.   30 Year Bond	2.381	2.399
U.S.   10 Year Bond	1.7015	1.7299
U.S.   30 Year Bond	2.8640	2.9054

Currencies

BOC Close	Today	Previous
Canadian $	0.98580	0.98449
US   $	1.01440	1.01576
Euro Rate  1 Euro=		Inverse
Canadian   $	1.29753	0.77069
US  $	1.31622	0.75975

Commodities

Gold	Close	Previous
London Gold   Fix	1696.10	1696.95
Oil	Close	Previous
WTI Crude Future	86.73	85.89
BRENT	111.99	109.44

Market Commentary:

Canada

By Eric Lam and Whitney Kisling

Dec. 14 (Bloomberg) — Canadian stocks climbed, extending their gain for the week, as optimism about the global economy fueled by American and Chinese manufacturing reports offset a slump in factory sales and concern about U.S. budget talks.

Dundee Corp. surged 14 percent after the company said it will give shareholders a 50 percent stake in Dundee Real Estate Investment Trust, its 70 percent-owned real-estate unit. China Gold International Resources Corp. declined 5.8 percent as the precious metal dropped for a third straight week. Encana Corp. slipped 4.3 percent a day after PetroChina Co. agreed to pay C$1.18 billion ($1.2 billion) for a 49.9 percent stake in an Alberta shale formation.

The Standard & Poor’s/TSX Composite Index rose 7.55 points, or 0.1 percent, to 12,296.72. The equity gauge gained 1.1 percent for the week and is up 2.9 percent this year.

“You’ve got some positive impulses and some negative impulses, so we’re stabilizing and we’ll see more stabilization later,” Robert “Hap” Sneddon, president of Castlemoore Inc. in Oakville, Ontario, said in a phone interview. “We had a little bit of a positive with Harper allowing two sovereign deals to go through in the oils.”

Industrial production in the U.S. rose in November by the most in two years. In China, the December preliminary reading was 50.9 for a purchasing managers’ index released by HSBC Holdings Plc and Markit Economics, beating estimates.

Canadian factory sales fell faster than economists forecast in October on declines in aircraft and automobiles, while inventories reached the highest in almost four years.

President Barack Obama and Republican House Speaker John Boehner remained deadlocked yesterday during their third White House meeting on next year’s budget. Canadian Finance Minister Jim Flaherty said today that Canada would enter a recession if U.S. policy makers are unable to reach an agreement to avoid fiscal tightening scheduled for January.

“There is good reason for concern in the next quarter or so if that issue is not resolved satisfactorily,” Flaherty told reporters today in Ottawa.

Encana fell 4.3 percent to $19.96, after jumping 2 percent yesterday. PetroChina’s deal marks the first between Canada and a state-owned company since Canadian Prime Minister Stephen Harper unveiled new foreign investment rules on Dec. 7.

The rules, announced after the approval of Cnooc Ltd.’s purchase of Nexen Inc., prohibit state-owned enterprises from taking control of Canadian oil-sands businesses unless there are “exceptional circumstances.” Joint ventures and minority stake acquisitions aren’t barred under the rules.

China Gold fell 5.8 percent to C$3.41. Gold futures for February delivery rose 20 cents to settle at $1,697 an ounce in New York. The metal was down 0.5 percent this week.

Dundee rallied 14 percent to C$30.47 after its board approved a tax-efficient plan to give shareholders a 50 percent stake in Dundee Realty Corp.

Inmet Mining Corp., the target of a proposed takeover offer from First Quantum Minerals Ltd., climbed 4.7 percent to C$69.83 after the miner boosted the copper resource estimate at its Cobre Panama project by 27 percent.

US

By Lu Wang

Dec. 14 (Bloomberg) — U.S. stocks had their first weekly decline in a month as budget talks dragged on, overshadowing the Federal Reserve’s plan to expand bond purchases and better-than- estimated economic data.

Consumer companies fell the most among 10 groups in the Standard & Poor’s 500 Index as analysts cut ratings for Family Dollar Stores Inc. and Priceline.com Inc. Apple Inc. sank 4.4 percent after UBS AG and Jefferies & Co. lowered their share- price estimates. Berkshire Hathaway Inc. and DuPont Co. each climbed 2.1 percent amid optimism over share buybacks. An index of steelmakers rallied 7 percent as economic data beat forecasts in China, the world’s biggest buyer of industrial metals.

The S&P 500 fell 0.3 percent to 1,413.58, snapping a three- week gain. The Dow Jones Industrial Average declined 20.12 points, or 0.2 percent, to 13,135.01 for the week.

“The market would love for a fiscal cliff deal to be announced, then it would trend back to really the fundamentals, which are actually looking better,” David Chalupnik, head of equities at Nuveen Asset Management in Minneapolis, said in a phone interview. His firm manages $112 billion. “Time is running out here pretty quickly for certainly a grand bargain type of deal.”

President Barack Obama and Republican House Speaker John Boehner remained deadlocked during their third White House meeting on next year’s budget. More than $600 billion in tax increases and spending cuts are scheduled to start taking effect in January unless Congress acts to avert them.

Government reports showed retail sales and industrial production rebounded in November while jobless claims declined to a nine-week low. The Fed said it will buy $45 billion a month of Treasury securities starting in January to help boost growth, in addition to $40 billion a month of mortgage-debt purchases under a previous plan. Asset buying will continue until the labor market improve “substantially,” the central bank said.

Three rounds of bond purchases from the Fed have helped the S&P 500 more than double from a 12-year low in 2009. While the benchmark gauge is up 12 percent this year, it’s fallen 1.9 percent this quarter, worse than any other developed market among 24 tracked by Bloomberg.

“The fiscal cliff is creating value in equities as there is too much negativity priced in,” said Scott Minerd, chief investment officer of Guggenheim Partners LLC, who oversees more than $125 billion from Santa Monica, California. “I’m of the mindset that the fiscal cliff is a non-event.”

Consumer-discretionary shares in the S&P 500 fell 1.2 percent for the week, the most among 10 industry groups.

Family Dollar slumped 7.2 percent to $65.86 as JPMorgan Chase & Co. reduced its rating for the discount retailer to neutral, an equivalent of hold, from overweight, citing increased competition. Dollar General Corp., the largest U.S. dollar-store chain, said it will match rivals’ price cuts to retain customers that analysts anticipate will spend more cautiously next year. Dollar General lost 6.4 percent to $43.83.

Priceline.com declined 6.9 percent to $613.54. The online travel agency was cut to hold from buy at Deutsche Bank AG on concern competition in the industry may heat up next year.

Apple tumbled 4.4 percent to $509.79. Steven Milunovich, an analyst at UBS, cut his price estimate to $700 from $780, citing concern that growth may slow for the iPhone and iPad. Based on checks with Apple’s suppliers, Milunovich said that the company is starting to curb production of the iPhone. Peter Misek at Jefferies trimmed his forecast to $800 from $900.

Berkshire climbed 2.1 percent to $89.15. The company said it will pay as much as 120 percent of book value, a measure of assets minus liabilities, for stock buybacks, signaling Chief Executive Officer Warren Buffett views the shares as undervalued. The previous limit was 110 percent.

DuPont advanced 2.1 percent to $44.09. The biggest U.S. chemical maker by market value said 2012 earnings will reach the upper end of the company’s forecast and it will spend as much as $1 billion to repurchase shares.

An S&P 500 index of steelmakers rallied 7 percent for the biggest weekly gain since September as data from China showed factory output and retail sales beat economists’ estimates while manufacturing may expand at a faster pace.

U.S. Steel Corp., the country’s largest producer of the metal by volume, jumped 9.6 percent to $23.85. Cliffs Natural Resources Inc., the largest U.S. iron-ore producer, surged 15 percent to $33.96.

TripAdvisor Inc. advanced 8 percent to $41.67. Liberty Interactive Corp. bought about $300 million in shares of the online travel-review company, gaining voting control from billionaire Barry Diller, who stepped down as its chairman.

 

Have a wonderful weekend everyone.

 

Be magnificent!

 

Do not destroy.  Iconoclastic reformers do no good to the world.

Help if you can; if you cannot, fold your hands, stand by, and see things go on.

Therefore say not a word against any man’s convictions, so far as they are sincere.

Secondly, take man where he stands, and from thence give him a lift.

Swami Vivekananda, 1863-1902

As ever,

 

Carolann

 

Everything comes gradually and at

its appointed hour.

-Ovid, 43 BC- 17/18 AD

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:

Of to our holiday season office party tonight.  In that spirit, let me share with you a new piece of music for the season.

There is a specially commission new Christmas carol by Luke Styles, Glyndebourne’s Young Composer in Residence.  It is called When Icicles Hang From The Wall and it is  based on words from Shakespeare’s Love’s Labour’s Lost.  Love’s Labour’s Lost is one of William Shakespeare’s early comedies, believed to have been written in the mid-1590s, and first published in 1598.  You can see the video of the recording at www.ft.com/ftcarol.

The fabulous Sir David Tang is at the ivories!

And on this day in…

1929 – Christopher Plummer was born.

1981 – The Polish government imposed martial law in an attempt to crush the Solidarity movement.

1990 –  GST goes through after a 6-month filibuster.

2000 – Al Gore concedes presidential election.

2003 – American forces captured Saddam Hussein who was hiding in a hole near his hometown of Tikrit.

 
Let us love winter, for it is the spring of genius. –Pietro Aretino.

 

photos of the day

December 13, 2012

A giant Christmas tree stands in the middle of the Galeries Lafayette department store in Paris.

Charles Platiau/Reuters

An ultra-Orthodox Jewish man lights a Hanukkah menorah in Jerusalem’s Mea Shearim neighborhood. The Jewish festival of light is an eight-day commemoration of the Jewish uprising in the second century B.C. against the Greek-Syrian kingdom, which had tried to put statues of Greek gods in the Jewish Temple in Jerusalem.

Ariel Schalit/AP

Market Closes for December 13th, 2012:

 

Market  Index	Close	Change
Dow  Jones	13170.72	-74.73    -0.56%
S&P 500	1419.45	-9.03    -0.63%
NASDAQ	2992.162	-21.653    -0.72%
TSX	12289.17	-63.92
		-0.52%

International Markets

Market  Index	Close	Change
NIKKEI	9742.73	+161.27
		+1.68%
HANG  SENG	22445.58	-57.77
		-0.26%
SENSEX	19229.26	-126.00
		-0.65%
FTSE 100	5929.61	-16.24
		-0.27%

Bonds

Bonds	% Yield	Previous % Yield
CND.  10 Year Bond	1.799	1.759
CND.   30 Year Bond	2.399	2.367
U.S.   10 Year Bond	1.7299	1.6988
U.S.   30 Year Bond	2.9054	2.8918

Currencies

BOC Close	Today	Previous
Canadian $	0.98449	0.98463
US   $	1.01576	1.01561
Euro Rate  1 Euro=		Inverse
Canadian   $	1.28736	0.77678
US  $	1.30765	0.76473

Commodities

Gold	Close	Previous
London Gold   Fix	1696.95	1711.55
Oil	Close	Previous
WTI Crude Future	85.89	86.77
BRENT	109.44	110.82

Market Commentary:

Canada

By Eric Lam

Dec. 13 (Bloomberg) — Canadian stocks fell for the first time in five days as gold and crude retreated, sending commodity stocks lower amid an impasse in U.S. budget talks.

Kirkland Lake Gold Inc. plunged 15 percent after cutting its production guidance. Barrick Gold Corp. and Goldcorp Inc., the two largest producers of the metal, dropped at least 2 percent as gold prices fell the most in a week. Oncolytics Biotech Inc. soared 28 percent after the Calgary-based drug company received positive results from a study on a cancer drug it is developing. Sears Canada Inc. rose 5.8 percent after the retailer declared a special dividend.

The Standard & Poor’s/TSX Composite Index fell 63.92 points, or 0.5 percent, to 12,289.17 in Toronto. The equity gauge has gained 2.8 percent this year.

“We had a bit of a rally the past few weeks for commodity prices, but the companies in those sectors aren’t getting full value for the prices so investors may sell when there’s a bit of profit on the table,” said Kevin Headland, director of the portfolio advisory group with Manulife Asset Management in Toronto. The firm manages about $218 billion. “From a fiscal cliff perspective, a lot of it is rhetoric right now. We expect something will be announced at the last minute.”

