Category: Newsletters

Dear Friends,

Tangents:

On this day in…

1938, “Kristallnacht”, Germany.

1942, James Agate wrote in his diary [Ego] (The Torch landings at Casablanca, Algiers and Oran had taken place the day before):
A glorious day, in every sense of the word.  Alexander’s great victory [Alamein] and the invasion by Americans of French North Africa have put the people of this country into better fettle than they have known since 1925, when, at Melbourne on the third day of the second Test Match, Hobbs and Sutcliffe put on 283 runs for England’s first wicket and sent the Stock Exchange up two points.

1989, the fall of the Berlin Wall begins as citizens begin demolishing the wall and East German government opens 10 new border crossings.
PHOTOS OF THE DAY

A street performer dressed as the Statue of Liberty holds photos of US presidential candidates Donald Trump and Hillary Clinton at the financial Central district in Hong Kong on Wednesday after Trump won the presidency. Bobby Yip/Reuters

Water droplets cover a fallen leaf in Tiergarten central park in Berlin on Wednesday. Fabrizio Bensch/Reuters
Market Closes for November 9^th, 2016

Market Index	Close	Change
Dow Jones	18589.69	+256.95   +1.40%
S&P 500	2163.26	+23.70   +1.11%
NASDAQ	5251.074	+57.585   +1.11%
TSX	14759.91	+103.07
		+0.70%

International Markets

Market Index	Close	Change
NIKKEI	16251.54	-919.84
		-5.36%
HANG SENG	22415.19	-494.28
		-2.16%
SENSEX	27252.53	-338.61
		-1.23%
FTSE 100	6911.84	+68.71
		+1.00%

Bonds

Bonds		% Yield		Previous  % Yield
CND. 10 Year Bond		1.371		1.273
CND. 30 Year Bond		2.020		1.913
U.S.    10 Year Bond		2.0644		1.8565
U.S. 30 Year Bond		2.8541		2.6156

Currencies

BOC Close	Today	Previous
Canadian $	0.74507	0.75278
US $	1.34216	1.32841
Euro Rate 1 Euro=		Inverse
Canadian $	1.46498	0.68260
US $	1.09151	0.91616

Commodities

Gold	Close	Previous
London Gold Fix	1281.40	1282.35
Oil	Close	Previous
WTI Crude Future	45.27	44.98

Market Commentary:
Numbers of the Day
9.4%

The percentage decline in the Mexican peso against the U.S. dollar.
29% 

The percentage of both Hispanic and Asian voters that Mr. Trump was on track in exit polls to draw, defying expectations that his support among minority groups would collapse because of his disparaging remarks about illegal immigrants from Mexico and proposal to ban the entry of Muslims to the U.S. 

Canada
By Eric Lam
     (Bloomberg) — Canadian stocks joined surging markets around the world as investors bet U.S. President-Elect Donald Trump would move ahead with pro-growth policies, buoying the country’s natural-resource producers.
     The S&P/TSX Composite Index added 0.7 percent to 14,759.91 at 4 p.m. in Toronto, joining U.S. stocks in rising after the Republican’s election upset on Tuesday night. Surge Energy Inc. and Canadian Energy Services & Technology Co. jumped at least 6.5 percent as energy companies led gains in the equity benchmark.
     “I don’t think this is the end of the world, or even the beginning of the end of the world,” said Tom Caldwell, chief executive officer at Caldwell securities Ltd., which manages about C$1.5 billion ($1.1 billion). “The best way to undercut a revolution is to give the revolutionaries power, because they have to confront what is doable. That will moderate Trump along with his advisers.”
     Just what exactly Trump intends to do with the power he’s won — and how closely that lines up with his campaign rhetoric — will be revealed over the coming months, leaving no shortage of uncertainty for equity investors to navigate. Canada’s manufacturing base, for instance, is vulnerable as Trump may push to change the long-standing North American Free Trade Agreement, Caldwell said.
     Trump campaigned on a pledge to renegotiate or potentially end NAFTA, a pact that has existed between Canada, the U.S. and Mexico since 1994 and has been a boon to the Canadian economy.                         
     The U.S. is Canada’s largest trading partner, purchasing about three quarters of all Canadian exports worth almost C$400 billion in 2015 according to Statistics Canada data. The U.S. is also the biggest foreign investor in Canada, with C$388 billion in investment, or about half of all foreign direct investment. Canada invested about C$449 billion in the U.S. in 2015, the main destination for funds.
     Companies that derive significant revenue from south of the border declined, as auto-parts supplier Magna International Inc., which lost 3.9 percent for its biggest drop since July. West Fraser Timber Co., which got 55 percent of its revenue from the U.S. in 2015, fell 6.6 percent.
     Canada’s big banks and energy producers will be fine, especially if TransCanada Corp. wins approval for Keystone XL under a Trump presidency, Caldwell said. TransCanada jumped 3 percent, its biggest gain since January, on hopes Trump would move to approve the company’s pipeline from the oil sands to the U.S. Gulf Coast.
     “Keystone looks like a key positive,” said Stephen Lingard, portfolio manager with Franklin Templeton Solutions, a unit of Franklin Templeton Investments. Lingard and his team oversee C$9.5 billion in Canada, and the firm manages $733 billion globally. “If that gets re-opened, that’s a benefit for the oil and gas sector, which frankly needs a lifeline given how tough the fundamentals have been.”
     Lingard said he was surprised volatility isn’t higher, and that may have to do with Trump’s conciliatory tone after his victory.
     “I do think a lot of his initial message on being very conciliatory, more statesman-like than populous has played a role in this fairly muted market reaction,” he said. “You didn’t know which Trump would show up.”
     Raw-materials producers added 1.7 percent as a group as gold surged overnight the most since Britain’s Brexit vote in June, before paring gains. Canadian producer Barrick Gold Corp. advanced 1 percent. HudBay Minerals Inc., which produces zinc and copper, rose 4.2 percent as industrial metals also advanced.
     “The gold guys will love this,” Paul Conibear, chief executive officer, Lundin Mining Corp., said in a phone interview. Lundin surged 6.8 percent. “Gold historically has already worked best as a safe haven when there’s uncertainty on the U.S. dollar, uncertainty on world economies.”
     Kash Pashootan, fund manager at First Avenue Advisory in Toronto, planned to deploy at least 5 percentage points of the 20 percent cash position he had built up in his portfolios today depending on how the markets reacted. 
     “Certainly we view this as a buying opportunity,” he said. “Be selective, as volatility isn’t a one-day event.”
     Pashootan is targeting some of his own dividend-paying holdings that have recently pulled back, including Aecon Group Inc. as well as interest-rate plays Enbridge Inc., BCE Inc. and Emera Inc. as the Federal Reserve may now hold off on raising interest rates in December after the surprise election results, he said.
US
By Anna-Louise Jackson
     (Bloomberg) — U.S. stocks rose in heavy trading, with the Dow Jones Industrial Average briefly eclipsing its all-time closing high, as shares of banks to heavy equipment manufacturers rallied amid speculation Donald Trump will pursue business-friendly policies.
     Health-care shares and lenders surged as investors unwound bets that a win by Hillary Clinton would bring stronger regulatory scrutiny. The SPDR S&P Biotech exchange-traded fund rose the most since 2008, while Pfizer Inc. and Merck & Co. jumped at least 6 percent. JPMorgan Chase & Co. rose 4.6 percent to a record, and Goldman Sachs Group Inc. had its best one-day gain in 4 1/2 years.
     The S&P 500 Index rose 1.1 percent to 2,163.26 at 4 p.m. in New York, extending its advance after rising above its average prices during the past 50 and 100 days. The Dow climbed 256.95 points, or 1.4 percent, to 18,589.69, a two-month high. The Nasdaq Composite Index added 1.1 percent, and the Russell 2000 Index increased 3.1 percent, its best since January. About 12 billion shares traded on U.S. exchanges, 80 percent more than the three-month average and the most since the Brexit selloff in June.
     “Our base case is we’re more likely to see a more moderate president than we saw as a candidate and the market’s agreeing with that,” said Lowell Yura, head of multi-asset solutions for BMO Global Asset Management in Chicago, which oversees $238 billion. “We don’t see a huge impact to short-term earnings and short-term economic growth.”
     An early knee-jerk selloff in global stocks and a rally in haven assets reversed on wagers that Trump would increase fiscal spending to spur economic growth, and as he struck a more conciliatory tone in his first speech as president-elect. The CBOE Volatility Index tumbled 23 percent Wednesday, the most in five years, as the measure of market turbulence retreated from a four-month high reached on Friday.
     A Trump victory had been portrayed by analysts as having the potential to unhinge markets banking on a continuation of policies that coincided with the second-longest bull market in S&P 500 history. While Republican control of both houses of Congress may enable the party to enact sweeping legislation that would be considered pro-business, concern persists over the impact from Trump’s pledges to clamp down on immigration to the U.S. and renegotiate free-trade agreements with countries including Mexico.
     “People focus on the fact that his acceptance speech kind of changed the direction of the market,” said Krishna Memani, New York-based chief investment officer at Oppenheimer Funds Inc., which oversees $223 billion. “It was far more conciliatory and far more fiscal-focused than these acceptances typically are — that made a world of difference.”
     A basket of stocks identified by Morgan Stanley as most likely to benefit from a Trump win surged 6.4 percent. The group includes 53 companies ranging from drugmaker Alexion Pharmaceuticals Inc. to construction-materials producer Martin Marietta Materials Inc. Among the S&P 500’s 11 main groups, financials rose 4.1 percent, while utilities sank 3.7 percent, the first time since 2009 that the biggest industry winner and loser moved more than 3 percent during a single day.
     Among other shares boosted by the Republican’s win, prison operators soared on speculation the new administration will rescind a government contract phase-out. Corrections Corp. and Geo Group Inc. jumped more than 21 percent.
     Companies gaining on Trump’s plans to boost infrastructure spending included equipment provider United Rentals Inc., which capped its steepest advance in almost eight years, while Caterpillar Inc. added 7.7 percent, the most since 2011. Vulcan Materials Co. climbed 10 percent to an all-time high.
     Along with the potential for a lighter regulatory burden, banks were also boosted by soaring bond yields as investors’ inflation expectations climbed on speculation a Trump administration and Republican Congress will ramp up spending to lift growth. Investors wagered higher rates will bolster financials’ earnings, sending Wells Fargo & Co. and Bank of America Corp. up more than 5.3 percent, with the former jumping the most since 2012.
     Click here for more on the winners and losers after the Trump victory.
     Wednesday’s action was a far cry from the dour sentiment overnight as investors sent equity futures tumbling when it became clear Trump would pull off a historic upset. S&P 500 futures plunged by the maximum 5 percent loss permitted on the Chicago Mercantile Exchange before trading curbs were triggered, then pared their decline to less than 1 percent by today’s open.
     When things last night looked most grim, at least one billionaire investor was willing to step in to buy. Carl Icahn left President-elect Trump’s victory party in the early hours of the morning to bet about $1 billion on U.S. equities, he said today in an interview on Bloomberg TV. “I thought it was absurd that the market, the S&P was down 100 points on Trump getting elected,” Icahn said in a phone interview.
     Companies potentially sensitive to Trump’s trade plans retreated Wednesday. Coca-Cola Co. and Procter & Gamble Co. decreased at least 1.4 percent to weigh on consumer staples. Hospital operators Tenet Healthcare Corp. and HCA Holdings Inc. tumbled more than 10 percent on speculation the new president will move to repeal Obamacare.
     The S&P 500 rose for a third session for the first time since September, with the gains putting it on track for the best week in two years. A rally was sparked Sunday night by news the FBI had resolved its investigation of Clinton’s e-mails. Heading into yesterday’s vote, most polls had the Democratic candidate ahead by several points. The benchmark increased 2.6 percent on Monday and Tuesday, its third-biggest ever in the two days before a presidential election, following its longest selloff in 36 years.
     As the initial turbulence eased, odds for a Federal Reserve interest-rate hike in December climbed back to levels seen before Trump’s victory, after plunging below 50 percent while the outcome unfolded. The market-implied chance of a move next month is 86 percent, the same as the probability on Tuesday afternoon.
     “The U.S. that Trump inherits is doing pretty well economically,” said Nandini Ramakrishnan, a strategist at JPMorgan Asset Management in London. “From an investment perspective, this is not something that we would say is entirely negative as the market may see just this morning. There may be potential opportunities with some of these selloffs.”
     Regardless of Wednesday’s rally, next-day moves in the S&P 500 are useless in telling what comes after, as gains or losses over the first 24 hours predict the market’s direction 12 months later less than half the time. In the 22 elections going back to 1928, the S&P 500 has fallen 15 times the day after polls close, for an average loss of 1.8 percent. Stocks reversed course and moved higher over the next 12 months in nine of those instances, according to data compiled by Bloomberg.

    

Have a wonderful evening everyone.

 

Be magnificent!

Free yourself from anger and desire, which are the causes of sin and conflict,
and thereby make yourself whole.  This is the essence of yoga;
this is the means by which you come to know the soul, and thereby attain the highest spiritual state.
Learn to meditate.  Close your eyes; clam your breathing; and focus your attention
on the center of consciousness.  Thus you will master the senses, the emotions, and the intellect –
and thereby free yourself from desire and anger.
The Bhagavad Gita

As ever,

 

Carolann

 

In democracy it’s your vote that counts.  In feudalism it’s your count that votes.
                                                                                  -Mogens Jallberg

 

Carolann Steinhoff, B.Sc., CFP®, CIM, CIWM
Portfolio Manager &
Senior Vice-President

Queensbury Securities Inc.,
St. Andrew’s Square,
Suite 340A, 730 View St.,
Victoria, B.C. V8W 3Y7

 
Tel: 778.430.5808
(C): 250.881.0801
Toll Free: 1.877.430.5895
Fax: 778.430.5828
www.carolannsteinhoff.com

Dear Friends,

Tangents:

My November Guest

My Sorrow, when she’s here with me,
Thinks these dark days of autumn rain
Are beautiful as days can be;
She loves the bare, the withered tree;
She walked the sodden pasture lane.

