Tangents: Carolann is away from the office today, I will be writing the newsletter on her behalf.
On this day, 1991 A hard-line coup against Soviet President Mikhail S. Gorbachev collapsed in the face of a popular uprising led by Russian federation President Boris Yeltsin. Go to article >>
Russia’s first lunar mission in decades ended in failure over the weekend when its Luna 25 spacecraft crashed into the moon’s surface. It was not immediately clear what caused the crash, but Roscosmos, Russia’s space agency, said the collision occurred after communication with the spacecraft was interrupted Saturday. The incident is a blow to Russia’s space ambitions as the uncrewed spacecraft was meant to complete Russia’s first lunar landing mission in 47 years. The country’s last lunar lander, Luna 24, landed on the moon on August 18, 1976. Luna 25 was years in the making and, if successful, would have marked a huge stride for the country’s civil space program — which has faced issues for decades.
2 male great white sharks have traveled thousands of miles together and no one knows why Although usually solitary animals, two juvenile great whites, nicknamed Simon and Jekyll, have been tracked traveling more than 4,000 miles together along the U.S. east coast. Read More
Bizarre ‘failed star’ the size of Jupiter is 2,000 degrees hotter than the sun This Jupiter-size object is 80 times denser than a planet and hotter than the sun. Full Story: Live Science (8/18)
PHOTOS OF THE DAY
Harare, Zimbabwe
Followers of the Stowdart sect of the Zion Church of God sing and dance during a service in the Mbare neighbourhood as Zimbabweans prepare to head to the polls to vote in general and presidential elections
Photograph: John Wessels/AFP/Getty Images
Istanbul, Turkey
Athletes take part in the Samsung Bosphorus intercontinental swimming race from Kanlıca to Kuruçeşme
Photograph: Dia Images/Getty Images
Sant Climent, Spain
A horse with a rider, or caixer, rears up during the traditional jaleo at the Sant Climent festival
Photograph: Matthias Oesterle/Shutterstock
Market Closes for August 21st, 2023
| Market Index |
Close | Change |
| Dow Jones |
34463.69 | -36.97 |
| -0.11% | ||
| S&P 500 | 4399.77 | +30.06 |
| +0.69% | ||
| NASDAQ | 13497.59 | +206.81 |
| +1.56% | ||
| TSX | 19784.87 | -33.52 |
| -0.17% |
International Markets
| Market Index |
Close | Change |
| NIKKEI | 31565.64 | +114.88 |
| +0.37% | ||
| HANG SENG |
17623.29 | -327.56 |
| -1.82% | ||
| SENSEX | 65216.09 | +267.43 |
| +0.41% | ||
| FTSE 100* | 7257.82 | -4.61 |
| -0.06% |
Bonds
| Bonds | % Yield | Previous % Yield |
| CND. 10 Year Bond |
3.777 | 3.716 |
| CND. 30 Year Bond |
3.592 | 3.530 |
| U.S. 10 Year Bond |
4.3379 | 4.2546 |
| U.S. 30 Year Bond |
4.4465 | 4.3751 |
Currencies
| BOC Close | Today | Previous |
| Canadian $ | 0.7384 | 0.7379 |
| US $ |
1.3543 | 1.3553 |
| Euro Rate 1 Euro= |
Inverse | |
| Canadian $ | 1.4757 | 0.6776 |
| US $ |
1.0896 | 0.9178 |
Commodities
| Gold | Close | Previous |
| London Gold Fix |
1893.70 | 1896.35 |
| Oil | ||
| WTI Crude Future | 80.72 | 81.25 |
Market Commentary:
📈 On this day in 1754, the inventor of coal-gas lighting, William Murdock, was born in Bellow Mill, Scotland. His invention enabled the streets of London—and soon thereafter, most of the world’s major cities—to be illuminated at night. For the first time, sunset didn’t have to mean darkness and human productivity and safety took a great leap forward.
Canada
By Bloomberg Automation
(Bloomberg) — The S&P/TSX Composite fell 0.2% at 19,784.87 in Toronto. The index dropped to the lowest closing level since June 27 after the previous session’s little change.
Canadian National Railway Co. contributed the most to the index decline, decreasing 0.9%. Tilray Brands Inc. had the largest drop, falling 6.1%.
Today, 144 of 227 shares fell, while 79 rose; 9 of 11 sectors were lower, led by financials stocks.