Negotiations for a U.S. budget compromise have stalled with House Speaker John Boehner saying President Barack Obama is “unserious about cutting spending.” Obama said the negotiations are “still a work in progress.” Democrats and Republicans remain hundreds of billions of dollars apart as a year-end deadline to avoid more than $600 billion in automatic tax increases and spending cuts approaches.

U.S. Federal Reserve Chairman Ben S. Bernanke warned yesterday fiscal stimulus measures will not be able to offset the impact of those automatic tax increases if government officials are unable to reach a deal. The Fed also lowered its forecast for growth next year, now expecting the economy to expand 2.3 percent to 3 percent, compared with 2.5 percent to 3 percent in September.

Gold mining companies and energy stocks contributed most to losses on the S&P/TSX as seven of 10 industries retreated.

Trading volume was 25 percent higher than the 30-day average.

Kirkland Lake plunged 15 percent to C$6.61 after saying gold sales for the year ending in April will be about 90,000 to 110,000 ounces. The company had previously forecast 180,000 to 200,000 ounces.

Barrick fell 2 percent to C$33.86 and Goldcorp dropped 3.2 percent to C$36.41. Gold for February delivery retreated 1.2 percent to settle at $1,696.80 an ounce in New York, the biggest loss since Dec. 4.

Suncor Energy Inc., the nation’s largest oil producer, lost 1.6 percent to C$31.68 and Cenovus Energy Inc. slipped 1.8 percent to C$32.75 as crude fell for the first time in three days. Crude oil for January delivery lost 1 percent to settle at $85.89 a barrel in New York.

Encana Corp., Canada’s largest natural gas producer, rose 2 percent to C$20.85 after PetroChina Co. said it will form a joint venture with the company by paying C$1.18 billion for a 49.9 percent stake in Alberta’s Duvernay formation. PetroChina will pay an additional C$1 billion over the next four years to fund development, Encana said in a statement today.

The deal is the first between Canada and a state-owned company since Canadian Prime Minister Stephen Harper unveiled new foreign investment rules on Dec. 7 that prohibit state-owned enterprises from taking control of Canadian oil-sands businesses unless there are “exceptional circumstances.”

Oncolytics surged 28 percent to C$3 after the company said initial data from a test of its product Reolysin in combination with carboplatin and paclitaxel, a type of chemotherapy, found 86 percent of those in the test arm of the study showed either tumor stabilization or shrinkage. This compares with 67 percent of patients in the control arm.

Sears Canada, the largest department-store chain in the country, added 5.8 percent to C$11.88. The company will pay a special cash dividend of C$1 a share following a partial spinoff of the company from its parent last month. Sears will pay out a total of about C$102 million on Dec. 31 to shareholders of record as of Dec. 24, the retailer said yesterday.

Research In Motion Ltd. climbed 3.7 percent to C$13.63. The company said U.S. Immigration and Customs Enforcement will test its new BlackBerry 10 devices early next year, becoming one of the first government agencies to try the new operating system.

US

By Rita Nazareth and Sofia Horta e Costa

Dec. 13 (Bloomberg) — U.S. stocks retreated, snapping a six-day advance in the Standard & Poor’s 500 Index, as the standoff in federal budget negotiations overshadowed a decline in jobless claims and a rebound in retail sales.

Newmont Mining Corp. and Mosaic Co. dropped at least 1.4 percent to pace losses in commodity shares. Phillips 66, the crude refiner that was spun off from ConocoPhillips in May, declined 1.6 percent on plans to raise as much as $400 million in an initial public offering for a minority interest in some of its pipeline and logistics assets. CVS Caremark Corp. climbed 2 percent after forecasting profit that beat estimates. Best Buy Co. jumped 16 percent on a report that founder Richard Schulze will offer to take the company private by Dec. 15.

The S&P 500 fell 0.6 percent to 1,419.45 at 4 p.m. New York time. The Dow Jones Industrial Average dropped 74.73 points, or 0.6 percent, to 13,170.72. About 6.1 billion shares changed hands on U.S. exchanges, or in line with the three-month average, according to data compiled by Bloomberg.

“It’s going to be a bumpy ride until we see some type of deal on the fiscal cliff,” said Matt McCormick, who helps oversee $7.3 billion as a money manager at Cincinnati-based Bahl & Gaynor Inc. “Speeches and speculation are the drivers of the market right now. I’m hopeful that we’ll see a resolution, but the politicians seem to be going a different tune.”

U.S. House Speaker John Boehner repeated his insistence that President Barack Obama’s budget proposal is “anything but” balanced and accused the president of being “not serious” about cutting spending. Obama said the negotiations are “still a work in progress.” The deadlock in talks to avoid more than $600 billion in tax increases and spending cuts will start taking effect in January unless Congress averts them.

Obama and Boehner were scheduled to meet today at the White House at 5 p.m. Washington time for further budget talks, according to a spokesman for the speaker.

Applications for jobless benefits fell by 29,000 to 343,000 in the week ended Dec. 8. Economists forecast 369,000 claims.

Retail sales in the U.S. rose in November as demand for automobiles rebounded and holiday shoppers snapped up electronics and clothes. Wholesale prices in the U.S. fell more than forecast in November, reflecting the biggest drop in the cost of energy since March 2009.

The Federal Reserve said yesterday it would buy $45 billion of Treasuries per month starting in January in an effort to boost growth. Interest rates will stay low “at least as long” as unemployment remains above 6.5 percent and if inflation is projected to be no more than 2.5 percent, it said.

European governments geared up to provide extra aid or debt relief for Greece after releasing the country’s first loan payment in six months, signaling renewed battles over how to stabilize the euro economy. Euro-area finance ministers approved the payout of 49.1 billion euros ($64 billion) of loans through March and committed to “additional measures” in case Greece’s debt reduction veers off track.

All 10 groups in the S&P 500 retreated today as health- care, energy and technology companies had the biggest losses.

Newmont Mining dropped 2.9 percent to $44.17. Mosaic, the largest U.S. fertilizer producer, slid 1.4 percent to $55.63.

Phillips 66 slid 1.6 percent to $52.21. The company plans to hold the IPO in the second half of 2013 for units in a master-limited partnership, or MLP, and use the proceeds to pay for expansion of its oil and natural gas transportation operations, the Houston-based company said today in a statement.

CVS Caremark climbed 2 percent to $48.50. Chief Executive Officer Larry Merlo has increased marketing and promotions to retain customers that it won when Walgreen Co. ended an agreement to provide Express Scripts Holding Co. shoppers with prescriptions.

Best Buy jumped 16 percent to $14.12. Schulze will submit an offer to the board before the Dec. 16 deadline, the Minneapolis Star-Tribune reported, citing a person it didn’t name. The bid will be about $5 billion to $6 billion, the newspaper said.

Clearwire Corp. surged 15 percent to $3.16 as Sprint Nextel Corp. offered to take it over in a $2.1 billion deal. Sprint, which already owns more than 50 percent of Clearwire, is seeking to acquire the remaining shares at $2.90 each, according to a regulatory filing today. That’s 5.5 percent more than the stock’s closing price in New York yesterday.

Research In Motion Ltd. added 4.1 percent to $13.86 after saying U.S. Immigration and Customs Enforcement will test its new BlackBerry 10 devices early next year, becoming one of the first government agencies to try the new operating system.

PBF Energy Inc. advanced 1 percent to $26.25, paring an earlier rally of as much as 8.4 percent. The oil refiner backed by First Reserve Management LP and Blackstone Group LP climbed after raising $533 million in an initial public offering that valued the company at $2.52 billion.

Warren Buffett’s Berkshire Hathaway Inc. placed a higher floor under its stock by raising the price limit for share repurchases, according to Whitney Tilson, a co-founder and managing director of T2 Partners LLC. Berkshire’s Class A stock has closed higher than the original ceiling since September of last year, when the insurance and investment company began the buyback program.

Berkshire said yesterday that it’s now willing to pay as much as 120 percent of book value for its two classes of common shares, rather than 110 percent. Yesterday’s closing prices for both classes came close to the higher percentage, tied to the value of assets after subtracting liabilities.

Tilson added to his firm’s stake in Berkshire after the increase was announced, the New York-based money manager wrote yesterday in an e-mail. T2 owns Class B stock, according to a regulatory filing. Each share is equivalent to 1/1,500th of a Class A share in the company, based in Omaha, Nebraska.

“Needless to say, I’m even happier having this as my largest position,” he wrote. Berkshire was second to American International Group Inc. among T2’s biggest holdings at the end of September, the filing showed.

 

Have a wonderful evening everyone.

 

Be magnificent!

 

We know that toleration is not sufficient toward another religion; we must accept it.

Thus it is not a question of subtraction, it is a question of addition.

The truth is the result of all these different sides added together.

Each religion represents one side, the fullness being the addition of all these.

Swami Vivekananda, 1863-1902

As ever,

 

Carolann

 

We all have the ability.  The difference is

how we use it.

-Stevie Wonder, 1950-

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:

Apparently tonight Barbara Walters has a special program featuring the 10 most fascinating people of 2012 (9:30PM, ABC).  Some rate a Meh.

December 12^th, 1901: Marconi makes the first radio transmission across the Atlantic.

-from the Globe & Mail today:

Three dots – pip, pip, pip – that in Morse code represents the letter “s” sent Newfoundland into the history books.  They were transmitted 2,735 km from Poldhu, Cornwall, in the United Kingdom to Signal Hill in St. John’s, where Italian inventor Guglielmo Marconi and his assistants hoisted an antenna with a kite above.  It was the first transatlantic wireless signal – but it almost didn’t happen there.  Marconi chose Signal Hill after storms destroyed transmitters he built in Cornwall and Cape Cod, Mass.  After the successful transmission, he expressed confidence that “mankind would be able to send messages without wires….between the farthermost ends of the Earth.”  Marconi left Newfoundland because of legal issues but returned in 1904, setting up a wireless station at Cape Race – famous for receiving the Titanic’s SOS call in 1912. –Jane Taber.

**Speaking of Cornwall, I have forgotten who sent me the recommendation to read When God was a Rabbit by Sarah Winman, but whoever it was, THANK YOU!  (Part of the setting for the novel is in Cornwall). I took your advice and bought it when it was first recommended, but only got around to reading it recently.  It is an amazing read.   I loved it.  I recommend it.

 

Also on this day in…

1787 – Pennsylvania became the second state to ratify the U.S. Constitution.

1821 – Gustav Flaubert was born.

1914 – The New York Stock Exchange re-opened for the first time since July 30. The market had shut down when World War I broke out.

1915 – Singer Frank Sinatra was born in Hoboken, N.J.

I feel sorry for people who don’t drink. When they wake up in the morning, that’s as good as they’re going to feel all day. –Frank Sinatra

1975 – Sara Jane Moore pleaded guilty to trying to kill President Gerald R. Ford.

1998 – The House Judiciary Committee approved a fourth article of impeachment against President Bill Clinton and submitted the case to the full House.

 

This is the last  triple date for almost a century: next time is 01/01/2101.

photos of the day

December 12, 2012

A street performer poses with an iPad with the time reading 12:12:12 in the Plaza Mayor in Madrid.

Paul Hanna/Reuters

Workers walk past clocks showing a time of 12 minutes past 12 noon, on this century’s last sequential date, in a plaza in the Canary Wharf business district of London.

Toby Melville/Reuters

 

Market Closes for December 12th, 2012:

 

Market  Index	Close	Change
Dow  Jones	13245.45	-2.99    -0.02%
S&P 500	1428.48	+0.64    +0.04%
NASDAQ	3013.814	-8.488    -0.28%
TSX	12353.09	+70.73
		+0.58%

International Markets

Market  Index	Close	Change
NIKKEI	9581.46	+56.14
		+0.59%
HANG  SENG	22503.35	+179.41
		+0.80%
SENSEX	19355.26	-31.88
		-0.16%
FTSE 100	5945.85	+20.88
		+0.35%

Bonds

Bonds	% Yield	Previous % Yield
CND.  10 Year Bond	1.759	1.730
CND.   30 Year Bond	2.367	2.335
U.S.   10 Year Bond	1.6988	1.6541
U.S.   30 Year Bond	2.8918	2.8403

Currencies

BOC Close	Today	Previous
Canadian $	0.98463	0.98603
US   $	1.01561	1.01417
Euro Rate  1 Euro=		Inverse
Canadian   $	1.28722	0.77687
US  $	1.30731	0.76493

Commodities

Gold	Close	Previous
London Gold   Fix	1711.55	1710.40
Oil	Close	Previous
WTI Crude Future	86.77	85.79
BRENT	110.82	109.44

Market Commentary:

Canada

By Eric Lam

Dec. 12 (Bloomberg) — Canadian stocks rose for a fourth day after gold miners advanced as the U.S. Federal Reserve expanded its asset-purchase program and budget talks continued in Washington.