Her pleasure will not let me stay.
She talks and I am fain to list:
She’s glad the birds are gone away,
She’s glad her simple worsted gray
Is silver now with clinging mist.

The desolate, deserted trees,
The faded earth, the heavy sky,
The beauties she so truly sees,
She thinks I have no eye for these,
And vexes me for reason why.

Not yesterday I learned to know
The love of bare November days
Before the coming of the snow,
But it were vain to tell her so,
And they are better for her praise.

Robert Frost 

PHOTOS OF THE DAY

Kenyan comedians prepare villagers for a mock-vote for the 2016 US presidential elections in the ancestral home of President Barack Obama in Nyangoma Kogelo, west of Kenya’s capital Nairobi, on Tuesday. Moses Eshiwani/Reuters

Lucas Museum of Narrative Art (LMNA) registrar Nicole Manis unpacks the Yoda puppet, used in the original movies, at the Star Wars Identities exhibition at the 02 in London on Tuesday. Dylan Martinez/Reuters

An actress dressed in a period costume walks through the snow in St. Petersburg, Russia, on Tuesday. Dmitri Lovetsky/AP
Market Closes for November 8^th, 2016

Market Index	Close	Change
Dow Jones	18332.74	+73.14   +0.40%
S&P 500	2139.53	+8.01   +0.38%
NASDAQ	5193.488	+27.315   +0.53%
TSX	14656.84	+4.39
		+0.03%

International Markets

Market Index	Close	Change
NIKKEI	17171.38	-5.83
		-0.03%
HANG SENG	22909.47	+108.07
		+0.47%
SENSEX	27591.14	+132.15
		+0.48%
FTSE 100	6843.13	+36.23
		+0.53%

Bonds

Bonds		% Yield		Previous  % Yield
CND. 10 Year Bond		1.273		1.221
CND. 30 Year Bond		1.913		1.871
U.S.    10 Year Bond		1.8565		1.8261
U.S. 30 Year Bond		2.6156		2.6021

Currencies

BOC Close	Today	Previous
Canadian $	0.75278	0.74797
US $	1.32841	1.33695
Euro Rate 1 Euro=		Inverse
Canadian $	1.46324	0.68342
US $	1.10149	0.90786

Commodities

Gold	Close	Previous
London Gold Fix	1282.35	1283.05
Oil	Close	Previous
WTI Crude Future	44.98	44.89

Market Commentary:
Number of the Day
129.1 million
About 129.1 million people cast votes in the 2012 presidential election, according to Pew Research, about 53.6% of the voting-age population. That percentage ranked 31st out of the 35 countries in the Organization for Economic Cooperation and Development.
Canada
By Eric Lam
     (Bloomberg) — Canadian stocks ended the day slightly higher, giving back earlier gains as investors waited to see the results of the U.S. presidential election.
     The S&P/TSX Composite Index added 4 points to 14,656.84 at 4 p.m. in Toronto all but erasing a gain of 0.4 percent. The equity benchmark rallied the most in three weeks Monday, and is now up 13 percent in 2016, the top performer among developed markets tracked by Bloomberg. Canadian stocks are now 12 percent more expensive than their peers in the S&P 500 Index.
     In the U.S., equities rose a second day, adding to the strongest rally in eight months as voters headed to the polls with Democrat Hillary Clinton holding a narrow lead in most pre- election surveys. Donald Trump continued to hold out on whether he would accept the results of the election. The S&P 500 Index gained 0.4 percent in New York, capping its biggest back-to-back gain since June.
     Raw-materials producers and lenders led the gainers in the index while energy producers ended the day down 0.2 percent. Oil traded near $45 a barrel in New York, little-changed after advancing the most in more than two weeks Monday. OPEC increased its forecast for global oil demand next year, anticipating cheaper crude will spur increased consumption.
     Teck Resources Ltd. rose 2.6 percent, to the highest close in three years, as spot metallurgical coal topped $300 a metric ton for the first time since flooding in Australia curbed output five years ago. Teck is the best-performing stock in the S&P/TSX this year with a more than five-fold increase.
     Health-care shares plunged with Valeant Pharmaceuticals International Inc. warning of more possible surprises for investors. Valeant tumbled 22 percent to the lowest level in six years. New management at the struggling drug maker cut the company’s annual profit forecast to well below estimates after reporting a $1.22 billion net loss on writedowns of some of its U.S. businesses. Paul S. Herendeen, the new chief financial officer, warned there may be further surprises in store for investors. Valeant shares have plunged 86 percent this year.
     Health-care is the worst-performing industry among the 11 groups in the S&P/TSX this year, plummeting 78 percent as shares of Valeant and smaller peer Concordia International Corp. have lost most of their market value. The drugmaking industry has come under intense scrutiny over the past year for skyrocketing pharmaceutical prices and become the focus of government investigations. Concordia lost 10 percent for a fourth day of losses, trading at the lowest in three years.
US
By Joseph Ciolli and Rebecca Spalding
     (Bloomberg) — U.S. stocks advanced, with the S&P 500 Index posting its best two-day climb since June, as investors awaited election results amid a tight contest for president.
     The S&P 500 rose 0.4 percent to 2,139.56 at 4 p.m. in New York, after erasing a 0.4 percent slide, to close at a two-week high. The gauge climbed as much as 0.7 percent. The Dow Jones Industrial Average added 73.14 points, or 0.4 percent, to 18,332.74, and the Nasdaq Composite Index climbed 0.5 percent. About 7 billion shares traded hands on U.S. exchanges, 6 percent more than the three-month average.
     “There’s still a relief rally occurring following yesterday’s big gain,” said Bill Schultz, who oversees $1.2 billion as chief investment officer of McQueen, Ball & Associates Inc. in Bethlehem, Pennsylvania. “Clinton represents less change, and positive news for her will be a positive for the market. Any uncertainty removed from an outlook is always good.”
     The main benchmark for U.S. equity continued to climb after surging the most in eight months yesterday. The FBI on Sunday reiterated that Hillary Clinton’s controversial handling of her e-mails wasn’t a crime, bolstering speculation on her chances for victory in the election. The CBOE Volatility Index edged higher today after halting on Monday its longest streak of gains ever.
     A provider of real-time analysis of voter turnout estimates that Clinton has earned more early votes than Republican Donald Trump in battleground states including Florida, Iowa and Nevada. Analysis by Slate.com’s Votecastr showed Trump trailing in Pennsylvania after holding an earlier lead.
     Votecastr is using an unproven technique to deliver real- time updates on voter turnout in combination with polling done ahead of Election Day. The site says its information is not making a prediction on who will win any states.
     Clinton and Trump have spent the past days campaigning in key states as polls showed the race had tightened. State-by- state surveys indicate a narrow lead for the Democratic candidate, while websites that take bets on the presidential victor show her odds of winning the White House are generally about 80 percent.
     The S&P 500 is recovering from its lowest level since June, and on Tuesday touched its average prices during the past 50 and 100 days, after arresting a nine-day slide at its 200-day moving average. The benchmark has wandered in a roughly 100-point band since reaching a record in August as investors assessed the political landscape, corporate profits, economic data and the likelihood for higher interest rates. The index closed today just 2.3 percent from its all-time high.
     “It’s hard to really make too much of today’s move,” said Yousef Abbasi, a global market strategist at JonesTrading Institutional Services LLC. “We’ve lost a little bit of steam as energy has headed into the red, but people are still in the wait-and-see mode. We met resistance right at the 50-day and 100-day moving average, so technicals might be in play.”
     Speculation on Clinton’s chances also helped bolster wagers on a Federal Reserve interest-rate increase next month. Data compiled by Bloomberg based on fed funds futures trading show an 86 percent probability of higher borrowing costs by year end, up from 76 percent on Friday.
     “Put your seat belts on because this is going to be a bumpy ride,” said Chad Morganlander, a Florham Park, New Jersey-based money manager at Stifel, Nicolaus & Co., which oversees about $172 billion. “As the polls close later today, investors will be moving in a chaotic fashion to get ahead of the information flow.”
     Amid the political drama, earnings season is winding down, with only a handful of S&P 500 members releasing Tuesday. Analysts now predict profit growth of 2.5 percent in the July- September period for the benchmark’s constituents, reversing forecasts for a 1.6 percent decline at the start of the month. Retailers Macy’s Inc., Kohl’s Corp. and Nordstrom Inc. are due to report later this week.
     Among shares moving Tuesday on earnings news:
* Priceline Group Inc. added 6.6 percent, rising to a record after its earnings, excluding a writedown, exceeded estimates.
* CVS Health Corp. marked the worst drop in seven years after cutting its full-year adjusted earnings range.
* Hertz Global Holdings Inc. shares plummeted 23 percent, the most since 2008, after reporting a quarterly profit that badly trailed estimates and cut its annual earnings forecast.
* Valeant Pharmaceuticals International Inc. tumbled 22 percent as new management cut the company’s profit forecast to well below predictions and suggested there may be more bad news on the way.
* Kindred Healthcare Inc. dropped to a 13-year low after also reducing its earnings outlook and saying it’s exiting the skilled nursing facility business.
     Elsewhere in today’s trading, 10 of the S&P 500’s 11 main industries rose, with utilities, phone and industrial companies increasing more than 0.5 percent. Energy producers were little changed as crude oil slipped. Freeport-McMoRan Inc. rallied 7.1 percent as copper futures touched a one-year high on speculation supply will tighten amid signs of stabilizing demand in China.
     Mondelez International Inc. and Campbell Soup Co. jumped at least 3.2 percent after a report said Brazil’s 3G Capital is seeking up to $10 billion for a new fund aimed at an acquisition in the consumer group. Kellogg Co. and General Mills Inc. added more than 2.6 percent.

 

Have a wonderful evening everyone.

 

Be magnificent!

We are always comparing what we are with what we should be.
This measuring ourselves all the time against something or someone
is one of the primary causes of conflict.  Now why is there any comparison at all?
If you do not compare yourself with another
you will be what you really are.
Krishnamurti

As ever,

 

Carolann

 

To love and win is the best thing.  To love and lose,
the next best.
                       -William Thackeray, 1811-1863

 

Carolann Steinhoff, B.Sc., CFP®, CIM, CIWM
Portfolio Manager &
Senior Vice-President

Queensbury Securities Inc.,
St. Andrew’s Square,
Suite 340A, 730 View St.,
Victoria, B.C. V8W 3Y7

 
Tel: 778.430.5808
(C): 250.881.0801
Toll Free: 1.877.430.5895
Fax: 778.430.5828
www.carolannsteinhoff.com

Dear Friends,

Tangents:
On Nov. 7, 1917, Russia’s Bolshevik Revolution took place as forces led by Vladimir Ilyich Lenin overthrew the provisional government of Alexander Kerensky.
Joni Mitchell’s birthday today, b. November 7^th, 1943.

BIG YELLOW TAXI
…Don’t it always seem to go
That you don’t know what you’ve got
‘Til it’s gone
They paved paradise
To put up a parking lot…
PHOTOS OF THE DAY

Russian paratroopers jump through a rainbow from an IL-76 transport plane during a joint Serbian-Russian military training exercise, ‘Slavic Brotherhood,’ in the town of Kovin, Serbia, on Monday. Marko Djurica/Reuters

A delegate from Cook Island attends the opening session of the Climate Conference in Marrakech, Morocco, on Monday. Climate negotiators have started work on implementing the Paris pact on global warming amid uncertainty over how the US election will impact the landmark deal as temperatures and greenhouse gases soar to new heights. Mosa’ab Elshamy/AP

A Hindu devotee holds offerings as she worships the Sun God in the waters of a pond during the religious festival of Chhat Puja in Kolkata, India, on Monday. Rupak De Chowdhuri/Reuters
Market Closes for November 7^th, 2016

Market Index	Close	Change
Dow Jones	18259.60	+371.32   +2.08%
S&P 500	2131.52	+46.34   +2.22%
NASDAQ	5166.172	+119.801   +2.37%
TSX	14652.45	+143.20
		+0.99%

International Markets

Market Index	Close	Change
NIKKEI	17177.21	+271.85
		+1.61%
HANG SENG	22801.40	+158.78
		+0.70%
SENSEX	27458.99	+184.84
		+0.68%
FTSE 100	6806.90	+113.64
		+1.70%

Bonds

Bonds		% Yield		Previous  % Yield
CND. 10 Year Bond		1.221		1.159
CND. 30 Year Bond		1.871		1.816
U.S.    10 Year Bond		1.8261		1.7762
U.S. 30 Year Bond		2.6021		2.5618

Currencies

BOC Close	Today	Previous
Canadian $	0.74797	0.74589
US $	1.33695	1.34068
Euro Rate 1 Euro=		Inverse
Canadian $	1.47633	0.67736
US $	1.10425	0.90559

Commodities

Gold	Close	Previous
London Gold Fix	1283.05	1302.80
Oil	Close	Previous
WTI Crude Future	44.89	44.07

Market Commentary:
Canada
By Eric Lam
     (Bloomberg) — Canadian stocks snapped a four-day slide as global markets rallied as investors speculate Hillary Clinton’s chances of winning the U.S. election have improved a day ahead of the vote.
     The S&P/TSX Composite Index added 1 percent to 14,652.45 at 4 p.m. in Toronto, for the biggest increase in three weeks. The index had lost 1.9 percent over the previous four sessions. The equity benchmark is up 13 percent in 2016, the top performer among developed markets tracked by Bloomberg. Canadian stocks are now 14 percent more expensive than their peers in the S&P 500 Index.
     Equities surged around the world after the FBI decided to stick to its previous view that Clinton’s handling of her e- mails wasn’t a crime. Clinton leads Donald Trump by three percentage points among likely voters, according to the final Bloomberg Politics national poll before Tuesday’s election. Clinton has 44 percent support to Trump’s 41 percent when third- party candidates are included.
     Toronto-Dominion Bank and Bank of Nova Scotia each climbed 1.1 percent to lead a rally in the nation’s largest lenders. Financial services and energy stocks gained at least 1.4 percent as 10 of 11 industries in the S&P/TSX advanced on trading volume 9.3 percent lower than the 30-day average. Raw-materials producers slumped 1.4 percent, the lone laggard, as gold sank the most in a month offsetting gains in copper and steel.
     Suncor Energy Inc. and Encana Corp. rose more than 2.5 percent as crude rebounded to halt a six-day losing streak that was the longest since July. Futures rose 1.9 percent in New York to join the broader market rally. A magnitude 5 earthquake struck near the oil hub at Cushing, prompting some pipeline operators to shut operations as a precaution.
     Concordia International Corp. plummeted 37 percent, extending the lowest levels in more than three years, after third-quarter earnings and revenue fell well short of estimates.
     The struggling drug maker also suspended its forecasts to assess its business under new leadership. Concordia shares have wiped out 95 percent of their value this year.
     Air Canada surged 7.5 percent, the biggest increase in almost six months, after the airline tightened its full-year profit target. Earnings before interest, taxes, depreciation amortization and aircraft rent will probably increase 6 percent to 8 percent this year, the company said. Air Canada had previously forecast 4 percent to 8 percent growth. Air Canada’s earnings also exceeded estimates.