Insights
* This month, the index fell 4.1%
* The index declined 1.6% in the past 52 weeks. The MSCI AC Americas Index gained 3.5% in the same period
* The S&P/TSX Composite is 5.1% below its 52-week high on Feb. 2, 2023 and 10.7% above its low on Oct. 13, 2022
* The S&P/TSX Composite is down 2.5% in the past 5 days and fell 3.7% in the past 30 days
* S&P/TSX Composite is trading at a price-to-earnings ratio of 12.9 on a trailing basis and 13.9 times estimated earnings of its members for the coming year
* The index’s dividend yield is 3.4% on a trailing 12-month basis
* S&P/TSX Composite’s members have a total market capitalization of C$3.14t
* 30-day price volatility rose to 10.84% compared with 10.82% in the previous session and the average of 10.68% over the past month
================================================================
| Index Points | | Sector Name | Move | % Change | Adv/Dec
================================================================
Financials | -31.1681| -0.5| 6/22
Industrials | -14.6845| -0.5| 3/22
Energy | -7.9391| -0.2| 11/28
Utilities | -7.6304| -0.9| 1/15
Real Estate | -6.9735| -1.5| 1/20
Consumer Staples | -4.7725| -0.6| 0/11
Consumer Discretionary | -1.2077| -0.2| 4/9
Health Care | -1.1302| -1.8| 1/3
Communication Services | -0.4255| -0.1| 2/3
Information Technology | 19.3235| 1.4| 9/2
Materials | 23.0828| 1.0| 41/9
================================================================
| | |Volume VS | YTD | Index | | 20D AVG | Change Top Contributors |Points Move| % Change | (%) | (%)
================================================================
Canadian National | -5.8840| -0.9| -20.2| -5.2
TD Bank | -4.8690| -0.5| -19.8| -4.7
Suncor Energy | -4.5830| -1.1| 22.0| 3.2
Constellation | | | |
Software | 5.3030| 1.5| 21.1| 29.5
Cameco | 5.6980| 4.0| 27.0| 59.1
Shopify | 9.0670| 1.5| -26.0| 55.4
* The benchmark 10-year bond fell and the yield rose 6.1 basis points to 3.777%
* The S&P 500 Index advanced 0.7%
US
By Rita Nazareth
(Bloomberg) — A rally in big tech spurred a rebound in stocks, outweighing concerns over higher Treasury yields just a few days ahead of a speech by Federal Reserve Chair Jerome Powell.
The S&P 500 halted a four-day drop while the Nasdaq 100 rose about 1.5%, with Tesla Inc. up the most since March. Nvidia Corp., which helped ignite the artificial-intelligence frenzy that has driven this year’s equity surge, jumped over 8%. The chipmaker’s results are due Wednesday, and revenue is seen rising 65% from a year earlier, according to data compiled by Bloomberg.
“This is a big week for tech stocks, and optimism is brewing that Nvidia will deliver some good results,” said Ed Moya, senior market analyst for the Americas at Oanda. “Will Nvidia’s earnings reignite the AI trade and provide much needed relief to tech stocks?”
In late hours, SoftBank Group Corp. semiconductor unit Arm filed for what is set to be this year’s largest US initial public offering. Zoom Video Communications Inc. rallied on a bullish forecast. Charles Schwab Corp. is planning to cut at least $500 million in annual staff, professional services and real estate costs in the latest step by the brokerage to respond to investor pressure.
Bonds resumed their selloff as signs of economic strength bolstered bets on still elevated rates. The yield on 10-year inflation-protected Treasuries pushed over 2% for the first time since 2009. Not long after, the yield on 10-year notes without that protection hit a level last seen in late 2007. Just because real yields have climbed, it doesn’t mean the scenario for stocks is necessarily bad, according to Bespoke Investment Group. Since 1997, average forward returns for equities when real yields hit 52-week highs were just modestly worse than all periods, the strategists wrote. In addition, new highs for real yields broadly tend to lead to pockets of stronger earnings-per-share growth, they noted. “That’s consistent with the view that high real yields represent a stronger economy, even if that has some negative implications for asset price valuation,” Bespoke strategists said.
Powell will speak Friday at the Kansas City Fed’s Jackson Hole Economic Policy Symposium after officials last month lifted rates to a range of 5.25% to 5.5%, the highest level in 22 years. Minutes from the gathering showed policymakers still saw significant risks that inflation could remain higher than they expect — which could keep rates elevated.