Lake Shore Gold Corp. climbed 14 percent after boosting its processing capacity. Barrick Gold Corp. and Goldcorp Inc. advanced at least 2.9 percent as the price of the metal traded at a one-week high. Just Energy Group Inc. added 4 percent after the natural gas and electricity supplier announced a C$105 million investment from the Canada Pension Plan Investment Board. Cenovus Energy Inc. fell 1.1 percent after it said cash flow will likely fall in 2013.

The Standard & Poor’s/TSX Composite Index advanced 70.73 points, or 0.6 percent, to 12,353.09 in Toronto.

A technical error caused the calculation of the benchmark equity index to be incorrect for a period during the trading day. The S&P/TSX didn’t receive accurate data for stocks with tickers from A through L starting at 10:42 a.m. in Toronto, Carolyn Quick, a spokeswoman for the Toronto Stock Exchange, said. The company said the data issue was resolved at 12:21 p.m.

“People’s portfolios are fairly de-risked already and the bulk of the protection selling is done, so there’s a slow drift upwards as we come closer to the culmination of these fiscal cliff talks,” said Bob Decker, a fund manager with Aurion Capital in Toronto. The firm manages about C$5.5 billion ($5.58 billion).

Negotiations for a U.S. budget compromise continued with President Barack Obama yesterday reducing his demand for tax increases to $1.4 trillion from $1.6 trillion. Democrats and Republicans remain hundreds of billions of dollars apart as a year-end deadline to avoid more than $600 billion in automatic tax increases and spending cuts approaches.

The U.S. central bank said it will buy $45 billion a month of Treasury securities starting in January, in addition to $40 billion a month of mortgage-debt purchases. Asset buying will continue “if the outlook for the labor market does not improve substantially,” the Federal Open Market Committee said today at the conclusion of a two-day meeting in Washington.

Toronto-Dominion Bank rose 0.6 percent to C$81.08 and Bank of Nova Scotia added 0.7 percent to C$56.88 as bank and raw materials stocks contributed most to gains on the S&P/TSX as eight of 10 industries advanced. Trading volume was 40 percent higher than the 30-day average.

Lake Shore Gold surged 14 percent to 82 Canadian cents after the gold mining company said it now has a processing capacity of 2,500 metric tons a day, a 25 percent increase. The company expects to push capacity to 3,000 metric tons a day in the second quarter of 2013.

Centerra Gold Inc. climbed 6.1 percent to C$8.93 after announcing it has purchased from Stratex International Plc the 30 percent stake in the Oksut gold project in Turkey it doesn’t already own for $20 million in cash and a 1 percent smelter royalty.

Barrick, the world’s largest producer of gold, added 3 percent to C$34.56 and Goldcorp rose 2.9 percent to C$37.63.

Gold for February delivery increased 0.5 percent to settle at $1,717.90 an ounce in New York.

Just Energy gained 4 percent to C$9.70 after the Mississauga, Ontario-based company said the CPPIB has purchased C$105 million in five-and-a-half year bonds with a coupon of 9.75 percent. Just Energy plans to use the cash to reduce its drawings on its working capital line, fund future growth and for general corporate purposes.

Sprott Resource Corp. jumped 11 percent to C$3.88, the most in more than two years, after the investment company initiated a monthly dividend of 3.8 Canadian cents a share.

Cenovus slipped 1.1 percent to C$33.34 as the oil producer spun off by Encana Corp. said cash flow will be C$3.1 billion to C$4 billion in 2013. The company’s 2012 estimate is for cash of C$3.7 billion in 2012. Cenovus blamed the lowered guidance on “expectations of lower realized oil prices.”

US

By Lu Wang and Inyoung Hwang

Dec. 12 (Bloomberg) — U.S. stocks erased gains as optimism about Federal Reserve plans to buy more bonds faded, with investor focus returning to the budget deadlock in Washington.

Berkshire Hathaway Inc. climbed 2.4 percent after lifting the threshold it will pay for stock, signaling Chief Executive Officer Warren Buffett views the shares as undervalued. DuPont Co. advanced 1.4 percent as the chemical maker announced a share buyback and said 2012 earnings will be at the high end of forecasts. Eli Lilly & Co. sank 3.2 percent after saying it’s conducting an added study for an experimental Alzheimer’s drug.

The Standard & Poor’s 500 Index rose less than 0.1 percent to 1,428.48 in New York, erasing an earlier rally of as much as 0.8 percent. The Dow Jones Industrial Average slipped 2.99 points, or less than 0.1 percent, to 13,245.45. More than 6.6 billion shares changed hands on U.S. exchanges, or 6.3 percent above the three-month average, according to data compiled by Bloomberg.

“Traders have been poking holes in some of the Fed comments,” Michael James, a managing director of equity trading at Wedbush Securities Inc. in Los Angeles, said in an e-mail.

“Nothing hugely ‘negative,’ just reason to be doing some selling with the strength we’ve had in the last couple days. Markets are very thin right now and subject to bigger swings this week.”

Stocks rallied after the central bank said it will buy $45 billion a month of Treasury securities starting in January, in addition to $40 billion a month of mortgage-debt purchases, as part of its effort to stimulate the economy. Asset buying will continue “if the outlook for the labor market does not improve substantially,” the Federal Open Market Committee said today at the conclusion of a two-day meeting in Washington.

The rally faded as Fed Chairman Ben S. Bernanke said monetary stimulus cannot offset the full effect of the so-called fiscal cliff of automatic tax increases and budget cuts set to go into effect next year.

President Barack Obama is seeking a deal with Republican lawmakers to avoid the fiscal cliff, lowering his demand for tax increases in the budget to $1.4 trillion from $1.6 trillion yesterday. House Speaker John Boehner said today that Obama’s revenue demand can’t pass the House or the Senate. Democrats and Republicans remain divided on taxes and spending, as well as on whether an agreement should include an increase in the debt limit and further programs to boost the economy.

“People finally realized that we still have the fiscal cliff waiting in the wings,” Thomas Garcia, head of equity trading at Santa Fe, New Mexico-based Thornburg Investment Management Inc., said in an e-mail. His firm oversees about $80 billion. What the Fed “said in the minutes should be bullish for equities,” he said.

The S&P 500 has erased its losses since Election Day, advancing 0.9 percent so far this month to give the benchmark index a 14 percent rally for 2012. Its average gain for December is 1.5 percent, the highest of any month except July, according to data dating back to 1928 compiled by Bloomberg. The stock market may also get a year-end boost from a so-called Santa Claus rally — an upswing in the last five days of the year and the first two in January, according to the Stock Trader’s Almanac.

The S&P 500 will surpass its record to reach 1,580 at the end of next year, according to Thomas Lee, chief U.S. equity strategist at JPMorgan Chase & Co. His forecast is 0.9 percent higher than the benchmark equity measure’s all-time high of 1,565.15 and 11 percent above its closing level yesterday.

Stocks will rally as investors get clarity on political concerns in the U.S. and Europe, an acceleration in durable goods spending lifts price-earnings multiples and earnings growth picks up, according to New York-based Lee in a note dated today.

Phone, financial and energy companies had the biggest gains among 10 industry groups, adding at least 0.4 percent.

Technology, consumer staples and material stocks posted the largest losses, falling more than 0.2 percent each.

Berkshire climbed 2.4 percent to $89.32. The company said it will pay as much as 120 percent of book value, a measure of assets minus liabilities for stock buybacks. The limit was 110 percent. Buffett, 82, and Vice Chairman Charles Munger have been weighing buybacks as the company seeks to deploy part of its $47.8 billion cash hoard. Berkshire last year began a buyback program after shunning repurchases for four decades.

DuPont climbed 1.4 percent to $44.30. The biggest U.S. chemical maker by market value said 2012 earnings will reach the upper end of the company’s forecast and it will spend as much as $1 billion to repurchase shares. Earnings excluding one-time items will approach $3.30 a share this year and increase by the “low- to mid-single digits” for 2013, DuPont said.

Aetna Inc. rose 3.2 percent to $45.91. The third-biggest U.S. health insurer by membership said earnings excluding one- time items in 2013 will be at least $5.40 a share, while revenue will rise about 9 percent to $38.6 billion. The forecasts “should be good enough given low expectations, Chris Rigg, an analyst with Susquehanna Financial Group, wrote in a note.

Nasdaq OMX Group Inc. jumped 3.8 percent to $24.31. The second-largest U.S. equity exchange agreed to buy Thomson Reuters Corp. units that provide investor and public relations and multimedia services for $390 million in cash as it seeks to diversify.

An S&P index of homebuilders surged 3.5 percent as Mortgage Bankers Association’s index of applications rose 6.2 percent last week and the group’s purchase measure reached the highest level in a year. D.R. Horton Inc. increased 3.5 percent to $19.21 while Lennar Corp. advanced 4 percent to $37.87.

Dolby Laboratories Inc. added 2.4 percent to $35. The audio-technology company whose products are used in cinemas, announced a special one-time dividend of $4 a share.

Eli Lilly sank 3.2 percent to $49. The company said it will conduct an additional late-stage study of its experimental Alzheimer’s treatment solanezumab, a move that could push the drug’s introduction back three years to 2016. Lilly said it doesn’t believe it has enough data to gain U.S. marketing clearance for the medicine, based on conversations with the Food and Drug Administration.

 

Have a wonderful evening everyone.

 

Be magnificent!

 

That which is immoral is imperfectly moral,

just as that which is false is true to an inadequate degree.

Rabindranath Tagore1861-1901

As ever,

 

Carolann

 

Do not read, as children do, for the sake of entertainment,

or like the ambitious, for the purpose of instruction.  No,

read in order to live.

-Gustave Flaubert, 1821-1880

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:

Emily Dickinson was born on December 10^th, 1830 at Amherst, Massachusetts.  She was reclusive, mysterious, and frail in health.  Seven of her poems were published during her life, but after her death in 1886, her sister, Lavinia, discovered almost 2,000 more poems written on the backs of envelopes and other scraps of paper locked in Emily’s bureau.  They were published gradually over 50 years, beginning in 1890.  She is now recognized as one of the most original poets of the English-speaking world.

The Only News I Know

-Emily Dickinson

 

The only news I know

Is bulletins all day

From Immortality.

 

The only shows I see,

Tomorrow and Today,

Perchance Eternity.

 

The only One I meet

Is God, – the only street,

Existence; this traversed

 

If other news there be,

Or admirable show –

I’ll tell it you.

 

And also on this day in…

1520 – Martin Luther publicly burned the papal edict demanding that he recant or face excommunication.

1901 – The first Nobel Prizes are awarded

1915 – Ford Motors manufactures its One Millionth car

1965 – The Grateful Dead played their first concert, at the Fillmore Auditorium in San Francisco.

1967 – Singer Otis Redding died at age 26 in the crash of his private plane in Wisconsin.

1998 – Six astronauts opened the doors to the new international space station.

2002 – Former President Jimmy Carter accepted the Nobel Peace Prize for his diplomacy in the Middle East in the 1970s.

2007 – Former Vice President Al Gore accepted the Nobel Peace Prize with a call for humanity to rise up against a looming climate crisis.

2009 – President Barack Obama accepted the Nobel Peace Prize with a humble acknowledgment of his scant accomplishments and a robust defense of the U.S. at war.

2009 – James Cameron’s 3-D film epic “Avatar” had its world premiere in London.

 

Prosperity does not exalt the wise man, nor does adversity cast him down. –Seneca the Younger, 5 BC-65 AD.

photos of the day

December 10, 2012

Children watch as candles are lit for the Jewish holiday of Hanukkah in Jerusalem’s Mea Shearim neighborhood.