US
By Joseph Ciolli
     (Bloomberg) — The resolution of the FBI’s investigation into Hillary Clinton’s e-mails two days before the presidential election could hardly have come at a worse time for investors betting on equity volatility into the election.
     Relief swept over stock markets Monday after the FBI reiterated Clinton’s controversial handling of her e-mails wasn’t a crime, sending the CBOE Volatility Index tumbling 17 percent. Bets the slump will continue rose to the highest in almost three months relative to wagers on an increase. The S&P 500 Index surged 2.2 percent to 2,131.52 at 4 p.m. in New York, the biggest one-day gain in eight months.
     The latest revelation quelled apprehension over the election’s outcome after Federal Bureau of Investigation Director James Comey said on Oct. 28 the agency was examining new e-mails potentially related to its review of Clinton’s use of a private server. Investors still smarting from being caught wrong-footed after the Brexit vote pushed the VIX up 39 percent last week, extending its longest-ever streak of gains to the highest level since June amid narrowing polls and an increasingly unpredictable election.
     “The end of the investigation lends a little more clarity to the situation,” Bill Schultz, who oversees $1.2 billion as chief investment officer of McQueen, Ball & Associates Inc. in Bethlehem, Pennsylvania, said by phone. “This gets us closer to reducing and possibly eliminating one of the main uncertainties surrounding the election, and you’re seeing that reflected in positioning.”
     Open interest on put contracts for the VIX swelled to 45 percent of the same measure for calls, the most since Aug. 18, according to data compiled by Bloomberg. That’s high relative to the average of 40 percent for the past year.
     The worry last week also pushed the spread between expected and realized volatility into the 99th percentile since 1990, according to Goldman Sachs Group Inc. With the measure that extended, there could be a “VIX collapse if uncertainty declines post-election,” David Kostin, chief U.S. equity strategist at the firm, wrote in a Nov. 4 client note.
     American stocks have shown themselves sensitive to Clinton’s presidential prospects, with futures rising in September during the first debate she was widely considered to have won. The S&P 500 tumbled about 20 points in the 40 minutes after Comey’s initial letter was made public. While the race has been tightening before tomorrow’s vote, Clinton still maintains a narrow lead over Republican rival Donald Trump, according to an average of polls by RealClearPolitics.
     The S&P 500 on Monday halted its longest losing streak since 1980. The Dow Jones Industrial Average soared 371.32 points, or 2.1 percent, to 18,259.60, a four-week high. The Nasdaq Composite Index increased 2.4 percent. Banks, technology companies and drugmakers paced the rebound, with lenders capping their steepest climb since August. JPMorgan Chase & Co. and Microsoft Corp. advanced more than 2.9 percent. About 7.1 billion shares traded hands on U.S. exchanges, 8 percent more than the three-month average.
     “We’ve been down nine straight days as concerns over a potential Trump victory put a lot of caution in the market,” said Michael James, managing director of equity trading at Wedbush Securities Inc. in Los Angeles. “Some of that is being relieved with the comments from the FBI about the Clinton e-mail investigations. All today guarantees is that there will be more volatility for the rest of the week following tomorrow’s election.”
     The S&P 500 has advanced in the five days before the vote in 20 of the past 22 presidential election cycles, according to data compiled by Bloomberg and Bespoke Investment Group LLC, with an average 1.9 percent climb in the run-up to votes going back to 1928. After today’s 2.2 percent rally, the index rose 0.3 percent over the five sessions before tomorrow’s election.
     Hedge fund manager David Tepper said he’s supporting Clinton for president after initially being open to backing Trump. He said in a CNBC interview on Monday that she will probably be to the right of her party’s platform on economic policy. The head of Appaloosa Management also said he’ll vote for Republican candidates running for the House and Senate.
     “There isn’t certainty she’ll win, but she is gaining some momentum and at least we got one worry out of the way,” said Christian Stocker, a strategist at UniCredit Bank AG in Munich, Germany. “This should last until Wednesday, when markets decide what the next direction is.”
     Speculation on Clinton’s chances also helped boost odds of a Federal Reserve interest-rate increase next month. Data compiled by Bloomberg based on fed funds futures trading show an 80 percent probability of higher borrowing costs by year end, up from 76 percent on Friday.
     The earnings season is drawing to a close, with about 85 percent of S&P 500 companies having reported. Of those, 56 percent beat sales expectations and 76 percent exceeded profit forecasts. Marriott International Inc. and News Corp. are among firms posting results today. Analysts forecast a profit increase of 2.5 percent for the benchmark’s members in the third quarter. If that holds, it will end the longest earnings recession since the financial crisis.
     Among shares moving on earnings news, Sysco Corp., the largest North American food distributor, surged the most in five years after posting first-quarter profit that beat analysts’ estimates.

Have a wonderful evening everyone.

 

Be magnificent!

As long as the brain, which is so heavily conditioned, is measuring, “the more,” “the better,”
moving psychologically from this to that, it must inevitably bring about a sense of conflict, and this is disorder.
Not only the words more and better, but the feeling, the reaction, of achieving,
gaining – as long as there is this division, duality, there must be conflict.  And out of conflict is disorder.
Krishnamurti

 

As ever,

 

Carolann

 

Absolutely.  If it’s at all possible.
                -Bob Dylan, b. 1941-
(responding to a journalist who asked if he would be attending the December 10^th Nobel Prize dinner in Stockholm)

Carolann Steinhoff, B.Sc., CFP®, CIM, CIWM
Portfolio Manager &
Senior Vice-President

Queensbury Securities Inc.,
St. Andrew’s Square,
Suite 340A, 730 View St.,
Victoria, B.C. V8W 3Y7

Tel: 778.430.5808
(C): 250.881.0801
Toll Free: 1.877.430.5895
Fax: 778.430.5828
www.carolannsteinhoff.com

Dear Friends,

Tangents:
In science one tries to tell people, in such a way as to be understood by everyone, something that no one ever knew before.
But in poetry, it’s the exact opposite.  -Paul Dirac

UNTITLED
 -Emily Dickinson

Morns are meeker than they were,
The nuts are getting brown,
The berry’s cheek is plumper,
The Rose is out of town.
The maple wears a gayer scarf,
The field a scarlet gown,
Lest I should be old fashioned
I’ll put a trinket on.

On this day in:
1922, King Tut’s tomb was found
1946, UNESCO  was founded
1979, the Iranian hostage crisis begins as militants stormed the U.S. Embassy in Tehran.
PHOTOS OF THE DAY

The Chicago River is dyed blue near the Michigan Avenue bridge in honor of the Chicago Cubs World Series win in Chicago on Friday. Cubs fans have packed the streets outside Wrigley Field hours before the start of the parade to honor the World Series champions. Erin Hooley/Chicago Tribune/AP

A woman joggs with her dog through a forest near Cologne, Germany on Friday. Henning Kaiser/AP
Market Closes for November 4th, 2016

MarketIndex	Close	Change
DowJones	17888.28	-42.39  -0.24%
S&P 500	2085.18	-3.48  -0.17%
NASDAQ	5046.371	-12.037  -0.24%
TSX	14509.25	-74.17
		-0.51%

International Markets

MarketIndex	Close	Change
NIKKEI	16905.36	-229.32
		-1.34%
HANGSENG	22642.62	-40.89
		-0.18%
SENSEX	27274.15	-156.13
		-0.57%
FTSE 100	6693.26	-97.25
		-1.43%

Bonds

Bonds		% Yield		Previous  % Yield
CND.10 Year Bond		1.159		1.200
CND.30 Year Bond		1.816		1.847
U.S.   10 Year Bond		1.7762		1.8115
U.S.30 Year Bond		2.5618		2.6020

Currencies

BOC Close	Today	Previous
Canadian $	0.74589	0.74664
US$	1.34068	1.33934
Euro Rate1 Euro=		Inverse
Canadian $	1.49339	0.66962
US$	1.11390	0.89774

Commodities

Gold	Close	Previous
London GoldFix	1302.80	1301.00
Oil	Close	Previous
WTI Crude Future	44.07	44.66

Market Commentary:
On [TV financial news programs], if the stock is near its high, 90% of the guests like it, if it is near is low, 90% of the guests hate it. –Michael L. Burke, 1935-2014.

Intelligence, May 2002.
Number of the Day
$12 billion
John Paulson’s drug-company investments has led to big losses and extended a period of uneven performance that has left the firm managing about $12 billion, down from $38 billion in 2011.
Canada
By John Hyland
     (Bloomberg) — Canadian stocks extended losses for a fourth day, closing at their lowest level since September as trade data overshadowed a third month of job gains.
     The S&P/TSX Composite Index fell 0.5 percent to 14,509.25 at 4 p.m. in Toronto, with its longest decline since August. Raw materials producers led the decline, falling 1 percent. Energy companies dropped for the sixth consecutive day, their longest losing streak since May, retreating after oil capped its biggest weekly decline since January.
     Stronger-than-forecast jobs data was countered by a trade deficit that widened to a record C$4.1 billion ($3.1 billion) in September as export volumes fell 0.8 percent from the previous month. However, the spike in the trade deficit was largely on the back of a one-time purchase related to an offshore oil project, described by Statistics Canada as “exceptionally large.” Excluding that impact, the trade gap narrowed, the agency said.
     Financial stocks declined for the third time in four days amid U.S. election angst. The group fell to its lowest level since mid-October, as Toronto-Dominion Bank and Bank of Nova Scotia slumped to two-week lows.
     Raw-materials producers fell as gold miners retreated, even as the precious metal held near a one-month high. Investors weighed the need for a haven before next week’s U.S. presidential election against expectations of higher interest rates. Detour Gold Corp. slumped to a seven-month low in an “overdone” selloff, according to Cormark Securities analyst Richard Gray. Kinross Gold Corp. lost 2.3 percent.
     Energy shares declined 0.5 percent to their lowest level since September, after oil capped its biggest weekly loss in almost 10 months. Crude slumped as hopes fade that OPEC will be able to implement a promised deal to cut production and ease global oversupplies. Suncor Energy Inc. fell 1 percent to a two- week low, and Canadian Natural Resources Ltd. fell to its lowest level since September.
     Canadian stocks are now 13 percent more expensive than their peers in the S&P 500 Index. The S&P/TSX trades at 22.1 times earnings, compared with 19.5 for the S&P 500 Index. The S&P/TSX is the top performer this year among developed equity markets tracked by Bloomberg.
US
By Dani Burger
     (Bloomberg) — The S&P 500 Index extended its longest losing streak in more than three decades, as data bolstered speculation interest rates will rise before year-end and investors remained wary before the looming presidential election.
     Equities faded in afternoon trading as declines among consumer, financial and energy shares overshadowed gains in drugmakers. Procter & Gamble Co. and Amazon.com Inc. were among the biggest drags, sinking more than 1.5 percent. Insurer Willis Towers Watson Plc tumbled 5.6 percent after cutting its full- year revenue forecast, and Wells Fargo & Co. lost 1.6 percent. Crude’s biggest weekly drop since January weighed on oil and gas producers.
     The S&P 500 fell 0.2 percent to 2,085.18 at 4 p.m. in New York, after erasing a 0.5 percent advance. The gauge has retreated 3.1 percent over nine days, the longest since 1980 when it dropped 9.4 percent. The Dow Jones Industrial Average lost 42.39 points, or 0.2 percent, to 17,888.28, and the Nasdaq Composite Index declined 0.2 percent. The CBOE Volatility Index rose for a ninth session, the longest ever. About 7.3 billion shares traded hands on U.S. exchanges, 12 percent more than the three-month average.
     “The jobs number should increase rate-hike odds and push up the dollar further, but nothing is happening in the markets ahead of the election,” said Dennis Debusschere, a senior managing director and global portfolio strategist at Evercore ISI in New York. “All expectations of the rate outlook and by extension the markets are being muted by election uncertainty.”
     A report today showed payrolls climbed by 161,000 last month following a 191,000 gain in September that was larger than previously estimated. Wages rose from a year earlier by the most since 2009, and the jobless rate fell to 4.9 percent. The figures are likely to keep the Federal Reserve on track to raise borrowing costs next month for the first time in 2016.
     While shares have almost always risen in the days before a presidential election, anxiety about the outcome of the Nov. 8 vote has weighed on stocks, overshadowing even a Fed meeting earlier this week. The S&P 500 fell Friday as low as 2,083, its average price during the past 200 days, and a technical level it hasn’t breached since the rout that followed the U.K.’s June vote to leave the European Union.
     The main U.S. equity benchmark posted a fourth weekly decline in the last five, down 1.9 percent as polls showed a dwindling lead for Democratic presidential candidate Hillary Clinton. Republican nominee Donald Trump showed strength in Iowa and Ohio pre-Election Day voting, while Clinton’s advantage in early balloting looked favorable in North Carolina and Nevada, according to a Bloomberg Politics analysis.
     The tightening race sent the CBOE Volatility Index surging 73 percent during the past two weeks, and dragged the S&P 500 to a four-month low. The measure of market turbulence known as the VIX reversed an earlier decline Friday as it rose 2 percent to 22.51, the highest since the Brexit aftermath.
     “The U.S. elections are the elephant in the room for markets at the moment,” said Christian Gatticker, Zurich-based head of research at Julius Baer Group Ltd. “The best case is gridlock where Hillary wins and works with a Republican Congress, while a worst case is a hung vote.”
     Hedge fund manager Dan Loeb said he’s cutting risk in his portfolio ahead of the vote on concern that surprises could rattle financial markets. “We’ve reduced our exposures, we’ve cut some positions and increased some hedges,” Loeb said Friday in a conference call discussing results at Third Point Reinsurance Ltd., the Bermuda-based insurer where he oversees investments. “And it isn’t just about the president. Obviously who wins is going to impact the market. I think equally important is what happens in the House and Senate.”
     Before today’s payrolls report and the approaching election, the Fed on Wednesday kept rates unchanged in a widely expected move, and indicated the argument for raising them has strengthened. Other data this week was mixed, with modest expansion in manufacturing last month, while services industries growth slowed. Traders are pricing in a 74 percent chance the central bank will act in December, up from 69 percent a week ago.
     “It’s worth noting that unemployment is the single best determining factor of market direction,” said Ross Yarrow, director of U.S. Equities at Robert W. Baird & Co. In London. “The S&P 500 almost never peaks for the cycle until unemployment troughs.”
     Traders are also parsing corporate results as the earnings season winds down. More than four out of five S&P 500 companies have reported so far, with 56 percent beating sales estimates and 75 percent topping profit forecasts. Analyst predict earnings for members of the index grew 2.5 percent in the July- September period, snapping a five-quarter stretch of declines.
     Among shares moving on earnings news, NRG Energy Inc. surged the most since December, after raising profit guidance for 2016. Mohawk Industries Inc. jumped 7.8 percent to its best one-day gain in five years after the flooring maker’s results topped estimates.
     Fluor Corp. sustained its steepest drop since 2008 after cutting its profit forecast because of a delayed construction project, and its earnings target for next year fell short of analysts’ expectations. Symantec Corp. slumped to a 2 1/2-month low after its current quarter sales and profit outlooks missed predictions and the chief financial officer stepped down.