“Traders will be sifting every sentence from Jerome Powell at this week’s Jackson Hole conference for clues about the Fed’s disposition,” said Chris Larkin, managing director of trading and investing at E*Trade from Morgan Stanley. “Some investors may have focused on the reality that this economic resilience may extend the Fed’s higher-for-longer stance on interest rates.”
In fact, two-thirds of 602 respondents in Bloomberg’s latest Markets Live Pulse survey say the Fed has yet to conquer inflation. And over 80% of those surveyed said Powell’s Jackson Hole speech will reinforce the message of a hawkish hold.
“The Fed and investors will soon pivot from a focus on how high the policy rate will go to a concern about how long they will stay at that level — and what the implications are for a ‘higher for longer’ scenario,” said Katie Nixon, chief investment officer for the wealth management business at Northern Trust. “In our view, Powell will want to stay on message, and will try to push back against a growing market consensus that rate cuts are on the 2024 horizon.”
The speeches from Fed chiefs at the Jackson Hole conference have typically buoyed stocks since the turn of the millennium, with the S&P 500 gaining 0.4% on average in the following week, data compiled by Bloomberg Intelligence show. But last year’s appearance is still fresh in traders’ minds: Equities slumped 3.2% in the week following Powell’s remarks, according to BI, after he warned of keeping policy
restrictive to battle inflation.
Meantime, two of Wall Street’s top strategists are at odds about the outlook for US stocks following a three-week run of declines as debate rages over whether the economy can avoid a recession.
While Morgan Stanley’s Michael Wilson — a stalwart equity bear — says sentiment is likely to weaken further if investors are starting to “question the sustainability of the economic resiliency,” his counterpart at Goldman Sachs Group Inc., David Kostin, says there’s room for investors to further increase exposure if the economy stays on course for a soft landing.
A bruising August is still poised to end a five-month winning streak for equities. Yet there have been few signs of outright bearishness in the recent rout. Hedge funds and other large speculators narrowed their net- short positions in S&P 500 futures to the smallest in 14 months, according to the latest batch of Commodity Futures Trading Commission data Friday. And analysts say the drop this month may be a welcome break from the steep gains that pushed valuations to lofty levels.
Key events this week:
* US existing home sales, Tuesday
* Chicago Fed’s Austan Goolsbee speaks, Tuesday
* Eurozone S&P Global Services & Manufacturing PMI, consumer confidence, Wednesday
* UK S&P Global / CIPS UK Manufacturing PMI, Wednesday
* US new home sales, S&P Global Manufacturing PMI, Wednesday
* US initial jobless claims, durable goods, Thursday
* Kansas City Fed’s annual economic policy symposium in Jackson Hole begins, Thursday
* Japan Tokyo CPI, Friday
* US University of Michigan consumer sentiment, Friday
* Fed Chair Jerome Powell, ECB President Christine Lagarde to address Jackson Hole conference, Friday
Some of the main moves in markets:
Stocks
* The S&P 500 rose 0.7% as of 4 p.m. New York time
* The Nasdaq 100 rose 1.6%
* The Dow Jones Industrial Average fell 0.1%
* The MSCI World index rose 0.4%
Currencies
* The Bloomberg Dollar Spot Index was little changed
* The euro rose 0.2% to $1.0896
* The British pound rose 0.2% to $1.2759
* The Japanese yen fell 0.6% to 146.22 per dollar
Cryptocurrencies
* Bitcoin fell 0.4% to $26,124.17
* Ether fell 1% to $1,673.25
Bonds
* The yield on 10-year Treasuries advanced eight basis points to 4.34%
* Germany’s 10-year yield advanced eight basis points to 2.70%
* Britain’s 10-year yield advanced five basis points to 4.73%
Commodities
* West Texas Intermediate crude fell 0.6% to $80.80 a barrel
* Gold futures rose 0.4% to $1,923.70 an ounce
This story was produced with the assistance of Bloomberg Automation.
–With assistance from Brett Miller, Tassia Sipahutar, John Viljoen, Sagarika Jaisinghani, Isabelle Lee and Heather Burke.
Have a lovely evening.
Be magnificent!
As ever,
Isabel
Not all those who wander are lost. – J. R. R. Tolkien, 1892-1973
Assistant to Carolann Steinhoff, Registered Representative
Queensbury Securities Inc.,
St. Andrew’s Square,
Suite 340A, 730 View St.,
Victoria, B.C. V8W 3Y7
Tel: 778.430.5808
(C): 250.881.0801
Toll Free: 1.877.430.5895
Fax: 778.430.5828
www.carolannsteinhoff.com