Ammar Awad/Reuters

Johan Huibers poses with a stuffed tiger in front of the full-scale replica of Noah’s Ark in Dordrecht, Netherlands. The Ark has opened its doors after receiving permission to receive up to 3,000 visitors per day. In the Bible story, God ordered Noah to build a boat massive enough to save animals and humanity while God destroyed the rest of the earth in an enormous flood.

Peter Dejong/AP

 

Market Closes for December 10th, 2012:

 

Market  Index	Close	Change
Dow  Jones	13169.88	+14.75    +0.11%
S&P 500	1418.55	+0.48    +0.03%
NASDAQ	2986.961	+8.920    +0.30%
TSX	12230.47	+70.88
		+0.58%

International Markets

Market  Index	Close	Change
NIKKEI	9533.75	+6.36
		+0.07%
HANG  SENG	22276.72	+85.55
		+0.39%
SENSEX	19409.69	-14.41
		-0.07%
FTSE 100	5921.63	+7.23
		+0.12%

Bonds

Bonds	% Yield	Previous % Yield
CND.  10 Year Bond	1.700	1.710
CND.   30 Year Bond	2.307	2.312
U.S.   10 Year Bond	1.6164	1.6215
U.S.   30 Year Bond	2.7979	2.8104

Currencies

BOC Close	Today	Previous
Canadian $	0.98654	0.98875
US   $	1.01364	1.01138
Euro Rate  1 Euro=		Inverse
Canadian   $	1.27728	0.78291
US  $	1.29467	0.77239

Commodities

Gold	Close	Previous
London Gold   Fix	1712.60	1704.05
Oil	Close	Previous
WTI Crude Future	85.56	85.93
BRENT	108.25	108.39

Market Commentary:

Canada

By Eric Lam

Dec. 10 (Bloomberg) — Canadian stocks rose for a second day as Nexen Inc. and Progress Energy Resources Corp. surged after the government approved takeovers of the energy companies.

Nexen, to be acquired by China-owned Cnooc Ltd. for $15.1 billion, soared 14 percent. Progress, which expects to close its C$5.2 billion ($5.2 billion) deal with Malaysia’s Petroliam Nasional Bhd this week, rose 13 percent. Both deals were approved Dec. 7. Athabasca Oil Corp. and MEG Energy Corp. fell at least 2.4 percent after the government said it will limit foreign takeovers by state-owned companies interested in Canada’s oil sands.

The Standard & Poor’s/TSX Composite Index advanced 70.88 points, or 0.6 percent, to 12,230.47 in Toronto. The equity gauge has gained 2.3 percent this year.

“It’s the haves and the have nots: Nexen and Progress have been taken out, but the state-owned enterprises are on the sidelines now where they won’t be able to buy Athabasca and those sorts of companies,” said Ian Nakamoto, director of research with MacDougall MacDougall & MacTier Inc. in Toronto.

His firm manages about $4 billion. “It doesn’t mean they aren’t still in play, but it’s always better to have more potential suitors.”

The Canadian market was also lifted by optimism for a budget compromise in Washington and better-than-expected economic data from China over the weekend, Nakamoto said.

“The sentiment on the fiscal cliff is positive, but hopefully it doesn’t become too positive because these things can always fall off the rails pretty soon,” Nakamoto said.

U.S. President Barack Obama and House Speaker John Boehner met yesterday at the White House, with representatives for the two leaders offering no details of the negotiations while issuing identical statements afterward that “the lines of communication remain open.” Leaders in the U.S. need to agree on a budget to prevent more than $600 billion of automatic tax increases and spending cuts from coming into effect next year.

China’s industrial production climbed 10.1 percent last month, while retail sales grew 14.9 percent, the statistics bureau said yesterday. Economists in a Bloomberg survey had a median estimate of 9.8 percent growth in industrial production and a 14.6 percent increase in retail sales.

Energy and raw-materials stocks contributed most to gains in the S&P/TSX as all 10 industries advanced. Trading volume was 21 percent higher than the 30-day average, according to data compiled by Bloomberg.

Nexen jumped 14 percent to C$26.44, its biggest gain since July. The deal by Beijing-based Cnooc is the largest-ever takeover by a Chinese company, according to data compiled by Bloomberg. It gives the state-owned company a stake in Canada’s largest oil-sands project and the biggest position in the Buzzard oil field in the U.K. North Sea.

Progress soared 13 percent to C$21.96. Following the acquisition, the companies will make a final investment decision on a proposed liquefied natural gas terminal in British Columbia in late 2014, according to a joint statement on their websites.

The facility may cost $9 billion to $11 billion, with the exports expected in 2018, they said.

MEG Energy, which is developing the Christina Lake project in the Athabasca region of Alberta, fell 3.1 percent to C$33.65 and Athabasca Oil, which is also developing oil sands interests in the Athabasca region, slipped 2.4 percent to C$10. Canadian Prime Minister Stephen Harper introduced new regulations on Dec. 7 that will prevent further controlling investments by foreign state-owned enterprises in the oil sands industry other than in “exceptional circumstances.”

HudBay Minerals Inc. added 5.7 percent to C$10.33 and Dundee Precious Metals Inc. climbed 5.6 percent to C$9.01 as gold for February delivery advanced 0.5 percent to settle at $1,714.40 an ounce in New York.

Silver Standard Resources Inc. rose 5 percent to C$14.29 and Silver Wheaton Corp. added 2.1 percent to C$36.15. Silver for March delivery rose 0.7 percent to $33.377 an ounce in New York.

US

By Rita Nazareth and Adria Cimino

Dec. 10 (Bloomberg) —  U.S. stocks advanced, after the longest weekly rally in the Standard & Poor’s 500 Index since August, as economic data in China beat estimates and investors watched the latest developments in American budget talks.

McDonald’s Corp., the largest restaurant chain, added 1.1 percent as its November sales rose 2.4 percent globally. Cliffs Natural Resources Inc. and Newmont Mining Corp. rose at least 1.5 percent to pace gains in commodity producers. American International Group Inc. slid 2.3 percent after the insurer said superstorm Sandy will cost the company about $1.3 billion.

The S&P 500 rose less than 0.1 percent to 1,418.55 at 4 p.m. New York time. The Dow Jones Industrial Average added 14.75 points, or 0.1 percent, to 13,169.88. About 5.3 billion shares changed hands on U.S. exchanges, or 15 percent below the three- month average, according to data compiled by Bloomberg.

“China hit that trough and is starting to see an acceleration of growth,” said Tom Wirth, who helps manage $1.6 billion as senior investment officer for Chemung Canal Trust Co., in Elmira, New York, said in a phone interview. “As far as our market goes, I don’t think there’s anything out there right now. It’s waiting on the politicians.”

China’s stocks rose the most among Asian equity markets today as the Shanghai Composite Index jumped to a four-week high after factory output and retail sales data beat economists’ estimates. U.S equities fell earlier today as Italian Prime Minister Mario Monti said he lost support and will resign.

In the U.S., lawmakers from both parties are leaving rhetorical room for a split-the-difference agreement with President Barack Obama on a U.S. budget deal. The president and House Speaker John Boehner met one-on-one yesterday at the White House, with representatives for the two leaders offering no details of the negotiations yet issuing identical statements afterward that “the lines of communication remain open.”

McDonald’s added 1.1 percent to $89.41. Analysts projected a gain of 0.2 percent for sales at stores open at least 13 months, the average of 14 estimates compiled by Consensus Metrix. Sales in the U.S. increased 2.5 percent, the Oak Brook, Illinois-based company said today in a statement. Analysts anticipated a drop of 0.6 percent.

Commodity shares gained. Cliffs Natural added 4.6 percent to $30.86. Newmont Mining increased 1.6 percent to $45.11.

Halozyme Therapeutics Inc. added 3.5 percent to $5.94 after a filing by partner Roche Holding AG with European regulators triggered a $4 million milestone payment.

Comtech Telecommunications Corp. climbed 3.9 percent to $25.06. The satellite equipment maker that derives about half its revenue from the U.S. government rose after a rating upgrade by JPMorgan Chase & Co.

AIG lost 2.3 percent to $33.36. The company will make a capital contribution of $1 billion to its U.S. property-casualty subsidiaries, the New York-based insurer said. Sandy’s cost was about $2 billion before tax, AIG said. Sandy made landfall in New Jersey in October and damaged homes, vehicles and commercial property while interrupting business in states including New York.

The S&P 500 Retailing Index dropped 1.5 percent in the biggest decline among 24 groups. Priceline.com Inc. retreated 5 percent to $625.96. The online travel service was downgraded to hold from buy at Deutsche Bank AG by equity analyst Ross Sandler. The 12-month share-price estimate is $710.

Options traders are sending bearish contracts on Dell Inc. to the lowest level in seven years, reducing hedges after the stock plunged 29 percent this year and the third-biggest personal computer maker took steps to expand into new businesses.

Puts protecting against a 10 percent decline in the shares cost 0.98 point more than calls betting on a 10 percent gain, based on three-month data compiled by Bloomberg. The price relationship known as skew reached 0.38 on Nov. 15, the lowest since August 2005. While Dell shares have climbed 18 percent since reaching a 3 1/2-year low on Nov. 16, the stock is trading near its cheapest level compared with analysts’ profit estimates since 2009.

Dell is expanding with acquisitions in other businesses as customers turn to smartphones and tablets and demand for PCs declines. Goldman Sachs Group Inc. last week recommended buying the shares on speculation the company may be acquired.

Dell is buying companies that are “very high-margin, very high-growth,” Brian Frank, a money manager at Frank Capital LLC, which oversees $25 million, said in a Dec. 3 interview at Bloomberg’s headquarters. The New York-based investment firm has 3.2 percent of its assets in Dell, making the stock its ninth- largest holding, according to Frank.

 

Have a wonderful evening everyone.

 

Be magnificent!

 

Though they may take various roads, all are on the way.

Swami Vivekananda, 1863-1902

As ever,

 

Carolann

 

Unrest of spirit is a mark of life.

-Karl Menninger, 1893-1990

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:

WE ARE THE DECISIVE ELEMENT

I have come to the frightening conclusion that I am the decisive element.

It is my personal approach that creates the climate.

It is my daily mood that makes the weather.

I possess tremendous power to make life miserable or joyous.

I can be a tool of torture or an instrument of inspiration.

I can humiliate or humor, hurt or heal.

In all situations, it is my response that decides whether a crises is escalated or de-escalated, and a person I humanized or de-humanized…

-Johann Wolfgang von Goethe, 1749-1832.

On this day in…

1941 – Japanese planes raid Pearl Harbor in a surprise attack.

1942 – The U.S. Navy launches USS New Jersey, the largest battleship ever built.

1949 – The A.F.L. and the C.I.O. organize a non-Communist international trade union.

1972 – The crew of Apollo 17, the last manned mission to the moon, lifts off at Cape Canaveral, Florida.

1981 – The Reagan Administration predicts a record deficit in 1982 of $109 billion.

1988 – An earthquake in Armenia kills an estimated 100,000 people.

 

Do not dwell in the past, do not dream of the future, concentrate the mind on the present moment.  –Buddha.

photos of the day

December 7, 2012

Great Tit birds feed on nuts and seeds left by visitors in a bird feeder in a park in central Minsk, Belarus.

/Vasily Fedosenko/Reuters

A lobster boat heads out to sea at dawn in South Portland, Maine. A red sky in the morning often indicates a storm system is moving east.

Robert F. Bukaty/AP

 

Market Closes for December 7th, 2012:

Market  Index	Close	Change
Dow  Jones	13155.13	+81.09    +0.62%
S&P 500	1418.07	+4.13    +0.29%
NASDAQ	2978.041	-11.226    -0.38%
TSX	12159.59	+8.46
		+0.07%

International Markets

Market  Index	Close	Change
NIKKEI	9527.39	-17.77
		-0.19%
HANG  SENG	22191.17	-58.64
		-0.26%
SENSEX	19424.10	-62.70
		-0.32%
FTSE 100	5914.40	+12.98
		+0.22%

Bonds

Bonds	% Yield	Previous % Yield
CND.  10 Year Bond	1.710	1.695
CND.   30 Year Bond	2.312	2.302
U.S.   10 Year Bond	1.6215	1.5857
U.S.   30 Year Bond	2.8104	2.7739

Currencies

BOC Close	Today	Previous
Canadian $	0.98875	0.99156
US   $	1.01138	1.00851
Euro Rate  1 Euro=		Inverse
Canadian   $	1.27820	0.78235
US  $	1.29274	0.77355

Commodities

Gold	Close	Previous
London Gold   Fix	1704.05	1699.83
Oil	Close	Previous
WTI Crude Future	85.93	86.26
BRENT	108.39	108.45

Market Commentary:

Canada

By Inyoung Hwang

Dec. 7 (Bloomberg) — Canadian stocks rose, paring a weekly decline in the Standard & Poor’s/TSX Composite Index, as reports showing faster-than-estimated job growth overshadowed a decline in U.S. consumer confidence.