 

Have a wonderful weekend everyone.

 

Be magnificent!

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

As ever,

 

Carolann

The only real failure in life is one not learned from.
-Anthony J. D’angelo, b. 1974

 

Carolann Steinhoff, B.Sc., CFP®, CIM, CIWM
Portfolio Manager &
Senior Vice-President

Queensbury Securities Inc.,
St. Andrew’s Square,
Suite 340A, 730 View St.,
Victoria, B.C. V8W 3Y7

Tel: 778.430.5808
(C): 250.881.0801
Toll Free: 1.877.430.5895
Fax: 778.430.5828
www.carolannsteinhoff.com

Dear Friends,

Tangents:
On Nov. 3, 1936, President Franklin D. Roosevelt was re-elected in a landslide over Republican Alfred M. ”Alf” Landon.
November 3, 1817 – The Bank of Montréal opens its first branch and trades its first shares.
November 3, 2016, the Chicago Cubs beat the Cleveland Indians 8-7 to win the World Series, ending the team’s 108-year drought.

NOVEMBER
The last red berries shrivel.  Night comes early, dawn late.  The sun is weaker.  Ice is on the birdbath, frost on the car.  Perhaps it is already snowing.  Certainly, it’s damp and raw.  Rain is forecast.  Now is the time to act, to begin.  As Ishmael says in Moby Dick, “whenever it is a damp, drizzly November in my soul….I account it high time to get to sea as soon as I can.”  He means it’s time for human deeds.  Without our contribution, nothing will happen, life will have no meaning without our experience, the world cannot evolve, life on earth cannot become more abundant.  “We have it in our power to begin the world over again,”  said Tom Paine.  “Start by doing what’s necessary; then do what’s possible; and suddenly you are doing the impossible,”  said St. Francis of Assisi.  All it takes is patience, grace, intention, and the right moment. –Cosmo Doogood’s Urban Almanac.
   Venus crosses the star-rich area of Sagittarius this month, reaching its greatest elongation; Mercury also reaches its greatest elongation.
November 6^th: Daylight Savings Time Ends
November 11^th: Remembrance Day
November 14^th: Full moon
November 29^th: New Moon
PHOTOS OF THE DAY

The Chicago Cubs celebrate after winning Game 7 of the Major League Baseball World Series against the Cleveland Indians on Thursday in Cleveland. The Cubs won 8-7 in 10 innings to win the series 4-3. Gene J. Puskar/AP

Fallen leaves cover a BMW on a rainy autumn day in Belgrade, Serbia, on Thursday. Marko Djurica/Reuters
Market Closes for November 2^nd, 2016

Market Index	Close	Change
Dow Jones	17930.67	-28.97   -0.16%
S&P 500	2088.66	-9.28   -0.44%
NASDAQ	5058.406	-47.159   -0.92%
TSX	14583.42	-11.30
		-0.08%

International Markets

Market Index	Close	Change
NIKKEI	17134.68	-307.72
		-1.76%
HANG SENG	22683.51	-126.99
		-0.56%
SENSEX	27430.28	-96.94
		-0.35%
FTSE 100	6790.51	-54.91
		-0.80%

Bonds

Bonds		% Yield		Previous  % Yield
CND. 10 Year Bond		1.200		1.185
CND. 30 Year Bond		1.847		1.828
U.S.    10 Year Bond		1.8115		1.7990
U.S. 30 Year Bond		2.6020		2.5641

Currencies

BOC Close	Today	Previous
Canadian $	0.74664	0.74670
US $	1.33934	1.33923
Euro Rate 1 Euro=		Inverse
Canadian $	1.48741	0.67231
US $	1.11056	0.90045

Commodities

Gold	Close	Previous
London Gold Fix	1301.00	1303.75
Oil	Close	Previous
WTI Crude Future	44.66	45.34

Market Commentary:
Number of the Day
38.08%
The percentage of earnings paid out as dividends by U.S. companies over the past 12 months, according to data provider FactSet. That’s just a fraction below the 38.19% reached during the height of the financial crisis, when the ratio’s rise was due to a steep fall in earnings.
Canada
By John Hyland
     (Bloomberg) — Canadian stocks erased gains to finish lower with global equities as investor anxiety rises ahead of Tuesday’s U.S. presidential election. Crude slumped to a five- week low, dragging down energy shares, while airlines slid amid speculation competition will increase.
     The S&P/TSX Composite Index fell 0.1 percent to 14,583.42 at 4 p.m. in Toronto, erasing a gain of as much as 0.5 percent. The S&P 500 Index slid for an eighth day and the CBOE Volatility Index had an equal number of gains as investors pulled back on riskier assets amid polls showing the U.S. election tightening.
     The election’s outcome on Canadian equities is not clear, though the U.S. is Canada’s largest trading partner and Republican Donald Trump has suggested he would amend or scrap the North American Free Trade Agreement if he prevails Tuesday. Democrat Hillary Clinton has indicated she would crack down on drug pricing, possibly hurting the fortunes of health-care companies.
     Eight of 11 groups in the benchmark index for Canadian equities retreated Thursday. Airlines led industrials lower as Air Canada dropped the most in three months after the federal transport minister signaled his intention to raise foreign ownership limits for carriers, a move that may create more competition for the country’s airlines. WestJet Airlines Ltd. also tumbled.
     Energy shares slipped as crude oil dropped to a five-week low. Enbridge Inc. fell 1.9 percent after reporting an unexpected loss in the third quarter, while Encana Corp. rose the most in three months after reporting a surprise profit.
     Valeant Pharmaceuticals International Inc. led the health- care sector lower, falling 8.8 percent. The shares fell more than 9 percent yesterday on a marketing lawsuit and reports that it’s exploring a sale of some eye-surgery assets worth $2.5 billion.
     Canadian stocks are now 15 percent more expensive than their peers in the S&P 500 Index. The S&P/TSX trades at 22.2 times earnings, compared with 19.6 for the S&P 500 Index. The S&P/TSX is the top performer among developed equity markets tracked by Bloomberg in 2016.
     Raw-materials producers advanced after snapping a four-day rally. Gains were once again centered around gold miners, with Kinross Gold surging 8.9 percent to its highest level since July 2016 after its CEO vowed to continue a disciplined approach to M&A. Barrick Gold Corp. added 1.2 percent.
     Financial stocks rose for the first time in three days as the election angst showed signs of abating. Fairfax Financial Holdings Ltd. climbed 2.9 percent, its best since August. Manulife Financial Corp. advanced 0.9 percent, while Royal Bank of Canada and Bank of Nova Scotia gained to propel the group higher.
US
By Rebecca Spalding and Joseph Ciolli
     (Bloomberg) — The 2016 election has confounded pundits, upended precedent and now it’s spurring unusual patterns in the U.S. equity market. To wit: stocks almost always rise in the days before the country picks a president. This year, they’re falling.
     The S&P 500 Index has advanced in the five days before the vote in 20 of the past 22 cycles, according to data compiled by Bloomberg and Bespoke Investment Group LLC. While the gauge has climbed an average 1.9 percent in the run-up to elections going back to 1928, it’s down 1.8 percent since Monday, with two market days left until polls open Nov. 8. The index fell 0.4 percent Thursday, to 2,088.66 at 4 p.m. in New York., slumping to the lowest since July 5 as losses accelerated in the late afternoon.
     Blame it on narrowing polls and the experience of traders during the last political drama they were asked to navigate, Britain’s vote to secede from the European Union, which proved costly to anyone going all-in on odds makers. A tightening race has sent the S&P 500 down eight straight days, the longest slump since 2008, and pushed the CBOE Volatility Index to its lengthiest streak of gains on record.
     “It all has to do with certainty and uncertainty, that’s what’s driving markets: the headlines and politics are the biggest headlines,” said Ernie Cecilia, chief investment officer at Bryn Mawr Trust, which oversees $9.6 billion in Bryn Mawr, Pennsylvania. “The recent decline has more to do with the top of the ticket polls getting tighter. The market hadn’t factored in the possibility of a Donald Trump presidency.”
     Just four months removed from the U.K.’s shock decision to leave the European Union in an outcome not predicted by betting markets, anxiety levels have spiked in the final week of an election season marked by twists that have seen Democrat Hillary Clinton’s once dominant lead over Republican Donald Trump wither in recent polls. The Brexit shock sent the S&P 500 tumbling 5.3 percent in two days, while the VIX spiked the most in five years.                     
     The hard-to-predict election is adding anxiety to a market that already has plenty to fret about. Valuations remain their highest since 2009 as central banks around the world have kept monetary policies loose. U.S. companies today trade at 77 percent higher valuations on a price-earnings basis than they did when the 7 1/2-year bull market began.
     Even as valuations have grown, earnings haven’t kept pace. Corporate profits have contracted for five quarters in a row, the longest run since the financial crisis. The stretched equity prices and sluggish earnings have made some traders skittish. Investors have pulled $100 billion from mutual and exchange traded funds that track U.S. stocks since January, an almost unprecedented rate.
     While forecasts predict the earnings recession is set to end this quarter as most S&P 500 companies that have reported thus far have beaten estimates, the good news for corporate profits hasn’t been enough to shake investors’ election anxiety. Trading in options that protect against a market decline reached its highest level since April last week, ahead of Wednesday’s FOMC meeting where officials signaled the Federal Reserve will likely raise interest rates in December.                    
     “Markets are always adjusting and they’re handicapping in the short run what the outcome will be,” said Kevin Caron, a Florham Park, New Jersey-based market strategist and portfolio manager who helps oversee $180 billion at Stifel Nicolaus & Co. “Everyone wants to talk about the election but the market is moved by more of the latter points: the outlook for earnings and the outlook for interest rates.”
     Corporate results did little to buoy the market Thursday, with Facebook Inc. suffering the steepest slide since February after executives indicated the company will see slower revenue growth and higher costs. American International Group Inc. dropped the most in four months after posting a profit that was short estimates. Marathon Oil Corp. jumped 11 percent after reporting a smaller-than-predicted loss, while production exceeded forecasts.
     The Nasdaq Biotechnology Index slumped 2.9 percent to a four-month low after people familiar with the matter said U.S. prosecutors are bearing down on generic pharmaceutical companies in a sweeping criminal investigation into suspected price collusion. Endo Pharmaceuticals Plc plunged more than 19 percent, the most in six months.
     Almost 80 percent of S&P 500 companies have reported earnings this season, with 56 percent beating sales expectations and 76 percent topping profit forecasts. Analysts forecast profit for the benchmark’s members will rise 1.6 percent for the period, on pace to end the longest earnings recession since the financial crisis.                      
     The S&P 500 ended below the technically sensitive 2,100 level yesterday for the first time since July 7. The Dow Jones Industrial Average today slipped 28.97 points, or 0.2 percent, to 17,930.67. The Nasdaq Composite Index lost 0.9 percent as Facebook paced a selloff in technology companies, and health- care dropped to an eight-month low. About 7.3 billion shares traded hands on U.S. exchanges, 12 percent more than the three- month average.
     Investors yesterday were unmoved by the Federal Reserve’s widely expected decision to stand pat on interest rates. Policy makers reinforced expectations for a hike in December after saying the argument for higher borrowing costs strengthened further amid accelerating inflation. Traders are pricing in a 78 percent chance the central bank will act next month.
     Ahead of the government’s monthly payrolls report, a reading today showed filings for unemployment benefits unexpectedly rose to the highest level in almost three months. Another measure indicated service industries expanded less than projected in October, consistent with moderate growth in the biggest part of the economy. Data also showed factory orders in September rose more than forecast.

 

Have a wonderful evening everyone.

 

Be magnificent! 

Satisfy one’s desires, certainly, but which ones?
And to what extent?
To determine precisely what I want, and how.
Children?  Money?  Glory?  How?
Swami Prajnanpad

As ever,

 

Carolann

 

People don’t notice whether it’s winter or summer when they’re happy.
                                                           -Anton Chekhov, 1860-1904

 

Carolann Steinhoff, B.Sc., CFP®, CIM, CIWM
Portfolio Manager &
Senior Vice-President

Queensbury Securities Inc.,
St. Andrew’s Square,
Suite 340A, 730 View St.,
Victoria, B.C. V8W 3Y7

Tel: 778.430.5808
(C): 250.881.0801
Toll Free: 1.877.430.5895
Fax: 778.430.5828
www.carolannsteinhoff.com

Dear Friends,

Tangents: ALL SOULS’ DAY
               DAY OF THE DEAD (MEXICO)

The day devoted to prayer and almsgiving on behalf of the departed.  According to tradition, a certain pilgrim returning from the Holy Land took refuge on a rocky island during a storm.  There he met a hermit, who told him that among the cliffs was an opening to the infernal regions, through which flames ascended, and where the groans of the tormented were distinctly audible.  The pilgrim told Odilo, abbot of Cluny, who appointed the day following – November 2, 998 – to be set apart for the benefit of those souls in Purgatory.  In England, it was formerly observed by ringing the “soul bell” or “passing bell”, by making and distributing soul cakes or by blessing beans and so on.
 A passing bell used to be rung when a person was on the point of death, to scare away any evil spirits that might be lurking ready to snatch the soul while passing from the body.  A secondary objective was to announce to the neighborhood so that all might pray for the safe passage of the soul into Paradise.      Athenians used to beat on brazen kettles at the moment of death to scare away the Furies.

On this day in 1947, Howard Hughes pilots the Spruce Goose on its only flight.
On Nov. 2, 1976, former Georgia Gov. Jimmy Carter defeated Republican incumbent Gerald R. Ford, becoming the first U.S. president from the Deep South since the Civil War.

PHOTOS OF THE DAY

University of Edinburgh students wear outfits adorned with lights, mirrors, and bells to mark the Indian Festival of Diwali in Edinburgh, Scotland, on Wednesday. The five-day festival of lights is celebrated worldwide by Hindus. David Cheskin/PA/AP

People pray beside the graves of their relatives at a cemetery during the observance of All Souls Day in Mumbai, India, on Wednesday.Danish Siddiqui/Reuters

The sun rises behind the Manhattan skyline on Wednesday. Lucas Jackson/Reuters
Market Closes for November 2^nd, 2016

Market Index	Close	Change
Dow Jones	17959.64	-77.46   -0.43%
S&P 500	2097.94	-13.78   -0.65%
NASDAQ	5105.566	-48.011   -0.93%
TSX	14595.11	-183.21
		-1.24%

International Markets

Market Index	Close	Change
NIKKEI	17134.68	-307.72
		-1.76%
HANG SENG	22810.50	-336.57
		-1.45%
SENSEX	27527.22	-349.39
		-1.25%
FTSE 100	6845.42	-71.72
		-1.04%

Bonds

Bonds		% Yield		Previous  % Yield
CND. 10 Year Bond		1.185		1.208
CND. 30 Year Bond		1.828		1.851
U.S.    10 Year Bond		1.7990		1.8274
U.S. 30 Year Bond		2.5641		2.5806

Currencies

BOC Close	Today	Previous
Canadian $	0.74670	0.74664
US $	1.33923	1.33933
Euro Rate 1 Euro=		Inverse
Canadian $	1.48609	0.67291
US $	1.10966	0.90118

Commodities

Gold	Close	Previous
London Gold Fix	1303.75	1288.45
Oil	Close	Previous
WTI Crude Future	45.34	46.67

Market Commentary:
NUMBERS OF THE DAY
$10 billion 

The amount for which Valeant Pharmaceuticals International is in advanced talks to sell Salix Pharmaceuticals, a big stomach-drug business, to Japan’s Takeda Pharmaceutical, a move seen easing pressure on Valeant caused by its hefty debt load

51.4%
The percentage of all mortgage loan dollars in the third quarter extended by nonbank financial firms, according to Inside Mortgage Finance. It marks the first quarter that banks, credit unions and other depository institutions have fallen below the 50% threshold in more than 30 years.

Interesting – I attended an all day conference in NYC on the topic of  FinTech put on by Buttonwood (The Economist) a couple of weeks ago and one of the astonishing revelations is that fintech now commands 30% of what used to be conventional banking.
Canada
By John Hyland
     (Bloomberg) — Canadian stocks tumbled for a second day as investors retreated from equities amid concerns about the upcoming U.S. presidential election and the increased probability of an interest rate hike before the end of the year.
     The S&P/TSX Composite Index fell 1.2 percent to 14,594.72 at 4 p.m. in Toronto. All 11 industry groups in the index retreated. Health care shares lost 6.2 percent as Valeant Pharmaceuticals International Inc. was sued over its failed marketing of a female libido pill. Energy stocks also weighed down the gauge as oil dropped to a one-month low after data showed U.S. stockpiles grew. And raw-materials producers snapped a four-day rally as miners dropped 2.3 percent
     Oil fell to the lowest level in more than a month after industry data showed U.S. crude stockpiles grew and supplies from OPEC members increased. Among energy shares, TransCanada Corp. tumbled nearly 5 percent to the lowest level since June 2016, after the company announced it’s raising about $6.1 billion to help fund its acquisition of Columbia Pipeline Group Inc.
     Gold prices advanced for a fifth day on increased concern over the outcome of the election. Miners ended a four-day rally, falling after the Federal Reserve meetings ended and the probability of a December interest rate hike increased. Barrick Gold Corp. snapped its longest winning streak since July 2016, falling 1.7 percent. Detour Gold Corp. fell 18.8 percent to its lowest level since April 2016 after missing production and revenue estimates.
     Lenders slipped as investors crowded into haven assets after a poll on Nov. 1 showed Donald Trump gaining ground against Hillary Clinton. Royal Bank of Canada fell 0.8 percent, sending the country’s largest bank to its lowest level in more than two weeks. Toronto-Dominion Bank fell 0.6 percent.
     Valeant led the health care sector lower, falling 9.1 percent on the marketing lawsuit and reports that its exploring a sale of some eye-surgery assets worth $2.5 billion. Yesterday, the shares surged 30 percent after a report said it’s looking to sell the Salix gastrointestinal drug business it acquired last year for $11.1 billion.
     Canadian stocks are now 15 percent more expensive than their peers in the S&P 500 Index. The S&P/TSX trades at 22.6 times earnings, compared with 19.7 for the S&P 500 Index. The S&P/TSX is the top performer among developed equity markets tracked by Bloomberg in 2016.
US
By Rebecca Spalding, Joseph Ciolli and Anna-Louise Jackson
     (Bloomberg) — U.S. stocks fell, with the S&P 500 Index mired in its longest slump in five years, after investors shrugged at the Federal Reserve’s decision to stand pat on interest rates and remained on edge before the U.S. presidential election.
     The Fed’s as-expected message did little to temper increasing anxiety over the implications from the Nov. 8 vote, which has begun to dominate market sentiment. Equities are also grappling with mixed earnings reports and a plunge in crude prices that sent oil to a one-month low. Facebook Inc. edged higher in after-hours trading following the social network’s quarterly results.
     The S&P 500 Index dropped 0.7 percent to 2,097.94 at 4 p.m. in New York, capping a seventh straight loss to remain near a four-month low. The benchmark closed below 2,100, after briefly dipping beneath the technically sensitive level Tuesday for the first time since July 7. The Dow Jones Industrial Average lost 77.46 points, or 0.4 percent, to 17,959.64, and the Nasdaq Composite Index slid 0.9 percent.
     “The FOMC minutes were benign and came in as expected, with the only real change coming as we went from three dissenters to two,” Yousef Abbasi, a global market strategist at JonesTrading Institutional Services LLC, said by phone. “More than anything right now we’re seeing a combination of uncertainty and a lack of motivation to do anything before the election. People are de- risking their books, and in some cases opting to sit on the sideline.”
     Wednesday’s retreat came after the S&P 500 fell yesterday by the most in three weeks, amid polls showing Hillary Clinton’s once formidable lead over Donald Trump in the presidential race has withered. That jolted stocks from the tightest trading range since 2006 as investors brace for market turmoil. Just four months removed from the U.K.’s shock decision to leave the European Union in an outcome not predicted by betting markets, anxiety levels have spiked as the election polls have narrowed.
     The CBOE Volatility Index remained at its highest since June after spiking more than 48 percent in seven days. The measure of market turbulence known as the VIX extended its streak of gains to the longest since 2013. About 8.1 billion shares traded hands on U.S. exchanges, 25 percent more than the three-month average.
     Banks and energy producers were among the biggest drags today as bond yields retreated amid demand for havens, and crude prices sank to the lowest in more than a month. Gilead Sciences Inc. and Allergan Plc fell more than 2.1 percent after both drugmakers’ profits missed estimates. Technology shares were weighed by Google parent Alphabet Inc.’s slide to a three-month low, and as Facebook sank 1.8 percent before its earnings report.
     After markets closed, Facebook was little changed as of 4:35 p.m. The company said revenue jumped to a record, boosted by video advertising and sales from Instagram. The results exceeded analysts’ estimates.
     Meanwhile, policy makers said today the case to boost borrowing costs has continued to strengthen, but decided, “for the time being,” to wait for more evidence of progress toward their employment and inflation objectives. The decision to forgo a rate increase had been widely expected owing to the proximity of next week’s election.
     The central bank has held the target range for the benchmark fed funds rate at 0.25 to 0.5 percent all year after raising it in December for the first time in nearly a decade. Concerns over slowing global growth and a slide in U.S. inflation expectations have kept them sidelined. Officials last December forecast it would be appropriate to raise rates four times in 2016, their median estimate showed. That projection was cut in March to two moves this year and lowered again in September to just one.
     Data today showed companies added fewer workers than forecast in October, signaling slower progress than estimated in the labor market. The government’s monthly payrolls report is due Friday. Following the FOMC decision, traders now price in 80 percent odds on a December increase, compared to 67 percent before the statement was released.
     “They’ve done everything they need to do to tee December up,” said Chris Zaccarelli, chief investment officer of Cornerstone Financial Partners, which oversees more than $1 billion in assets in Huntersville, North Carolina. “They’ve all but indicated they’re going to raise rates in December, but they’re leaving a little room in case something unexpected happens with the election or something that sends the market into a tailspin.”
     The S&P 500 has advanced the five days before a presidential election in 20 of the past 22 votes, according to data compiled by Bloomberg. The gauge has climbed an average 1.9 percent in the run-up to all elections going back to 1928. It’s down 1.3 percent since Monday, with three trading days left until polls open Nov. 8.
     Canaccord Genuity Inc.’s Tony Dwyer upgraded his view of equities to positive from neutral Wednesday. In a note, the co- head of U.S. equity research said the selloff provided a window for active investors to become more aggressive. “While the markets hate uncertainty, in a positive fundamental backdrop, investors should love it because it creates opportunity,” Dwyer said by telephone, highlighting health-care, financials, industrials and technology as groups to consider. “The seasonal history suggests you want to buy any weakness.”

Have a wonderful evening everyone.

 

Be magnificent!

Such awareness is like living with a snake in the room;
you watch its every movement, you are very, very sensitive to the slightest sound it makes.
Such a  state of attention is total energy;
in such awareness the totality of yourself is revealed in an instant.
Krishnamurti

As ever,

 

Carolann

 

There are only two days in the year that nothing can be done.  One is called yesterday
and the other is called tomorrow, so today is the right day to love, believe , do
and mostly live.
                                                                                             -The Dalai Lama

Carolann Steinhoff, B.Sc., CFP®, CIM, CIWM
Portfolio Manager &
Senior Vice-President

Queensbury Securities Inc.,
St. Andrew’s Square,
Suite 340A, 730 View St.,
Victoria, B.C. V8W 3Y7

 
Tel: 778.430.5808
(C): 250.881.0801
Toll Free: 1.877.430.5895
Fax: 778.430.5828
www.carolannsteinhoff.com

 

Dear Friends,

Tangents: ALL SAINTS’ DAY
Pope Boniface  IV converted the Pantheon at Rome into  a Christian church, dedicated to all the martyrs, in 610. The original Pantheon built by Agrippa in 27 BC was dedicated to all gods.  This was largely destroyed by fire and its successor, built by Hadrian  c. 120 AD, was also dedicated to all the gods.  It is circular and over 140 ft in diameter (42.6 m) and of similar height.  Since the early 7^th century it has been called Santa Maria Rotunda.  Among the national heroes buried there are the painter Raphael (1483-1520), the first king of Italy, Victor Emmanuel II (1820-78), and Umberto I (1844-1900). The festival of All Saints, originally held on May 1^st was changed to November 1^st in 834.
Hadrian also built a Pantheon at Athens.  The Panthéon at Paris was originally the church of St. Genevieve started by Louis XV in 1764 and completed in 1812.  Jean-Jacques Rousseau (1712-78), Voltaire (1694-1778) and Victor Hugo (1802-85)  are buried there. 
Westminster Abbey has been called the British Pantheon.