Transcontinental Inc. rallied 6.6 percent, the most in more than a year, after TD Securities recommended buying shares of the commercial printer. Viterra Inc. rose 2.1 percent after Glencore International Plc received Chinese regulatory approval to take over the grain handler. Harry Winston Diamond Corp. lost 1 percent after its chief executive officer said now isn’t the right time to sell its retail unit.

The S&P/TSX advanced 8.64 points, or 0.1 percent, to 12,159.77 in Toronto. The equity gauge lost 0.7 percent in the week after a report showed manufacturing in the U.S. unexpectedly shrank and the Bank of Canada maintained a bias to raise interest rates.

“The initial headline number for the jobs report was a beat,” Jeffrey Bradacs, a fund manager with Manulife Asset Management Ltd., said from Toronto. He oversees about C$1.5 billion. “It was less about how strong the economy was but more about analysts having difficulty predicting the effects of hurricane Sandy.”

U.S. employment climbed by 146,000 jobs last month, a Labor Department report showed today, exceeding the 85,000 forecast by 91 economists surveyed by Bloomberg. The jobless rate in the world’s largest economy dropped to 7.7 percent, its lowest level in four years.

A separate report showed Canadian employment rose almost six times faster than economists forecast in November with most of the increase coming from full-time and private-sector work.

The increase of 59,300 lowered the unemployment rate to 7.2 percent from 7.4 percent, the first decline in five months, Statistics Canada said today in Ottawa. Economists surveyed by Bloomberg News projected a 10,000 gain in jobs and 7.4 percent unemployment, according to median forecasts.

The S&P/TSX pared early gains after a report showed confidence among U.S. consumers fell more than forecast in December. The Thomson Reuters/University of Michigan preliminary consumer sentiment index decreased to 74.5, the weakest in four months, from 82.7 in November. Economists projected a preliminary reading of 82 for December, according to the median of 67 estimates in a Bloomberg survey.

Investors also watched developments on U.S. budget negotiations. U.S. House Speaker John Boehner said “there’s no progress to report” on talks with President Barack Obama to avert tax increases and spending cuts set to take effect in January.

Transcontinental rallied 6.6 percent to C$10.66 after it was raised to “buy” from “hold” at TD Securities by analyst Michael Elkins. The 12-month target price is C$12.00 per share.

Viterra increased 2.1 percent to C$16.20. Glencore International’s C$6.1 billion takeover of Canada’s largest grain handler received Chinese regulatory approval. Approval from China’s Ministry of Commerce will allow for the takeover to be completed by Dec. 17. Glencore agreed to buy Viterra for C$16.25 a share.

The price of gold rose while oil fell. The S&P GSCI Index of commodities lost 0.4 percent today 2.6 percent this week.

Goldcorp, the world’s second-largest producer of the metal, rallied 1.2 percent to C$36.91. Suncor Energy Inc. lost 0.7 percent to C$32.24.

Lundin Mining Corp. slid 4.6 percent to C$5.01. The metal producer forecast copper production from 2013 through 2015 will be between 100,000 tons and 110,000 tons a year. The estimates were disappointing, George Topping, a Toronto-based analyst at Stifel Nicolaus & Co., said in an e-mail.

Harry Winston, the only gem producer and jewelry retailer in Canada, slumped 1 percent to C$14.13.

“We don’t have any great pressure to dispose of the diamond luxury retail business,” Chairman and Chief Executive Officer Robert Gannicott said today on Harry Winston’s earnings conference call. “It’s not a particularly good time to contemplate doing that anyway.”

US

By Lu Wang and Rita Nazareth

Dec. 7 (Bloomberg) — U.S. stocks rose, sending the Standard & Poor’s 500 Index higher for a third week, as optimism over better-than-estimated jobs data overshadowed a drop in consumer confidence amid continuing budget talks.

JPMorgan Chase & Co. and Bank of America Corp. advanced more than 1.7 percent as financial shares rallied. American International Group Inc. rose 2.6 percent after saying it is in talks to sell 90 percent of its plane-leasing unit. Apple Inc. lost 2.6 percent, sending the maker of iPhones and iPad tablet computers to its biggest weekly decline since May 2010.

The S&P 500 rose 0.3 percent to 1,418.07, the highest level since Nov. 6, at 4 p.m. New York time. The Dow Jones Industrial Average gained 81.09 points, or 0.6 percent, to 13,155.13, extending its weekly advance to 1 percent. Both gauges advanced for a third week, the longest winning streak since August. The Nasdaq Composite Index dropped 0.4 percent to 2,978.04. More than 5.48 billion shares changed hands on U.S. exchanges, or 12 percent below the three-month average.

“We’re increasing equities,” Barry James, who helps oversee $3.5 billion as president of James Investment Research in Xenia, Ohio, said in a phone interview. “People got too pessimistic about the whole fiscal cliff thing. The markets are in a way looking for a reason to go up.”

Stocks rallied as Labor Department figures showed employment climbed by 146,000 following a revised 138,000 gain in October that was less than initially estimated. The median estimate of 91 economists surveyed by Bloomberg called for a gain of 85,000. Superstorm Sandy “did not substantively impact” the data, the agency said. The unemployment rate fell to 7.7 percent, the lowest since December 2008, as the size of the labor force shrank.

U.S. equities briefly erased gains after a gauge of consumer confidence decreased more than forecast. The Thomson Reuters/University of Michigan preliminary index of U.S. consumer sentiment for December fell to 74.5 from 82.7 a month earlier. The median economist estimate was for a decrease to 82.

Investors also watched developments in federal budget negotiations. The White House has “wasted another week” and no progress has been made in budget talks, House Speaker John Boehner said in a news conference today in Washington. President Barack Obama and Republicans are working toward a compromise to avert what has been labeled a fiscal cliff — a Jan. 1 surge of more than $600 billion in automatic tax increases and spending cuts that could propel the nation into recession.

“There is a lot of confusion and there are a lot of cross currents here to consider,” Terry L. Morris, who helps oversee about $2.5 billion at Wyomissing, Pennsylvania-based National Penn Investors Trust Co., said in a phone interview.

“Unemployment has improved, yet confidence deteriorated. How do you explain the market isn’t doing anything when Boehner comes out and says we’re nowhere? It seems like the market should have been going down, but the fact it’s not tells me that the market wants to go higher.”

Today’s gain pushed the S&P 500 above its average in the past 50 days for the first time since Oct. 19, according to data compiled by Bloomberg. The index had spent the previous 32 days below the threshold, the longest streak since a 52-day stretch that ended Oct. 7, 2011, the data show. The average is watched by traders to gauge the market’s trends.

Financial companies in the S&P 500 climbed 0.8 percent as a group to the highest level since Nov. 6. JPMorgan Chase rallied 2.6 percent, the most in the Dow, to $42.56, while Bank of America advanced 1.7 percent to $10.64.

AIG rose 2.6 percent to $34.13. The insurer said it is in talks to sell 90 percent of its plane-leasing unit to an investor group including New China Trust Co. A deal may value International Lease Finance Corp. at about $5.5 billion, according to one person with knowledge of the matter, who asked not to be identified because the talks are confidential.

After the close of regular trading, AIG said superstorm Sandy will cost the company about $1.3 billion after taxes and reinsurance, the highest sum disclosed by a U.S. insurer. The shares tumbled 1.8 percent as of 4:42 p.m. in New York.

Freeport-McMoRan Copper & Gold Inc. climbed 2.9 percent to $31.70. The world’s largest publicly traded copper producer was raised to strong buy from buy at Oracle Investment. The stock slumped 20 percent in the previous two days after agreeing to buy Plains Exploration & Production Co. and McMoRan Exploration Co. for $9 billion. The move was a “game changer and a wise use of capital,” Oracle analyst Laurence Balter said in a note.

Macy’s Inc. gained 1.3 percent to $39.41 after the department-store chain authorized a $1.5 billion increase in share repurchases.

McGraw-Hill Cos. gained 4.2 percent to $56.53. The global information-services provider announced a special dividend of $2.50 a share.

Computer and software makers in the S&P 500 fell 0.6 percent for the only loss among 10 industry groups.

Apple slipped 2.6 percent to $533.25. The shares slumped 8.9 percent this week amid concern that the company will lose ground in smartphones to Nokia Oyj in China while giving up market share to Google Inc. in tablets.

Amarin Corp. sank 19 percent to $9.69. The maker of the cholesterol-lowering drug Vascepa fell as investors lost confidence that the company will soon be acquired.

The cost of protecting against swings in financial shares from JPMorgan to Berkshire Hathaway Inc. has fallen to a 19- month low as banks fire workers to improve profitability and the housing market recovers.

Implied volatility for three-month contracts with an exercise price closest to the Financial Select Sector SPDR Fund was 21 percent higher than for the SPDR S&P 500 ETF Trust yesterday, according to data compiled by Bloomberg. That’s the smallest gap between the key measures of options prices since May 2011. A gauge of banks, brokerages and insurers in the S&P 500 has climbed 22 percent this year, the most among the 10 main groups.

Analysts forecast that financial companies will post the third-fastest profit growth among S&P 500 industries next year as mortgage interest rates near record lows help drive demand for a shrinking property supply and banks reduce costs. Home prices in October rose the most since 2006 and the U.S. economy expanded more than previously estimated in the third quarter.

“The market is recognizing that the financial sector is healing,” Paul Zemsky, the New York-based head of asset allocation for ING Investment Management, which oversees $170 billion, said in a phone interview yesterday. “Housing prices are rising, so the collateral of the banking system is getting more valuable, which helps banks weather any future problems.”

Have  a wonderful weekend everyone.

 

Be magnificent!

 

Our contribution

to the progress of the world must, therefore,

consist in setting own house in order.

Mahatma Gandhi, 1869-1948

As ever,

 

Carolann

 

Nothing will work unless you do.

-Maya Angelou, 1928-

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:

It’s St. Nicholas Day in Europe.  St. Nicholas is the patron saint of merchants. 🙂

Today would have been Dave Brubeck’s 92^nd birthday.  The Jazz great died yesterday morning.

And also on this day in…

1865 – 13^th Amendment ratified; slavery abolished.

1877 –  Thomas A. Edison makes the first sound recording when he recites “Mary had a Little Lamb” into his phonograph machine.

1896 – Ira Gershwin was born.

1917 –  The Bolsheviks imprison Czar Nicholas II and his family in Tobolsk.

1938 –  France and Germany sign a treaty of friendship.

1976 –  Democrat Tip O’Neill is elected speaker of the House of Representatives. He will serve the longest consecutive term as speaker.
Whenever I hear anyone arguing for slavery, I feel a strong impulse to see it tried on him personally. –Abraham Lincoln.

photos of the day

December 6, 2012

View of Et Si? Installation by artist Daniel Knipper is seen during the rehearsal for the ‘Festival of Lights’ in central Lyon, France, late Wednesday night. The festival, with designers from all over the world, is one of Lyon’s most famous and will run from December 6 to 9.

Robert Pratta/Reuters

A NASA handout released December 5 shows a composite image of Asia and Australia at night, assembled from data acquired by the Suomi NPP satellite in April and October 2012. The image was made possible by the satellite’s ‘day-night band’ of the Visible Infrared Imaging Radiometer Suite (VIIRS), which detects light in a range of wavelengths from green to near-infrared and uses filtering techniques to observe dim signals such as city lights, gas flares, auroras, wildfires and reflected moonlight.