You can’t look at the competition and say you’re going to do it better.  You have to look at the completion and say you’re going to do it differently. –Steve Jobs.
PHOTOS OF THE DAY

Two dogs enjoy a park in Frankfurt, Germany, on a foggy Tuesday morning. Michael Probst/AP

A man walks past graves at Powazki cemetery in Warsaw, Poland, on Tuesday. Candles illuminated tombstones in graveyards across Poland on All Saints’ Day, observing one of the most sacred days in the calendar for this deeply Catholic nation. Alik Keplicz/AP
Market Closes for November 1^st, 2016

Market Index	Close	Change
Dow Jones	18037.10	-105.32   -0.58%
S&P 500	2111.72	-14.43   -0.68%
NASDAQ	5153.578	-35.557   -0.69%
TSX	14778.32	-8.95
		-0.06%

International Markets

Market Index	Close	Change
NIKKEI	17442.40	+17.38
		+0.10%
HANG SENG	23147.07	+212.53
		+0.93%
SENSEX	27876.61	-53.60
		-0.19%
FTSE 100	6917.14	-37.08
		-0.53%

Bonds

Bonds		% Yield		Previous  % Yield
CND. 10 Year Bond		1.208		1.196
CND. 30 Year Bond		1.851		1.849
U.S.    10 Year Bond		1.8274		1.8255
U.S. 30 Year Bond		2.5806		2.5798

Currencies

BOC Close	Today	Previous
Canadian $	0.74664	0.74535
US $	1.33933	1.34165
Euro Rate 1 Euro=		Inverse
Canadian $	1.48076	0.67533
US $	1.10560	0.90448

Commodities

Gold	Close	Previous
London Gold Fix	1288.45	1272.00
Oil	Close	Previous
WTI Crude Future	46.67	46.86

Market Commentary:
Number of the Day
40%
The increase in the price of the pipe-making material PVC on the Dalian Commodity Exchange so far this year, one of a number of apparent asset bubbles that have formed in China as speculative money sloshes from stocks to bonds to commodities.
Canada
By John Hyland
     (Bloomberg) — Canadian stocks staged an afternoon comeback to almost erase losses before closing at a two-week low, as Valeant Pharmaceuticals International Inc. surged the most in 23 years to offset declines in industrial and bank shares.
     The S&P/TSX Composite Index fell less than 0.1 percent to 14,778.32 at 4 p.m. in Toronto, the lowest since Oct. 18. The gauge fell as much as 0.5 percent before the Wall Street Journal’s report on Valeant sent the stock surging 30 percent. The S&P/TSX rose 0.4 percent in October for a fourth monthly gain and is up 14 percent in 2016.
     Financial shares slipped as Royal Bank of Canada fell 0.7 percent, sending the largest lender to its lowest level in more than two weeks. Thomson Reuters Corp. jumped 4 percent after it posted third-quarter profit that beat estimates. The company will cut 2,000 jobs worldwide and take a fourth-quarter charge of $200 million to $250 million to reduce expenses.
     Valeant rallied after a report said the company is in talks to sell its Salix gastrointestinal drugs business for as much as $10 billion to Takeda Pharmaceutical Co Ltd. The stock rebounded after falling on Monday to the lowest since 2010, when people familiar with the matter said its former CEO and CFO are the focus of U.S. prosecutors as the as they build a fraud case against the company.
     Among energy shares, Enbridge Inc. sank 0.8 percent, and Cameco Corp. fell 3.7 percent to weigh on the group. Crude in New York declined to a one-month low. Prices earlier swung between gains and losses as a projected U.S. stockpile gain added to supply concerns, while gasoline jumped after an explosion and fire in Alabama shut the largest fuel pipeline in the U.S.
     Gold prices advanced before as the Federal Reserve began a two-day meeting and as investors grew more anxious ahead of a tight U.S. presidential race. Gold miners in the S&P/TSX rallied 2.9 percent, as Barrick Gold Corp. gained 4.5 percent and Goldcorp Inc. increased 2.1 percent to a one-week high.
     WestJet Airlines Ltd. jumped the most since July after Canada’s second-largest airline reported third-quarter profit that beat analysts’ estimates and said capacity growth next year would slow.
     Canadian stocks are now 17 percent more expensive than their peers in the S&P 500 Index. The S&P/TSX trades at 22.9 times earnings, compared with 19.9 for the S&P 500 Index. The S&P/TSX is the top performer among developed equity markets tracked by Bloomberg in 2016.

US
By Joseph Ciolli and Anna-Louise Jackson
     (Bloomberg) — U.S. stocks fell to the lowest since July, breaking below chart levels that have held for four months, as concern over everything from presidential politics to Federal Reserve rate hikes and coming data on the labor market sent gauges of anxiety surging.
     The S&P 500 Index declined 0.7 percent to 2,111.72 at 4 p.m. in New York, the most since Oct. 11. The index has tumbled 1.8 percent during a six-day losing streak that’s its longest since August 2015. It sank as low as 2,097.85 before a bounce, dipping below 2,100 for the first time since July 7. The Dow Jones Industrial Average slipped 105.32 points, or 0.6 percent, to 18,037.10. The Nasdaq Composite Index dropped 0.7 percent, and the CBOE Volatility Index surged 8.8 percent to the highest since June 28.
     “This unbelievable election season we’re going through isn’t exactly engendering confidence,” Richard Sichel, chief investment officer at Philadelphia Trust Co., which oversees $2 billion, said by phone. “There’s more uncertainty as nervousness reaches a crescendo in the final days. Earnings season is basically over, and while it was a pretty good one, there’s nothing out there to trigger an up-move.”
     U.S. equities joined a selloff in riskier assets following an ABC News/Washington Post tracking poll that showed Republican Donald Trump with 46 percent support to Democrat Hillary Clinton’s 45 percent. Gold surged more than 1 percent, the dollar weakened versus the Swiss franc, and Mexico’s peso, considered an inverse proxy for Trump’s election fortunes, tumbled.
     Pacing the equity declines, Pfizer Inc. sank the most in three months as its quarterly profit fell short of estimates, while Apple Inc. slipped to a seven-week low to weigh on technology shares, amid signs of softness in demand in China for the iPhone 7. Occidental Petroleum Corp. dropped the most since March following its results. About 8.1 billion shares traded hands on U.S. exchanges, 25 percent more than the three-month average.
     Tuesday’s equity rout jolted stocks from the tightest trading range since 2006 as investors brace for market turmoil a week from one of the most contentious presidential elections in memory. Just four months removed from the U.K.’s shock decision to leave the European Union in an outcome not predicted by betting markets, anxiety levels have spiked as Clinton’s once dominant lead over Trump withers in the latest polls.
     “So many people have said that if Trump wins there’s going to be some big downside event and with the polls tightening and revelations around Clinton, it just has traders looking to trade on the basis of that,” said Jim Paulsen, chief investment strategist at Wells Capital Management. “Then it caught some momentum, because we took out some of the lows technically where we’ve been at since it rallied to new highs.”
     Hedges against a market decline surged in recent days. The CBOE Volatility Index yesterday capped its biggest monthly jump since August 2015, with the measure of market turbulence known as the VIX rising 28 percent during the period. The S&P 500 fell 1.9 percent in October, the most since a selloff at the start of the year, trimming its annual advance to 4 percent. The last time it fell below 2,100, it started a five-week rally of 4.4 percent that took it to its most recent all-time high.
     Ten of 11 main industries in the S&P 500 fell Tuesday, with real estate and utility stocks leading losses with declines of at least 1.7 percent. Technology shares, the biggest group by weighting, slid 0.8 percent as Apple and Facebook Inc. dropped more than 1.1 percent.
     The Fed’s next monetary policy decision is due Wednesday afternoon. Traders are pricing in a 16 percent chance the central bank will raise rates tomorrow, less than a week before the Nov. 8 election, while the odds on a December move are about 70 percent.
     A report Tuesday showed America’s factories barely expanded last month as faster production cushioned a slowdown in orders that signals a plodding manufacturing sector. Earnings are also in focus, with 40 members of the S&P 500 reporting Tuesday. Two- thirds of the way through the season, analysts now expect third- quarter profit growth of 1.6 percent for the benchmark’s constituents, after calling for declines as recently as Oct. 21. 
     If the forecast holds, it would bring an end to the longest earnings recession since the financial crisis.

Have a wonderful evening everyone.

 

Be magnificent!

If you wish to free yourself from suffering, you must free yourself from pleasure,
and not free yourself from suffering.  Suffering is a reaction.
If you wish to release yourself from suffering,
you must first of all release yourself from pleasure.
Then the suffering will disappear.
Swami Prajnanpad

As ever,

 

Carolann

 

Land of Heart’s Desire, Where beauty has no ebb, decay no flood,
But joy is wisdom, time an endless song.
                                                           -W.B Yeats, 1865-1939
                                                           The Land of Heart’s Desire

 

Carolann Steinhoff, B.Sc., CFP®, CIM, CIWM
Portfolio Manager &
Senior Vice-President

Queensbury Securities Inc.,
St. Andrew’s Square,
Suite 340A, 730 View St.,
Victoria, B.C. V8W 3Y7

 
Tel: 778.430.5808
(C): 250.881.0801
Toll Free: 1.877.430.5895
Fax: 778.430.5828
www.carolannsteinhoff.com

Dear Friends,

Tangents:

Wiccan New Year
Halloween
Which in the old Celtic calendar was the last day of the year, its night being the time when all the witches and warlocks were abroad,  On the introduction of Christianity it was taken over as the eve (even or e’en) of “all hallows” or “All Saint’s”, and in the late 20^th century it was still a popular “party” occasion.  Adults don ghoulish garb and light candles in hollowed-out-pumpkins to look like eerie grinning heads, and children, similarly attired, go round the houses to play “trick or treat”.  –from Brewster’s Dictionary of Phrase & Fable.

We went to the opera in Seattle on Saturday night and fittingly, it was a performance of Hansel and Gretel.  The witch in the Grimm’s brother’s fairy tale was one of the best ever.  Interestingly, the opera was choreographed with a modern twist – the witch’s house in the forest was intricately made of modern day candy, there were no leaves on the trees;  Hansel and Gretel’s house was made of cardboard.  So many people  in the audience  sported fantastic costumes; it sure was a fun intermission taking them all in – so many creative spirits.

On Oct. 31, 1984, Indian Prime Minister Indira Gandhi was assassinated near her residence by two Sikh security guards.

Also on this day, in 1517, Martin Luther nails his 95 theses to the door of the Castle Church in Wittenberg, Germany, beginning the Protestant Reformation.
PHOTOS OF THE DAY

Migrating cranes fly during sunset near Straussfurt, central Germany, on Monday. The cranes rest in central Germany on their way from breeding places in the north to their wintering grounds in the south. Jens Meyer/AP

People paddle a small boat as they enjoy a mild autumn day on Daumesnil Lake at the Bois de Vincennes east of Paris on Monday. Christian Hartmann/Reuters
Market Closes for October 31^st, 2016

Market Index	Close	Change
Dow Jones	18142.42	-18.77   -0.10%
S&P 500	2126.15	-0.26   -0.01%
NASDAQ	5189.135	-0.969   -0.02%
TSX	14787.27	+1.98
		+0.01%

International Markets

Market Index	Close	Change
NIKKEI	17425.02	-21.39
		-0.12%
HANG SENG	22934.54	-20.27
		-0.09%
SENSEX	27930.21	-11.30
		-0.04%
FTSE 100	6954.22	-42.04
		-0.60%

Bonds

Bonds		% Yield		Previous  % Yield
CND. 10 Year Bond		1.196		1.229
CND. 30 Year Bond		1.849		1.891
U.S.    10 Year Bond		1.8255		1.8468
U.S. 30 Year Bond		2.5798		2.6154

Currencies

BOC Close	Today	Previous
Canadian $	0.74535	0.74646
US $	1.34165	1.33966
Euro Rate 1 Euro=		Inverse
Canadian $	1.47259	0.67908
US $	1.09759	0.91108

Commodities

Gold	Close	Previous
London Gold Fix	1272.00	1273.00
Oil	Close	Previous
WTI Crude Future	46.86	48.70

Market Commentary:
Number of the Day
$3 billion
Amount raised by companies going public on U.S. exchanges last week, the best stretch for the U.S. IPO market in more than a year.
Canada
By John Hyland
     (Bloomberg) — Canadian stocks all but erased gains to finish little changed as a selloff in Valeant Pharmaceuticals International Inc. offset gains in banks and raw-materials.
     The S&P/TSX Composite Index rose less than 0.1 percent to 14,787.40 at 4 p.m. in Toronto as eight of the 11 sectors in the benchmark edged higher. The gauge capped a fourth straight monthly advance, rising 0.4 percent.
     Valeant dropped to the lowest level since 2010 after people familiar with the matter said its former CEO and CFO are the focus of U.S. prosecutors as the as they build a fraud case against the company that could yield charges within weeks. Valeant fell 12 percent, bringing the health care group down 7.9 percent.
     Raw-materials gained 1.7 percent as gold miners advanced, even as the precious metal fell for the first time in three sessions. Investors weighed the possibility of an impending Federal Reserve interest-rate increase and new uncertainties related to the U.S. presidential campaign. U.S. polls showed that Hillary Clinton lost some ground to Donald Trump after the Federal Bureau of Investigation said it’s reviewing newly discovered e-mails that may be pertinent to its inquiry of her use of a private server.
     Financial stocks climbed as the nation’s largest lenders rebounded from broad declines. The group gained 0.2 percent, led by a 0.6 percent advance in Toronto-Dominion Bank, after a report the bank is well-positioned to win an auction for Richardson GMP, a Canadian wealth management firm. The lender reached a record high.
     Energy shares declined as crude in New York fell to a one- month low after weekend talks between OPEC producers failed to produce tangible details on a deal to curb production. Encana Corp. lost 4.6 percent and Canadian Natural Resources Ltd. dropped 1.8 percent.
     Suncor Energy Inc. slipped 1.4 percent, after surging to a two-year high on Thursday as it swung to a third-quarter profit. The company agreed to sell its Canadian lubricants business to HollyFrontier Corp. for C$1.125 billion ($840 million), as Canada’s largest energy producer focuses on core operations in a period of rising oil prices.
     Industrial stocks retreated. Bombardier Inc. fell 4.3 percent. The company announced a jet sale valued at $129.4 million after signing a purchase pact with China’s Minsheng Financial Leasing, which will lease the four Challenger 650 business jets to Singapore based Zetta Jet. Competitor Embraer SA said it won’t use discounts to gain share in the private-jet market as the Brazilian company seeks to reposition itself as a premium-priced planemaker.
     Canadian stocks are now 17 percent more expensive than their peers in the S&P 500 Index. The S&P/TSX trades at 22.9 times earnings, compared with 19.9 for the S&P 500 Index. The S&P/TSX is up almost 14 percent in 2016, the top performance among developed equity markets tracked by Bloomberg.

US
By Joseph Ciolli
     (Bloomberg) — As the presidential election race narrows after Friday’s surprise FBI announcement, stock investors are finally showing some jitters.
     Hedges against a market decline surged immediately following reports that the Federal Bureau of Investigation is reviewing files that may be related to an investigation of Hillary Clinton’s e-mail practices when she was secretary of state. The ratio of bearish versus bullish options changing hands on the Chicago Board Options Exchange jumped the most since June to match a four-month high.
     After falling 20 points in 40 minutes following the news on Friday, the S&P 500 Index slipped less than a point to 2,126.15 at 4 p.m. in New York. It wandered today in its narrowest range in seven weeks while capping a third straight monthly decline, its biggest since a plunge in January.
     While the benchmark for American equity remains mired in its tightest range since 2006, investors are bracing for an end to malaise that sent a cross-asset gauge of price swings to the lowest since 2014. Just four months removed from the U.K.’s shock decision to leave the European Union in an outcome not predicted by betting markets, anxiety levels have spiked in the final week of an election season marked by twists that have seen Clinton’s once dominant lead over Republican Donald Trump wither in the latest polls.
     “It’s natural for an institution to want to put some hedges on, given how close the election is and how much uncertainty has arisen recently,” John Fox, director of research at Fenimore Asset Management Inc. in Cobleskill, New York, who helps oversee more than $2 billion, said by phone. “We’ve also heard plenty of talk from individual retail investors that they want to be protected heading into next Tuesday. We got a great lesson from the U.K. that polls can be wrong.”
     The CBOE Equity Put/Call Ratio climbed to 0.78 on Friday, the highest since June and also matching a level reached in September. The measure has seen an average of 0.63 since July 8, a period over which the S&P 500 has been locked in a 64-point range.
     Open interest on put contracts for the SPDR S&P 500 ETF has swelled to about double the same measure for calls, close to the most since April, according data compiled by Bloomberg. That’s high relative to the the average ratio of 1.75 for the past six months.
     Beyond politics, investors weighed data on consumer spending, which did little to alter interest-rate bets as the Federal Reserve prepares to meet, while fresh deal-making boosted industrial shares. Despite the session’s muted moves, the CBOE Volatility Index rose 5.4 percent, bringing its October climb to 28 percent, the most since August 2015.
     “Investors will try to digest the implications of the latest twist in the U.S. election theater and will focus on Wednesday’s Fed meeting,” said Ralf Zimmerman, an equity strategist at Bankhaus Lampe KG based in Dusseldorf, Germany. “Earnings are stabilizing and picking up a bit but valuations are stretched.”
     The S&P 500 has been stuck in a trading range after reaching a record in August, as investors assess the political landscape, the likely trajectory of interest rates, corporate profits and economic data. It hasn’t climbed for three consecutive sessions in more than a month, oscillating between daily gains and losses, while trading at close to 18 times forecast earnings, the highest since 2009.
     In Monday’s trading, Baker Hughes Inc. fell as crude oil dropped to a one-month low, erasing an early gain after General Electric Co. agreed to combine their oil and gas businesses, the latest in a series of deals that has October on pace for the busiest month for mergers and acquisitions in at least 12 years. Level 3 Communications Inc. climbed to a three-month high after agreeing to a $34 billion cash-and-stock takeover offer from CenturyLink Inc., which dropped the most since 2013.
     Among companies moving on earnings news, Zimmer Biomet Holdings Inc. tumbled the most since 2007 after trimming its outlook, dragging health-care shares lower. Loews Corp. saw its biggest jump in five years as its profit surged on improved results at insurance unit CNA Financial Corp. The Dow Jones Industrial Average fell 18.77 points to 18,142.42. About 6.8 billion shares traded hands on U.S. exchanges, 4 percent above the three-month average.
     Data today showed consumer purchases climbed in September by the most in three months as incomes grew, signaling momentum in the biggest part of the U.S. economy. Investors will also look for signs of stronger growth this week in gauges on manufacturing and monthly payrolls. The odds on a December rate increase are 71 percent. Traders are pricing in a 16 percent chance the central bank will act this week before the Nov. 8 presidential election.
     “I think that the market is focusing on fundamentals and the fundamentals are relatively good,” said Kevin Caron, a Florham Park, New Jersey-based market strategist and portfolio manager who helps oversee $180 billion at Stifel Nicolaus & Co.
     “We’re going to get employment data at the end of the week which will probably tell us that the economy is in growth mode. It’s been positive, it’s been steady and this morning’s numbers contribute more to that picture.”
     With more than half of S&P 500 members having reported quarterly results, analysts now expect earnings growth of 1.6 percent for the benchmark, reversing forecasts for a 1.6 percent decline at the start of the month. If the prediction holds, it will end the longest earnings recession since the financial crisis. Companies releasing results this week include Pfizer Inc., Gilead Sciences Inc., Facebook Inc., Kraft Heinz Co. and Starbucks Corp.

 

Have  a wonderful evening everyone.

 

Be magnificent!

Man falls from the pursuit of the ideal of plain living and high thinking
the moment he  wants to multiply his daily 3wants.  Man’s happiness really lies in contentment.
Mahatma Gandhi

As ever,
 

Carolann

 

The most authentic thing about us is our capacity to create, to overcome,
to endure, to transform, to love and to be greater than our suffering.
                                                                            -Ben Okri. B. 1959

 

Carolann Steinhoff, B.Sc., CFP®, CIM, CIWM
Portfolio Manager &
Senior Vice-President

Queensbury Securities Inc.,
St. Andrew’s Square,
Suite 340A, 730 View St.,
Victoria, B.C. V8W 3Y7

Tel: 778.430.5808
(C): 250.881.0801
Toll Free: 1.877.430.5895
Fax: 778.430.5828
www.carolannsteinhoff.com

Dear Friends,

Tangents:

We have a Japanese maple tree which is planted near the entrance to our house – it is a dazzling thing to see at this time of year as the leaves have turned iridescent scarlet.  I always look forward to autumn – because I know the beauty the season brings as it transforms nature.  I love this poem that Jackie Kennedy wrote (she was still Jacqueline Bouvier at the time she wrote it in 1943):

THOUGHTS
  –by Jacqueline Bouvier

I love the Autumn.
And yet I cannot say
All the thoughts and things
That make one feel this way.

I love walking on the angry shore;
To watch the angry sea;
Where summer people were before
But now there’s only me.

I love wood fires at night
That have a ruddy glow.
I stare at the flames
And think of long ago.

I love the feeling down inside me
That says to run away
To come and be a gypsy
And laugh the gypsy way.

The tangy taste of apples,
The snowy mist at morn,
The wanderlust inside you
When you hear the huntsman’s horn.

Nostalgia – that’s Autumn,
Dreaming through September
Just a million lovely things
I always will remember.
                             -1943

On Oct. 28, 1886, the Statue of Liberty, a gift from the people of France, was dedicated in New York Harbor by President Grover Cleveland.
Also on this day in 1962, Soviet Union leader Nikita Khrushchev agrees to remove Russian missiles from Cuba, ending the Cuban Missile crisis.

PHOTOS OF THE DAY

A cyclist rides through an autumn colored landscape near Dormagen, western Germany, on Friday. Federico Gambarini/dpa/AP
A man walks on Thufa hill in Reykjavik, Iceland, on Friday. Parliamentary elections will be held in Iceland on Saturday. More than 250,000 voters will elect the new 63-member Parliament. Frank Augstein/AP

A rainbow appears shortly after dawn in Santa Monica as one of a series of storms sweeps through California on Friday. Reed Saxon/AP
Market Closes for October 28^th, 2016

Market Index	Close	Change
Dow Jones	18161.19	-8.49   -0.05%
S&P 500	2126.41	-6.63   -0.31%
NASDAQ	5190.105	-25.869   -0.50%
TSX	14785.29	-48.47
		-0.33%

International Markets

Market Index	Close	Change
NIKKEI	17446.41	+109.99
		+0.63%
HANG SENG	22954.81	-177.54
		-0.77%
SENSEX	27941.51	+25.61
		+0.09%
FTSE 100	6996.26	+9.69
		+0.14%

Bonds

Bonds		% Yield		Previous  % Yield
CND. 10 Year Bond		1.229		1.238
CND. 30 Year Bond		1.891		1.893
U.S.    10 Year Bond		1.8468		1.8536
U.S. 30 Year Bond		2.6154		2.6138

Currencies

BOC Close	Today	Previous
Canadian $	0.74646	0.74649
US $	1.33966	1.33961
Euro Rate 1 Euro=		Inverse
Canadian $	1.47180	0.67944
US $	1.09863	0.91022

Commodities

Gold	Close	Previous
London Gold Fix	1273.00	1266.25
Oil	Close	Previous
WTI Crude Future	48.70	49.72

Market Commentary:
Number of the Day
$248.9 billion
The value merger agreements struck this month for U.S. companies, according to Dealogic, surpassing the previous record of $240 billion in July 2015.
Canada
By John Hyland
     (Bloomberg) — Canadian stocks declined after the nation’s largest industries slumped amid global concerns, ranging from OPEC production cuts to the U.S. presidential election.
     The S&P/TSX Composite Index fell 0.3 percent to 14,785.29 at 4 p.m. in Toronto, erasing an advance in afternoon trading after the U.S. Federal Bureau of Investigation said it’s reopening an inquiry into Hillary Clinton’s use of private e- mail. The gauge lost 1 percent for the week, with health-care and real estate shares taking the biggest hits. The S&P/TSX is up almost 14 percent in 2016, the top performance among developed equity markets tracked by Bloomberg.
     Financial stocks fell 0.4 percent as four of the largest banks declined, while Manulife Financial Corp. slumped 1.3 percent, the most in a month. Energy producers lost 1.2 percent as crude tumbled in New York to the lowest in almost four weeks. The losses came as an OPEC committee discussed production targets and as U.S. equities dropped after the FBI disclosed the renewed probe into the Clinton e-mails.
     Suncor Energy Inc., Canada’s biggest energy producer, slumped 0.8 percent, falling from a one-year high. The oil-sands giant swung to a profit in the third quarter after restoring operations that were shut during the Alberta wildfires in May.
     Health-care companies fell 4.6 percent to a four-month low. The sector was dragged down by Valeant Pharmaceuticals International Inc., after the company fell 8 percent to its lowest level since July amid a selloff in U.S. drugmakers. Health-care was the worst-performing sector this week, and is down 73 percent this year, the most ever.
     Raw-materials producers rallied after as a weaker dollar boosted demand for metals as a haven. Barrick Gold Corp., the world’s biggest bullion miner, added 1.5 percent after beating earnings expectations. Goldcorp Inc. gained 0.7 percent.
     Six of the 11 sectors in the benchmark rose today, led by 0.5 percent gains in utilities and raw materials. Utilities reached a five-week high, with Fortis Inc. and Brookfield Renewable Partners LP gaining at least 1 percent.
     Canadian stocks are now 17 percent more expensive than their peers in the S&P 500 Index. The S&P/TSX trades at 23 times earnings, compared with 20 for the S&P 500 Index.
US
By Joseph Ciolli and Anna-Louise Jackson
     (Bloomberg) — U.S. stocks declined, with the S&P 500 Index falling to a six-week low, after the Federal Bureau of Investigation reopened a probe into Hillary Clinton’s use of an unauthorized e-mail server.
     Word of the FBI’s renewed investigation rattled investors, wiping out gains as equities careened down from the day’s highs. An earlier advance came as data bolstered speculation a stronger economy may lift corporate earnings, while rallies in Alphabet Inc. and Chevron Corp. overshadowed a selloff among drugmakers.
     The S&P 500 fell 0.3 percent to 2,126.41 at 4 p.m. in New York, erasing a 0.4 percent advance. The gauge fell as much as 0.6 percent and extended the longest losing streak since June. The Dow Jones Industrial Average slipped 8.49 points to 18,161.19, after reversing a 0.5 percent climb. The Nasdaq Composite Index dropped 0.5 percent, joining the S&P 500 at a six-week low. About 7.4 billion shares traded hands on U.S. exchanges, 14 percent above the three-month average.
     “Clinton is clearly priced to win, and anything that disrupts the market’s predictions will have an adverse reaction,” said Michael Antonelli, an institutional equity sales trader and managing director at Robert W. Baird & Co. in Milwaukee. “The market has to re-price for a new level of uncertainty, and we’re now dealing with a big heaping teaspoon of it. It has to change its probabilities and change how it’s thinking.”
     It’s not the first time U.S. stocks have been sensitive to perceptions about Clinton’s political prospects. Futures on the S&P 500 rallied three-quarters of a percent during the first presidential debate, when her odds of winning shot up on online prediction markets. A win by Donald Trump “would reduce the value of the S&P 500, the U.K., and Asian stock markets by 10-15%,” economics professors Justin Wolfers and Eric Zitzewitz say in paper released by Brookings Institute.
     “The FBI has learned of the existence of emails that appear to be pertinent to the investigation,” FBI Director James Comey said in a letter to eight committee chairmen in Congress. “I agreed that the FBI should take appropriate investigative steps designed to allow investigators to review these emails to determine whether they contain classified information.”
     Equity markets have been wagering on a Clinton victory, with the latest RealClear Politics poll average showing her with an advantage of about 5 points. Stocks have been stuck in a range of about 65 points since August as the looming presidential election and expectations for higher interest rates upstage a recovery in corporate profits. The S&P 500 capped a third weekly decline in four, losing 0.7 percent.
     “What it says to me is that the market is pretty fragile here and that any bit of small news can tip this thing,” Peter Cecchini, co-head of equities and chief market strategist at Cantor Fitzgerald, said in an interview on Bloomberg Television. “A Trump victory would be quite disruptive to the market because of the uncertainty.”
     Following the Clinton news, traders pared bets on a December interest-rate increase by the Federal Reserve, with odds slipping to 70 percent from 74 percent earlier. They’re pricing in a less than 20 percent chance the central bank will act at next week’s meeting, just days before the U.S. vote.
     A report today showed gross domestic product increased the most in two years last quarter as a build in inventories and a soybean-related jump in exports helped cushion softer household spending. Separately, consumer confidence dropped more than previously reported to match the lowest level since 2014.
     “This confirms further the acceleration in the economy that will give the Fed further confidence to raise rates in December,” said Michael Arone, the Boston-based chief investment strategist at State Street Global Advisors’ U.S. intermediary business. “It was good to see some additional contributions to GDP from something other than the consumer — we’ve been looking for that to broaden the growth and it looks like we got some signs of that here in the third quarter.”
     As one of the busiest weeks of the earnings season draws to a close, 78 percent of S&P 500 firms that reported this season beat profit projections and 58 percent topped sales estimates. Analysts now expect quarterly earnings growth of 1.6 percent for benchmark members, reversing forecasts for a 1.6 percent decline at the start of the month. If the prediction holds, it will end the longest earnings recession since the financial crisis.
     Prior to the afternoon swoon, equities were cruising higher on gains from Google parent Alphabet and Chevron’s strongest rally since March, as investors cheered their quarterly results. Those moves had been enough to overcome Amazon.com Inc.’s steepest drop in eight months on a disappointing outlook, and as drug distributor McKesson Corp. plunged the most since 1999 to lead health-care lower.
     Among other shares moving on earnings news:
     * Hershey Co. rose the most since June after boosting its full- year earnings forecast.
     * AbbVie Inc. sank 6.3 percent after its profit narrowly beat analysts’ estimates, while its top-selling arthritis injection, Humira, fell short of predictions.
     * Amgen Inc. suffered its steepest drop in 15 years after sales of the company’s biggest product fell amid increasing price pressure.
     * Mastercard Inc. gained 3.2 percent to a record as profit and revenue beat predictions at the second-largest U.S. payments network.
     Bucking a historical trend that has seen October post the biggest gains on average of any month over the past 25 years, the S&P 500 is on its way to a decline. It’s down 1.9 percent for the period, the worst since a plunge at the start of the year.
     In Friday’s trading, five of the S&P 500’s 11 main industries rose, led by a 0.7 percent gain in industrials. Health-care fell 2.2 percent to a seven-month low. The CBOE Volatility Index increased 5.4 percent, stretching gains to a fourth day, the most since August. The measure of market turbulence known as the VIX climbed 21 percent for the week.
     Honeywell International Inc. and United Technologies Corp. added more than 0.9 percent to join General Electric Co. in powering the industrials. GE rose 2.1 percent after saying it’s in discussions with Baker Hughes Inc. to form unspecified partnerships. Fortive Corp. and Stericycle Inc. jumped more than 5.7 percent after their profits topped forecasts.
     McKesson’s 23 percent tumble led health-care lower, after cutting its annual forecast in response to aggressive price competition. That dragged down competitors, with AmerisourceBergen Corp. and Cardinal Health Inc. slumping more than 9.7 percent, the biggest declines for each in at least seven years. Merck & Co. slid 4 percent, the most in 14 months.
Have a wonderful weekend everyone.