NASA Earth Observatory/Reuters

 

Market Closes for December 6th, 2012:

 

Market  Index	Close	Change
Dow  Jones	13074.04	+39.55    +0.30%
S&P 500	1413.94	+4.66    +0.33%
NASDAQ	2989.266	+15.569    +0.52%
TSX	12151.13	-6.16
		-0.05%

International Markets

Market  Index	Close	Change
NIKKEI	9545.16	+76.32
		+0.81%
HANG  SENG	22249.81	-21.10
		-0.09%
SENSEX	19486.80	+94.94
		+0.49%
FTSE 100	5901.42	+9.34
		+0.16%

Bonds

Bonds	% Yield	Previous % Yield
CND.  10 Year Bond	1.695	1.687
CND.   30 Year Bond	2.302	2.295
U.S.   10 Year Bond	1.5857	1.5875
U.S.   30 Year Bond	2.7739	2.7770

Currencies

BOC Close	Today	Previous
Canadian $	0.99156	0.99191
US   $	1.00851	1.00815
Euro Rate  1 Euro=		Inverse
Canadian   $	1.28521	0.77808
US  $	1.29615	0.77152

Commodities

Gold	Close	Previous
London Gold   Fix	1699.83	1693.60
Oil	Close	Previous
WTI Crude Future	86.26	87.88
BRENT	108.45	110.23

Market Commentary:

Canada

By Eric Lam

Dec. 6 (Bloomberg) — Canadian stocks fell as bank shares slumped amid fourth-quarter earnings reports, overshadowing a jump in Loblaw Cos. after the company announced it will create a real estate investment trust.

Toronto-Dominion Bank and Canadian Imperial Bank of Commerce fell more than 0.5 percent after reporting results that included rising provisions for bad loans. Loblaw, Canada’s largest grocery chain by market value, soared the most in 25 years as it will sell units in the REIT in an initial public offering. Bombardier Inc. rose 1.5 percent after Delta Air Lines Inc. agreed to buy regional jets in a deal worth as much as $3.29 billion.

The Standard & Poor’s/TSX Composite Index lost 6.16 points, or 0.1 percent, to 12,151.13 in Toronto. The equity gauge has gained 1.6 percent this year. Trading volume was 27 percent higher than the 30-day average, according to data compiled by Bloomberg.

“Overall, the market is treading water. A lot of the direction is still being held hostage by the fiscal cliff,” said Luciano Orengo, a fund manager with Manulife Asset Management Ltd. in Toronto. His team manages about C$1.4 billion ($1.41 billion) in assets. “The headline stock today is Loblaw; I think people like that they’re unlocking the value in their real estate.”

In Washington, House Speaker John Boehner is under pressure as a few dozen Republicans have joined a bipartisan call to consider “all options” on taxes and entitlement programs in an effort to reach a budget compromise ahead of more than $600 billion in automatic tax increases and spending cuts scheduled for the new year.

Bank stocks lost the most in the S&P/TSX. Toronto-Dominion, the country’s second-largest lender, fell 1.8 percent to C$81.12. CIBC, the fifth-biggest bank, slipped 0.5 percent to C$80.14. National Bank of Canada, the No. 6 lender, dropped 1.4 percent to C$76.66.

Toronto-Dominion and CIBC posted profits that beat analysts’ estimates, helped by gains from their investment- banking units. National Bank of Canada matched estimates after posting a 20 percent earnings gain. Toronto-Dominion set aside C$565 million for bad loans, 66 percent more than a year ago, while CIBC had C$328 million in provisions, a 7.2 percent increase. National’s provisions fell 8 percent to C$46 million.

“The headlines beat, but when you look under the hood the quality of the beat wasn’t great,” said Manulife’s Orengo.

Loblaw surged 14 percent to C$38.20, its biggest gain since October 1987. The grocer said it plans to contribute about 35 million square feet of real estate with a current value of more than C$7 billion and plans to retain a “significant” majority interest, according to a statement today. The IPO is expected to be completed next year pending regulatory approvals and authorization to list on the TSX.

George Weston Ltd., which owns 60 percent of Loblaw, advanced 6.8 percent to C$67.71. Bombardier added 1.5 percent to C$3.33 after announcing it has sold 40 CRJ900 NextGen jets to Delta, along with options for 30 more aircraft.

The deal is Bombardier’s third major aircraft order in recent months. NetJets, a unit of Warren Buffett’s Berkshire Hathaway Inc., agreed to buy as many as 275 Challenger aircraft worth $7.3 billion in June, and luxury air-charter company VistaJet Holding SA ordered as many as 142 Global-series planes with a value of $7.8 billion in November.

DragonWave Inc., which sells wireless network equipment, lost 2.3 percent to C$2.16 after the company cut its forecast for third-quarter revenue to $39 million, from $43 million to $50 million previously. The stock pared earlier losses of as much as 16 percent.

The Ottawa-based company blamed the sales revision on “short-term supply challenges” that caused shipments to be delayed, as well as lower-than-expected orders from European customers.

US

By Rita Nazareth and Lu Wang

Dec. 6 (Bloomberg) — U.S. stocks rose for a second day as Apple Inc. rebounded from its biggest drop in four years and investors weighed prospects for a budget deal in Washington.

Apple advanced 1.6 percent, reversing an earlier loss.

Akamai Technologies Inc. increased 10 percent after agreeing to sell services with AT&T Inc. H&R Block Inc., the biggest U.S. tax preparer, advanced 5.1 percent after reporting a loss that was smaller than analysts estimated. Freeport-McMoRan Copper & Gold Inc., the world’s largest publicly traded copper producer, and MetLife Inc., the biggest U.S. life insurer, declined at least 1.2 percent following analysts’ rating downgrades.

The Standard & Poor’s 500 Index increased 0.3 percent to 1,413.94 at 4 p.m. New York time. The Dow Jones Industrial Average advanced 39.55 points, or 0.3 percent, to 13,074.04.

More than 5.7 billion shares changed hands on U.S. exchanges, or 8.9 percent below the three-month average.

“Apple stock is taking a breather after a sharp selloff and that’s helping the overall market,” said Alan Gayle, senior strategist at RidgeWorth Capital Management in Richmond, Virginia, which oversees about $47 billion. “Most analysts continue to like their story. We’re seeing some validation of that. In addition, the jobless claims were better than expected. The data suggest the U.S. economy continues to heal and that will be the case as long as we don’t fall off the fiscal cliff.”

A few dozen Republicans joined a bipartisan push to break an impasse between President Barack Obama and House Speaker John Boehner over taxes for the highest-earning Americans, signing a letter calling for openness to “all options.” Fewer Americans than projected filed applications for unemployment benefits last week as disruptions caused by superstorm Sandy waned.

Equities fell earlier as the European Central Bank forecast the economy will shrink 0.5 percent this year, more than the 0.4 percent contraction it predicted in September. The ECB cut its 2013 forecast to a contraction of 0.3 percent, and projected expansion of 1.2 percent in 2014. Risks to the outlook remain on the downside, ECB President Mario Draghi said.

“Weak activity is expected to extend into next year,” Draghi said at a press conference in Frankfurt after policy makers left the benchmark rate at a record low of 0.75 percent.

“Later in 2013, economic activity should gradually recover as global demand strengthens and our accommodative monetary-policy stance and significantly improved financial market confidence work their way through to the economy.”

The S&P 500 swung between gains and losses earlier today.

Intraday price fluctuations in the benchmark index averaged 0.8 percent over the past five days, the smallest since September, according to data compiled by Bloomberg.

“The market is showing not much conviction,” said Stephen Carl, head equity trader at Williams Capital Group LP in New York. “Fiscal cliff is on the forefront, stalling any moves at the moment. If there is a disparity one way or the other from tomorrow’s jobs report, you will probably see a move in the market.”

Data tomorrow is forecast to show U.S. payrolls rose by 85,000 workers last month, the smallest gain since June, according to the median forecast of economists.

Seven out of 10 groups in the S&P 500 rose today as technology and consumer discretionary shares had the biggest advances. Utilities and phone companies declined the most.

Apple rose 1.6 percent to $547.25, reversing an earlier decline of as much as 3.7 percent. It plans to spend more than $100 million next year on building Mac computers in the U.S., shifting a small portion of manufacturing away from China, the country that has handled assembly of its products for years.

The shares slumped 6.4 percent yesterday on concern that Apple will lose ground in smartphones to Nokia Oyj in China while giving up market share to Google Inc. in tablets. China Mobile Ltd. agreed to carry the Lumia 920T, a device based on Microsoft Corp.’s Windows Phone 8 software. In another announcement that may have fueled the stock’s slide, research firm IDC said yesterday that Apple’s share of the tablet market will slip to 53.8 percent this year from 56.3 percent in 2011, while Google’s will increase.

Akamai surged 10 percent to $39.06. The content-delivery services for AT&T’s business customers will be jointly sold and managed by both companies and be offered as a feature integrated into AT&T’s network, said Fletcher Cook, a spokesman for AT&T, the largest U.S. phone company. The contract is a multi-year, exclusive agreement, said Cook, who declined to disclose the terms.

H&R Block gained 5.1 percent to $18.26. The second-quarter results “reflect savings from our cost reduction initiatives and a strong tax season in Australia,” Chief Executive Officer Bill Cobb said in the statement.

Sirius XM Radio Inc. rose 0.7 percent to $2.79. The satellite-radio broadcaster said it will issue a special dividend of 5 cents a share and repurchase as much as $2 billion in stock.

Starbucks Corp. gained 5.7 percent to $53.70. The world’s biggest coffee-shop operator was raised to outperform from neutral at Robert W. Baird & Co. by analyst David Tarantino. The 12-month share-price estimate is $62.

Freeport-McMoRan dropped 4.2 percent to $30.81 after being downgraded to market perform from outperform at BMO Capital Markets and Macquarie Group Ltd.

The shares slumped 16 percent yesterday, the most in four years, after the mining company agreeing to buy Plains Exploration & Production Co. and McMoRan Exploration Co. for $9 billion. The move was criticized by BlackRock Inc., one of Freeport’s largest investors, and Dan Rohr, an analyst at Morningstar Investment Service, for failing to create any obvious cost savings.

MetLife declined 1.2 percent to $32.91. The shares were downgraded to equal-weight from overweight at Barclays Plc by analyst Jay Gelb. The share-price estimate is $37.

Traders are pushing the cost of protecting against J.C. Penney Co. swings to an all-time high relative to its competitors amid investor pessimism about Chief Executive Officer Ron Johnson’s turnaround plan.

Implied volatility, the key gauge of options prices, for three-month contracts closest to J.C. Penney shares has risen to 65.8, according to data through yesterday compiled by Bloomberg.

That is 3.3 times the level for the SPDR S&P Retail ETF, near the record reached last month. J.C. Penney, the fourth-largest U.S. department-store company, has lost 48 percent this year.

Johnson, who joined as chief executive officer about a year ago from Apple, is losing customers in a bid to implement an everyday low-pricing plan and turn the chain into a collection of branded shops. Revenue at J.C. Penney has declined by more than 20 percent for three straight quarters, sending the shares to their lowest price in almost four years. The company said earlier this week that its operating efficiency may be hurt after it fired employees while others left voluntarily.

“People are very focused on when the company will see some sort of bottom on the sales decline,” Jessica Bemer, a Sewickley, Pennsylvania-based senior analyst at Snow Capital Management LP, which oversees about $2.5 billion, said in a telephone interview yesterday. “The concern is that in order to be successful in that venture, the company will need to stabilize cash flow. It’s going to take some time to get there. How long are people going to wait?”

 

Have  a wonderful evening everyone.

 

Be magnificent!

 

Every day we see or read of appalling things happening in the world as the result of violence in man.

You may say, “I can’t do anything about it,” or “How can I influence the world?”

I think you can tremendously influence the world if you yourself are non violent,

if you lead actually every day a peaceful life – a life which is not competitive, ambitious, envious –

a life which does not create enmity.

Small fires can become ablaze.

Krishnamurti, 1895-1986

As ever,

 

Carolann

 

Fires can’t be made with dead embers, nor can enthusiasm be stirred

by spiritless men.   Enthusiasm in our daily work lightens effort and

turns even labor into pleasant tasks.

-James Baldwin, 1924-1987

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:

Today on my lunch break I was strolling through Chapter’s and came across a book that caught my attention. While reading the synopsis on the back, I had about three people approach me and tell me what a wonderful read this book was.  Even when I was at the counter paying for the book, it has a guarantee. What does that mean? Even if you read the book and are dissatisfied, Chapters will still refund you the original price of the book.  The name of this book is “Rules of Civility”. It’s set in New York City in 1938, and is the story of an uncompromising twenty-five-year-old named Katey Kontent. Armed with little more than a formidable intellect, a bracing wit, and her own brand of cool nerve, Katey embarks on a journey from a Wall Street secretarial pool through the upper echelons of New York society in search of a brighter future.  Throughout this book Katey will learn how individual choices become the means by which life crystallizes loss.

So next time you are in your local book store looking for a good read, check out Rules of Cilvility! Care for a good read?

 

“Go confidently in the direction of your dreams. Live the life you have imagined.” – Henry David Thoreau

 

And also on this day in…

1848 – U.S. President Polk triggered the Gold Rush of ’49 by confirming the fact that gold had been discovered in California.

1876 – The Stillson wrench was patented by D.C. Stillson. The device was the first practical pipe wrench.

1901 – Movie producer Walt Disney was born in Chicago. He created his first Mickey Mouse cartoon at the age of 27.
Disney movies, music and books

1904 – The Russian fleet was destroyed by the Japanese at Port Arthur, during the Russo-Japanese War.

1908 – At the University of Pittsburgh, numerals were first used on football uniforms worn by college football players.

1913 – Britain outlawed the sending of arms to Ireland.

1932 – German physicist Albert Einstein was granted a visa making it possible for him to travel to the U.S.

 

photos of the day December 5, 2012

People struggle against wind and drifting snow in Stockholm. Sweden’s main airport was paralyzed due to a snowstorm in the country’s capital, just as the winners of this year’s Nobel prizes were to arrive to receive their awards.

Anders Wiklund/Scanpix Sweden/Reuters

A man blows his trumpet from the Old Town Hall Tower as a Christmas tree is illuminated at the Old Town Square in Prague, Czech Republic.

David W Cerny/Reuters

 

Market Closes for December 5th, 2012:

 

Market  Index	Close	Change
Dow  Jones	13034.49	+82.71    +0.64%
S&P 500	1409.28	+2.23    +0.16%
NASDAQ	2973.697	-22.988    -0.77%
TSX	12157.29	+20.11
		+0.17%

International Markets

Market  Index	Close	Change
NIKKEI	9468.84	+36.38
		+0.39%
HANG  SENG	22270.91	+470.94
		+2.16%
SENSEX	19391.86	+43.74
		+0.23%
FTSE 100	5892.08	+23.04
		+0.39%

Bonds

Bonds	% Yield	Previous % Yield
CND.  10 Year Bond	1.687	1.698
CND.   30 Year Bond	2.295	2.301
U.S.   10 Year Bond	1.5875	1.6028
U.S.   30 Year Bond	2.7770	2.7770

Currencies

BOC Close	Today	Previous
Canadian $	0.99191	0.99275
US   $	1.00815	1.00730
Euro Rate  1 Euro=		Inverse
Canadian   $	1.29658	0.77126
US  $	1.30715	0.76502

Commodities

Gold	Close	Previous
London Gold   Fix	1693.60	1697.05
Oil	Close	Previous
WTI Crude Future	87.88	88.50
BRENT	110.23	111.08

Market Commentary:

Canada

By Nikolaj Gammeltoft and Eric Lam

Dec. 5 (Bloomberg) — Canadian stocks rose, snapping a two- day retreat, as optimism grew over U.S. budget talks and energy producers advanced following an easing of Chinese restrictions on investing in banks.

Primaris Retail Real Estate Investment Trust jumped 15 percent after real-estate investor KingSett Capital Inc. said it plans a C$4.4 billion ($4.4 billion) bid for the company.

Canadian Pacific Railway Ltd. added 4.1 percent after the company said it plans to shrink its workforce by 23 percent.

Suncor Energy Inc., the nation’s largest oil producer, rose 1.3 percent. Canadian Western Bank fell 0.9 percent after analysts with Macquarie and Canaccord Genuity downgraded the stock.

The Standard & Poor’s/TSX Composite Index rose 20.11 points, or 0.2 percent, to 12,157.29 in Toronto. The equity gauge has gained 1.7 percent this year.

“China is reversing the path it took a year ago to cool its economy,” said Barry Schwartz, fund manager with Baskin Financial Services in Toronto. His firm manages about C$450 million. “It looks like they’ll be in some kind of stimulus mode, so that helps the resources today.”

China’s regulators abolished a rule limiting insurers’ investments in commercial banks and Xinhua news agency said yesterday after a meeting of top party leaders that China will actively promote urbanization and expand domestic demand.

In U.S. budget talks, a few dozen Republicans have joined a bipartisan call to break the impasse between President Barack Obama and House Speaker John Boehner over taxes for the highest- earning Americans. The Republicans signed a letter calling for exploration of “all options” on taxes and entitlement programs, a signal that some rank-and-file members are ready to bargain.

Energy and financial stocks contributed most to gains in the S&P/TSX as nine of 10 industries advanced. Trading volume was 9.4 percent higher than the 30-day average, according to data compiled by Bloomberg.

Suncor added 1.3 percent to C$32.68 and Canadian Natural Resources Ltd. gained 1.3 percent to C$27.78.

Primaris jumped 15 percent to C$26.40 for its biggest gain since November 2008. The potential offer from KingSett Capital is worth C$26 per unit of Primaris, the Toronto-based real estate investor said in a statement today.

The S&P/TSX REIT Index rose 2.3 percent on the news, the biggest gain for the index since August 2011. Allied Properties REIT increased 4.4 percent to C$32.19 and Calloway REIT gained 3.2 percent to C$28.94.

Canadian Pacific rose 4.1 percent to C$96.82 after Chief Executive Officer Hunter Harrison said yesterday he plans to eliminate 4,500 jobs by 2016. The company also plans to shutter container-car terminals and will evaluate assets from its 2007 acquisition of Dakota, Minnesota & Eastern Railroad.

Canadian Western Bank fell 0.9 percent to C$27.74. Sumit Malhotra, analyst with Macquarie Research, lowered his rating to neutral from outperform while Scott Chan, analyst with Canaccord Genuity, cut his rating to hold from buy. The bank yesterday reported earnings that fell short of analysts’ estimates.

Canadian Western Bank has fallen 4.3 percent in the past two days.

Goldcorp Inc. dropped 3.3 percent to C$36.61 and Barrick Gold Corp. slipped 2.4 percent to C$33.12 as the price of the metal fell to its lowest in almost a month. Gold futures for February delivery fell 0.1 percent to $1,693.80 an ounce in New York.

US

By Lu Wang and Susanne Walker

Dec. 5 (Bloomberg) — U.S. stocks rose amid optimism lawmakers will reach a budget agreement before the end of the year to avoid automatic spending cuts and tax increases.

Treasuries climbed and the Dollar Index halted its longest slump in more than a year. Oil and gasoline slid on supply data.

The Standard & Poor’s 500 Index added 0.2 percent to 1,409.28 at 4 p.m. in New York after earlier slumping as much as 0.6 percent. Ten-year U.S. note yields lost one basis point to 1.59 percent and the Dollar Index increased 0.2 percent after declining for five days. Spain’s bonds extended losses after the government missed a maximum sales target at a debt sale.

A few dozen Republicans joined a bipartisan call to break the impasse between President Barack Obama and House Speaker John Boehner over taxes for the highest-earning Americans, signing a letter calling for exploration of “all options.”

Obama told a business group in Washington that “nobody wants to get this done more than me” and lawmakers probably could solve the budget debate in about a week if Republicans move.

“The President had a more positive tone with regard to a resolution of the fiscal cliff today,” said Rick Fier, director of equity trading at Conifer Securities LLC in New York. His firm oversees $8 billion in assets. “People expected the worst when he gets on the TV and he didn’t come across so negatively so the sellers stopped.”

Citigroup Inc. surged 6.3 percent for its biggest gain in almost a year, and diversified financial firms led gains among 24 industries in the S&P 500, after announcing it will eliminate more than 11,000 jobs and scale back operations in some emerging markets. Bank of America Corp. rallied 5.7 percent. Trading in the two stocks led to a surge in volume, according to Miller Tabak & Co. chief technical analyst Jonathan Krinsky. Volume of S&P 500 stocks was 22 percent higher than the 30-day average, data compiled by Bloomberg shows.

Travelers Cos., the insurer in the Dow Jones Industrial Average, jumped 4.9 percent after saying it is resuming share buybacks and projecting that superstorm Sandy will cost the company about $650 million. Plains Exploration & Production Co. jumped 23 percent and McMoRan Exploration Co. surged 87 percent as Freeport-McMoRan Copper & Gold Inc. agreed to acquire them for about $9 billion.

Apple Inc. slid 6.4 percent, the biggest drop in four years, and led the S&P 500’s earlier decline amid concern Nokia Oyj is getting a leg up in China. Market researcher IDC said the company’s share in the global tablet market will slip to less than half by 2016.

Two-year Treasury yields decreased less than one basis point to 0.24 percent and 30-year rates were little changed at 2.78 percent. Treasury 10-year yields were in a range of 22 basis points last month, according to data compiled by Bloomberg, the narrowest since April 2007. This month, the gap has been 5.6 basis points, or 0.056 percentage point.

The Stoxx Europe 600 Index closed up 0.2 percent, after rising as much as 0.4 percent. A gauge of mining companies surged to a four-week high as Anglo American Plc and Rio Tinto Group climbed at least 2.5 percent. Nokia Oyj rallied 9.7 percent as China Mobile Ltd. agreed to carry the Finnish mobile- phone maker’s flagship Lumia 920T smartphone.

Tesco Plc advanced 3.3 percent as the U.K.’s largest grocery company said it will likely leave the U.S. after announcing a review of its Fresh & Easy unit.

Europe’s equity benchmark will rally 11 percent by the end of the first quarter of 2013 if it breaks above a key resistance, according to Natixis. The Stoxx Europe 600 will climb as high as 307 if it crosses above 278, said Ouri Mimran, a technical strategist at Natixis in Paris. The immediate resistance represents the 50 percent Fibonacci retracement of the decline from July 2007 through March 2009 in the aftermath of the financial crisis.

Spain’s bonds plunged as the nation sold 4.25 billion euros ($5.56 billion) of bonds, less than the 4.5 billion-euro target.

Ten-year Spanish bonds increased 15 basis points to 5.40 percent. Italian 10-year securities dropped for the first time in seven days. German bunds advanced, while French, Belgian and Swiss 10-year rates dropped to record lows as investors sought the safest assets.

Energy commodities led losses in the S&P GSCI Index, with gasoline falling 1.9 percent and crude oil decreasing 0.7 percent to $87.88 a barrel after the U.S. Energy Department said gasoline stockpiles climbed more than forecast.

The MSCI Emerging Markets Index climbed 1.1 percent to the highest level on a closing basis since May. The Shanghai Composite Index increased 2.9 percent, the most since Sept. 7.

China’s regulators abolished a rule limiting insurers’ investments in commercial banks and Xinhua news agency said yesterday after a meeting of top party leaders that China will actively promote urbanization and expand domestic demand. Spain sold 4.25 billion euros ($5.6 billion) of debt due between 2015 and 2022, less than the 4.5 billion-euro target.

Russia’s Micex Index added 1.7 percent and Brazil’s Bovespa index increased 0.2 percent.

 

“Discipline is the bridge between goals and accomplishment.” – Jim Rohn

 

Have a wonderful evening everyone!!!!!

 

Be magnificent!

“Be kind whenever possible. It is always possible.” – Dalai Lama

 

Amanda Bourke

Assistant to Carolann Steinhoff

Queensbury Securities Inc.

 

St. Andrew’s Square

Suite 340A, 730 View St.,

Victoria, B.C. V8X 3Y7

Tel: 778-430-5808

Fax: 778-430-5838

 

 

Dear Friends,

 

Tangents:

 

The Poem

First Signs of Ageing

by John Burnside

 

Being was never my forte; cold red wine

and glimmer of herd instinct bearing me into a night

that any fool could travel, if he chose.

I much prefer the moment’s

absence, like the scent

of tulips in the hall and women calling

softly, from one landing to the next,

a moment since.

I never understood what they were saying,

but something they love

is retrieved from the huddle of knowing

again and again the justice of should-have-been

in place of what never was.