 

Be magnificent!

To understand pleasure is not to deny it.
We are not condemning it or saying it is right or wrong but if we pursue it,
let us do so with our eyes open, knowing that a mind that is all the time seeking pleasure
must inevitably find its shadow in pain.
They cannot be separated, although we run after pleasure and try to avoid pain.
Krishnamurti

As ever,

 

Carolann

 

The immortal gods alone have neither age nor death.
All other things almighty Time disturbs.
                         -Sophocles, 498 BC-406 BC

 

Carolann Steinhoff, B.Sc., CFP®, CIM, CIWM
Portfolio Manager &
Senior Vice-President

Queensbury Securities Inc.,
St. Andrew’s Square,
Suite 340A, 730 View St.,
Victoria, B.C. V8W 3Y7

Tel: 778.430.5808
(C): 250.881.0801
Toll Free: 1.877.430.5895
Fax: 778.430.5828
www.carolannsteinhoff.com

 

Dear Friends,

Tangents:
On this day in 1904, the first subway line opens in New York City.

Don’t talk,
Just act.
Don’t say,
Just show.
Don’t promise,
Just prove.

PHOTOS OF THE DAY

Workers pick squash on a snowy autumn morning in Kinderhook, N.Y., on Thursday. Mike Groll/AP

Women take photos in front of a large photo of a MacBook computer in a demo room following the announcement of new products at Apple headquarters on Thursday in Cupertino, Calif. Marcio Jose Sanchez/AP

A cameraman looks at the sculpture ‘Large Head’ during a media preview of the exhibition ‘Alberto Giacometti – Material and Vision,’ by the late Swiss artist, at the Kunsthaus Zürich art museum in Switzerland on Thursday. Arnd Wiegmann/Reuters

Market Closes for October 27^th, 2016

Market Index	Close	Change
Dow Jones	18169.68	-29.65     -0.16%
		S&P 500	2133.04	-6.39   -0.30%
NASDAQ	5215.975			-34.293   -0.65%
		TSX	14833.75	+26.19
+0.18%

International Markets

Market Index	Close	Change
NIKKEI	17336.42	-55.42
		-0.32%
HANG SENG	23132.35	-193.08
		-0.83%
SENSEX	27915.90	+79.39
		+0.29%
FTSE 100	6986.57	+28.48
		+0.41%

Bonds

Bonds	% Yield	Previous  % Yield
10 Year Bond	1.238	1.157
30 Year  Bond	1.893	1.826
U.S.    10 Year Bond	1.8536	1.7896
U.S. 30 Year Bond	2.6138	2.5389

Currencies

BOC Close	Today	Previous
Canadian $	0.74649	0.74756
US $	1.33961	1.33768
Euro Rate 1 Euro=		Inverse
Canadian $	1.45936	0.68523
US $	1.08939	0.91794

Commodities

Gold	Close	Previous
London Gold Fix	1266.25	1270.50
Oil	Close	Previous
WTI Crude Future	49.72	49.18

Market Commentary:
Number of the Day
$100 billion
The amount that Carlyle said it expects to raise for its funds in the next several years.
Canada
By Eric Lam
     (Bloomberg) — Canadian stocks rose Thursday, snapping a three-day slide as some key companies posted healthy earnings and crude bounced back from the lowest levels in three weeks.
     The S&P/TSX Composite Index rose 0.2 percent to 14,833.75 at 4 p.m. in Toronto. The index had fallen 0.9 percent in the three sessions since closing at a 15-month high on Friday. The equity benchmark is up 14 percent in 2016, the top performance among developed equity markets tracked by Bloomberg.
     Energy producers rallied 1.3 percent to lead gains among five of 11 industries in the S&P/TSX. Crude added 0.9 percent in New York, settling just below $50 a barrel. Reuters reported Saudi Arabia and its Persian Gulf allies are willing to cut 4 percent from their peak oil output. OPEC Secretary-General Mohammed Barkindo urged members to show “maximum flexibility” to agree on output cuts as the group meets later this month.
     Suncor Energy Inc., Canada’s biggest energy producer, climbed 5.7 percent to the highest in two years as the oil-sands giant swung to a profit in the third quarter after restoring operations that were shut during the Alberta wildfires in May. Suncor’s results herald possible improvements in earnings among Canadian energy producers amid the resurgence in petroleum prices this year. Crude has rebounded about 90 percent since February when it fell to its lowest level since 2003.
     Barrick Gold Corp., the world’s biggest bullion miner, added 1.2 percent after beating earnings expectations. Barrick has cut its debt load by $1.4 billion this year and is on track to reach its reduction targets. It also raised its full-year production guidance. Rival Goldcorp Inc. slipped 3.7 percent for its worst slide in three weeks as production fell due to a lengthy work stoppage at one of its mines in Argentina.
     Teck Resources Ltd., Canada’s largest diversified miner, ended the day down 0.6 percent after swinging between gains and losses. The company reported adjusted earnings of 26 cents a share that fell just short of the 28 cents analysts had anticipated as coal production rose less than expected and copper output declined. Teck posted third-quarter net profits of C$234 million ($174.8 million) compared with a loss of C$2.15 billion a year earlier. Teck is the best-performing stock in Canada year-to-date since 2009, with a five-fold increase fueled by rallying metallurgical coal and zinc prices.
     Canadian stocks are now 17 percent more expensive than their peers in the S&P 500 Index. The S&P/TSX trades at 23.4 times earnings, compared with compared with 20 for the S&P 500.

US
By John Hyland and Anna-Louise Jackson
     (Bloomberg) — The looming presidential election and expectations for higher borrowing costs by year end are taking all the joy out of a recovery in corporate profits.
     The best earnings season in six quarters hasn’t been able to shake stocks from a three-month stupor. While companies beat analyst estimates by an average of almost 6 percent in the 15 days since Alcoa Inc. kicked off reporting, the S&P 500 Index has barely budged, notching its smallest move over the comparable period since the first quarter 2015.
     The main benchmark for U.S. equity fell 0.3 percent to 2,133.04 as of 4 p.m. in New York. Losses steepened in afternoon trading, paced by declines in retailers and media companies. The index is down 0.2 percent during the earnings season with less than two weeks until the Federal Reserve’s next meeting and the Nov. 8 presidential election.
     Uncertainty surrounding the political outcome has companies and investors sitting on their hands, said Michael Cuggino, president and portfolio manager of Pacific Heights Asset Management LLC, with $3 billion in assets. “There is this general sense of, ‘Let’s wait until some of those questions are answered a little bit to take on that incremental business project or that business development activity,’ so I think you have that weighing on people, as well. The Fed, again is a wild card.”
     Earnings reports torpedoed small-cap stocks on Thursday, sending the Russell 2000 Index to a more than three-month low. Community Health Systems Inc. plummeted to an all-time low, losing half its value after the struggling hospital chain’s preliminary results missed estimates. GNC Holdings Inc. and Cliffs Natural Resources Inc. slumped more than 18 percent after their results disappointed.
     While the majority of profit reports have been better than expected, investors’ wariness before the election, coupled with lackluster outlooks from companies including Intel Corp., Apple Inc. and 3M Co., have kept equity gains in check this season. The S&P 500 hasn’t climbed for more than two straight days in five weeks, on its way to a third monthly decline and the worst since January. The benchmark trades at 18 times forecast earnings, the highest since 2009.
     The air of caution approaching the November vote isn’t unwarranted. Should Democrats gain control of Congress in a wave election, the results would lower the S&P 500 two percent in the first month, and four percent over three months, according to a report by Goldman Sachs Group. In a non-wave election, the index is poised to gain six percent in the first three months.
     Meanwhile, traders are pricing in less than one-in-five odds of an increase at next week’s meeting, which takes place days before voters decide between Democrat Hillary Clinton and Republican Donald Trump. The probability for a December move is seen at 74 percent.
     “As we approach the election, the apprehension gets even greater and I think that can be alleviated by the polls — the more the polls start to show Hillary’s lead expanding or being more solidified, the more likely the market might be to creep higher,” said Randy Frederick, managing director of trading and derivatives at Charles Schwab Corp. “As the polls show her lead widening, if that happens, then the market could very well ease into and sort of front-run the election and move higher ahead of it.”
     The 261 companies in the S&P 500 that have reported third- quarter results grew profits by an average 2.7 percent over the past year, according to data compiled by Bloomberg. Analysts now expect year-over-year profit will be flat once the June- September reporting is finished, likely bringing an end to the longest earnings recession since the financial crisis.
     In Thursday’s trading, optimism on better-than-forecast profits from companies including Bristol-Myers Squibb Co. and Dow Chemical Co. was tempered by declines in United Parcel Service Inc. and Simon Property Group Inc. after their reports. Utilities and consumer staples slipped as a rout in bonds damped demand for equities with high dividend payouts. About 7.2 billion shares traded hands on U.S. exchanges, 11 percent above the three-month average.
     The Dow Jones Industrial Average lost 29.65 points, or 0.2 percent, to 18,169.68, after wavering between gains and losses as the dollar strengthened while the yield on the 10-year Treasury note jumped on speculation monetary policy will tighten this year. The Nasdaq 100 Index retreated 0.5 percent, weighed by a second day of post-earnings declines in Apple Inc. and Comcast Corp.
     After markets closed, Amazon.com Inc. projected fourth- quarter sales that may miss estimates, sending its shares down 4.4 percent as of 4:34 p.m. in after-hours trading. Google parent Alphabet Inc. edged up 0.5 percent in the late session after its results topped analysts’ forecasts, bolstered by a steady internet ad business.
     “It seems to me that we’re probably in a holding pattern in equities,” said Mark Heppenstall, the Horsham, Pennsylvania- based chief investment officer of Penn Mutual Asset Management, which oversees about $20 billion. “Earnings — some disappointments, some beating expectations, but nothing to get positive momentum.”
     Among shares moving on corporate news today, Qualcomm Inc. rose 2.8 percent to a five-month high after the largest maker of mobile-phone chips agreed to acquire NXP Semiconductors NV in a transaction valued at $47 billion, aiming to speed an expansion into new industries and reduce its dependence on the smartphone market.
     CenturyLink Inc. surged as much as 18 percent, before closing with a 9.7 percent gain as people familiar with the matter said the company is in talks to acquire Level 3 Communications Inc., a deal that would create a more formidable competitor in the market for business telecommunications services.

 

Have a wonderful evening everyone.

 

Be magnificent!

We would be happy to do the millions of things that we are not able to do.
The will is there, but we are not able to fulfill our desire.  Thus when we feel a desire, but we are unable to realize that desire, we undergo a reaction we call suffering.
What is the cause of desire?  I am, only me.
As a result, I myself am the cause of all of the suffering that I have known.
Swami Vivekananda

As ever,
 

Carolann

 

Is man by nature morally good or evil?  Neither, for he is by nature not a moral being;
he only becomes such when his reason is raised to the concepts of duty and law   
                                                                         -Immanuel Kant, 1724-1804

 

Carolann Steinhoff, B.Sc., CFP®, CIM, CIWM
Portfolio Manager &
Senior Vice-President

Queensbury Securities Inc.,
St. Andrew’s Square,
Suite 340A, 730 View St.,
Victoria, B.C. V8W 3Y7

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