I think of them now as sisters, as I think

each footfall is a mirror where I keep

the secret I never told, a childhood game

persisting on the cold side of away –

and should-have-been a house

I know, the way a blind man knows the house

he lives in, blind from birth and every room

laid out for none to see, in steps and echoes.

 

On this day in 1980, Led Zeppelin announced it was disbanding after drummer John Bonham unexpectedly passed away. –Steven Russolillo, WSJ, 12/04/2012.

 

And also on this day in…

1835 – Samuel Butler, writer, was born.

1875 – Rainer Maria Rilke, poet, is born.

1942 – U.S. planes make the first raids on Naples, Italy.

1947 – Tennessee William’s play A Streetcar Named Desire premieres on Broadway starring Marlon Brando and Jessica Tandy.

1952 – The Grumman XS2F-1 makes its first flight.

1959 – Peking pardons Pu Yi, ex-emperor of China and of the Japanese puppet-state of Manchukuo.

1981 – President Ronald Reagan broadens the power of the CIA by allowing spying in the United States.

1991 – The last American hostages held in Lebanon are released.

 

Blow, blow, thou winter wind.  Thou art not so unkind.  As a man’s ingratitude.  –William Shakespeare.

photos of the day

December 4, 2012

Chalets are pictured in Barboleuse near the alpine ski resort of Villars-sur-Ollon. In March 2011, Switzerland accepted an initiative to limit the number of holiday homes to a 20 percent cap in every village in the country. The law will be enforced, beginning January 1, 2013.

Denis Balibous/Reuters

A woman stands in front of a doll display in a traditional Christmas market in Rome, Italy.

Tony Gentile/Reuters

 

Market Closes for December 4th, 2012:

 

Market  Index	Close	Change
Dow  Jones	12951.78	-13.82    -0.11%
S&P 500	1407.05	-2.41    -0.17%
NASDAQ	2996.685	-5.512    -0.18%
TSX	12137.18	-32.56
		-0.27%

International Markets

Market  Index	Close	Change
NIKKEI	9432.46	-25.72
		-0.27%
HANG  SENG	21799.97	+32.12
		+0.15%
SENSEX	19348.12	+42.80
		+0.22%
FTSE 100	5869.04	-2.20
		-0.04%

Bonds

Bonds	% Yield	Previous % Yield
CND.  10 Year Bond	1.698	1.711
CND.   30 Year Bond	2.301	2.306
U.S.   10 Year Bond	1.6028	1.6241
U.S.   30 Year Bond	2.7770	2.8065

Currencies

BOC Close	Today	Previous
Canadian $	0.99275	0.99457
US   $	1.00730	1.00546
Euro Rate  1 Euro=		Inverse
Canadian   $	1.30065	0.76884
US  $	1.31015	0.76327

Commodities

Gold	Close	Previous
London Gold   Fix	1697.05	1718.95
Oil	Close	Previous
WTI Crude Future	88.50	89.27
BRENT	111.08	111.85

Market Commentary:

Canada

By Nikolaj Gammeltoft and Eric Lam

Dec. 4 (Bloomberg) — Canadian stocks fell for a second day as energy shares slumped amid a decline in oil prices while the Bank of Canada maintained a bias to raise interest rates.

Canadian Natural Resources Ltd. retreated 2.6 percent as oil fell for the first time in four days. ShawCor Ltd., which provides coatings and other services to the pipeline industry, plunged 14 percent after the company said a sale was unlikely.

Bank of Montreal, Canada’s fourth-largest lender, rose 0.6 percent after reporting fourth-quarter profit that topped analysts’ estimates.

The Standard & Poor’s/TSX Composite fell 32.56 points, or 0.3 percent, to 12,137.18 in Toronto. The equity gauge has gained 1.5 percent this year.

“People have an understanding that the economy is weakening, so while there may be this bias toward raising I don’t think it will happen and the market can see through it,” said Robert McWhirter, fund manager with Selective Asset Management Inc. in Toronto. His firm manages about C$60 million ($60 million). “People are still trying to figure out where to go from here with regards to the fiscal cliff.”

Bank of Canada Governor Mark Carney kept his bias to raise interest rates, saying economic growth will accelerate next year after temporary disruptions in energy output and weak global demand curbed the country’s expansion. Canada’s gross domestic product slowed to a 0.6 percent annualized pace of growth in the third quarter, the slowest in more than a year.

The benchmark rate on overnight loans between commercial banks remained 1 percent, where it’s been for more than two years, and policy makers said a “small degree of slack” in the economy will gradually disappear, bringing inflation to the 2 percent target over the next 12 months. Today’s decision was expected by all 26 economists surveyed by Bloomberg News.

U.S. President Barack Obama said in a Bloomberg Television interview that a Republican offer on averting the so-called fiscal cliff doesn’t go far enough and won’t raise the revenue needed to shrink the deficit by $4 trillion over the next decade.

“We have the potential of getting a deal done,” Obama said at the White House today in his first television interview since winning re-election. “Unfortunately,” he said, House Speaker John Boehner’s proposal “right now is still out of balance.”

Crude for January delivery fell 0.7 percent as Republicans and Democrats try to avert more than $600 billion in automatic tax increases and spending cuts that start in January.

Energy companies contributed the most to losses in the S&P/TSX as seven out of 10 industries retreated. Trading volume was in line with the 30-day average.

Canadian Natural Resources dropped 2.6 percent to C$27.43 and Encana Corp. slipped 2.2 percent to C$21.14.

ShawCor plunged 14 percent to C$39.31, its biggest loss since March 2000, after the Toronto-based company said it’s “highly unlikely” that a sale of all of its shares will occur “at this time.” A special committee and the board are continuing to review strategic solutions, the company said in a statement yesterday. ShawCor had said on Sept. 5 it was considering selling itself.

Bank of Montreal added 0.6 percent to C$59.63 after the lender said fourth-quarter profit rose 41 percent on gains from investment banking and trading. The bank said earnings for the quarter were C$1.59 a share, up from C$1.11 a year earlier.

OceanaGold Corp. sank 8.1 percent to C$3.08 after the gold mining company, with projects in New Zealand and the Philippines, said yesterday it plans to raise C$93 million by selling 30 million shares to a group of investors at a discount.

The deal, expected to close Dec. 18, sells each share at C$3.11, a 7.1 percent discount to yesterday’s close.

The company plans to use the cash to reduce outstanding debt and provide balance sheet flexibility.

US

By Rita Nazareth and Lu Wang

Dec. 4 (Bloomberg) — U.S. stocks fell, sending the benchmark Standard & Poor’s 500 Index lower for a second straight day, after President Barack Obama held his ground about raising tax rates for the highest-income Americans.

Las Vegas Sands Corp. and Wynn Resorts Ltd. dropped at least 2.7 percent, joining a slump in Macau casinos, on speculation China may increase scrutiny of junket operators, who provide credit to high-stake gamblers. Intel Corp. advanced 2.2 percent on plans to sell bonds in a four-part offering to repurchase stock that’s trading at the lowest in 16 months.

The S&P 500 retreated 0.2 percent to 1,407.05 at 4 p.m. New York time. The Dow Jones Industrial Average fell 13.82 points, or 0.1 percent, to 12,951.78. More than 5.9 billion shares traded hands on U.S. exchanges, or 4.7 percent below the three- month average, according to data compiled by Bloomberg.

“The clock is ticking,” said Quincy Krosby, market strategist for Newark, New Jersey-based Prudential Financial Inc., which oversees more than 1 trillion. She spoke in a phone interview. “The focus is on what goes on in Washington. The market will be volatile. You’ve got to be very well hedged given that the market is so much headline-driven.”

U.S. President Obama’s administration rejected a Republican plan for tackling the fiscal cliff that omitted higher tax rates for top-earning Americans, leaving the issue unresolved with about four weeks left before more than $600 billion in tax increases and federal spending cuts start taking effect.

European stocks rose as finance ministers met to discuss moves to stem the debt crisis.

Obama said in a Bloomberg Television interview that the Republican offer on resolving the fiscal cliff doesn’t go far enough and won’t raise the revenue needed to shrink the deficit by $4 trillion over the next decade. Obama, in his first television interview since winning re-election, said, “We have the potential of getting a deal done.”

The president said he’s willing to make further cuts in entitlements and realizes he won’t get “100 percent” of what he wants. Still, he insisted that Republicans accept higher tax rates for top earners if the U.S. is to avoid automatic spending cuts and tax increases at the start of 2013.

“We’re going to have to have higher rates for the wealthiest,” Obama said today. “It’s just a matter of math.”

Casino shares tumbled. Police in mainland China and Macau have detained people from at least three of the biggest junket operators in recent weeks, the Wall Street Journal reported, citing people familiar with the situation. By acting as middlemen, junket operators help drive the VIP business that accounts for about two-thirds of casino revenue in the world’s largest gambling hub. Las Vegas Sands fell 2.8 percent to $45.46. Wynn Resorts dropped 2.9 percent to $110.12.

MetroPCS Communications Inc. sank 7.5 percent to $9.96. The company, which agreed to merge with T-Mobile USA Inc. in October, fell after Reuters reported that Sprint Nextel Corp. is unlikely to make a counteroffer.

Darden Restaurants Inc. fell 9.6 percent to $47.40. The owner of the Red Lobster and Olive Garden chains reported preliminary fiscal second-quarter profit of 25 cents to 26 cents a share, trailing analysts’ estimates. Chief Executive Officer Clarence Otis said the company’s promotions didn’t resonate with consumers and were affected by rivals’ offers.

Oshkosh Corp. lost 3.8 percent to $28.96. Billionaire activist investor Carl Icahn dropped his bid to buy Oshkosh after failing to receive enough shareholder support.

IAC/InterActiveCorp. declined 7.8 percent to $43.50. The Internet company founded by Barry Diller fell after Goldman Sachs Group Inc. cut its rating on the stock to sell.

Intel gained 2.2 percent to $19.97. The world’s largest semiconductor maker, whose attempt with Microsoft Corp. to combat Apple Inc.’s iPad in the $63.2 billion tablet market is getting off to a slow start, may issue five-year securities to yield about 80 basis points more than similar-maturity Treasuries, 10-year bonds at a relative yield of about 115 basis points, 20-year securities at about 135 basis points and 30-year debt at about 150, according to a person familiar with the offering.

Big Lots Inc. rose 12 percent to $31.27. The discount retailer boosted its earnings forecast, saying it now expects to earn as much as $3.05 a share this year. The company had projected profit of $2.95 at most.

Netflix Inc. rallied 14 percent to $86.65. The online video service signed a multiyear accord to carry Walt Disney Co. animated and live-action films, marking the first time a major studio has bypassed traditional cable-TV outlets.

Options traders are speculating the worst is over for Hewlett-Packard Co., pushing bearish contracts to the cheapest level in almost seven years.

Puts priced 10 percent below shares in the world’s largest computer maker cost 2.17 points more than calls betting on a 10 percent increase, according to three-month data compiled by Bloomberg. The price relationship known as skew fell to 1.54 on Nov. 26, the lowest since February 2006. Hewlett-Packard shares have lost 50 percent this year.

The stock is cheapest in at least four years after the company accused Autonomy Corp., the software maker it bought last year, of a broad range of financial falsehoods contributed to a $8.8 billion writedown. Hewlett-Packard Chief Executive Officer Meg Whitman is cleaning up the business and her strategy of paring product lines and cutting staff to make the company more competitive will benefit stock, according to Keith Trauner of GoodHaven Capital Management LLC.

“The stock appears significantly undervalued,” Trauner, a Miami-based money manager at GoodHaven Capital Management LLC, said in a phone interview. “Whitman’s strategies of foregoing large acquisitions, focusing on product design and development, and retooling the sales force are all sensible thoughts going forward.”

Have a wonderful evening everyone.

 

Be magnificent!

 

When there is space between you and the object you are observing

you well know there is no love, and without love, however hard you try to reform the world

or bring about a new social order or however much you talk about improvements,

you will only create agony.

So it is up to you.

Krishnamurti, 1895-1986

As ever,

 

Carolann

 

Science is what you know, philosophy is

what you don’t know.

-Bertrand Russell, 1872-1970

Carolann Steinhoff, B.Sc., CFP, CIM, FCSI

Senior Vice-President &

Senior Investment Advisor

Queensbury Securities Inc.,

St. Andrew’s Square

Suite 340A, 730 View St.,

Victoria, B.C. V8W 3Y7