Category: Newsletters

Dear Friends,

Tangents:

It’s serendipitous that I came across these words by Albert Schweitzer a few moments ago…

“You must give some time to your fellow men.  Even if it’s a little thing, do something for others – something for which you get no pay but the privilege of doing it.”

–Albert Schweitzer.

Today is the philosopher, Albert Schweitzer’s birthday.  He was born on January 14^th, in 1869.

I was thinking of my husband Gary, who is spending the evening tonight giving a talk to a couple of hundred folks and then doing a Q & A on the subject of sexual dysfunction after prostate cancer and what can be done about it.  Just because he can, for no compensation, after a very long day of seeing patients at the office and then at the cysto clinic.  I marvel at his incredible giving nature and caring disposition.

It made me think of something I read in the Wall Street Journal this past weekend by economist Donald Boudreaux:

“Suppose that Jones chooses a career as a poet. Jones treasures the time he spends walking in the woods and strolling city streets in leisurely reflection; his reflections lead him to write poetry critical of capitalist materialism. Working as a poet, Jones earns $20,000 annually.

Smith chooses a career as an emergency-room physician. She works an average of 60 hours weekly and seldom takes a vacation. Her annual salary is $400,000. Is this “distribution” of income unfair? Is Smith responsible for Jones’ relatively low salary? Does Smith owe Jones money? If so, how much? And what is the formula you use to determine Smith’s debt to Jones?

While Dr. Smith earns more money than does poet Jones, poet Jones earns more leisure than does Dr. Smith. Do you believe leisure has value to those who possess it? If so, are you disturbed by the inequality of leisure that separates leisure-rich Jones from leisure-poor Smith? Do you advocate policies to “redistribute” leisure from Jones to Smith—say, by forcing Jones to wash Smith’s dinner dishes or to chauffeur Smith to and from work? If not, why not?”

Photo of the day

A dog looks at a couple kissing on the beach in Nice, France. Temperatures on the French Riviera reached 54 degrees Fahrenheit. Lionel Cironneau/AP

Market Closes for January 14^th, 2014

Market  Index	Close	Change
Dow  Jones	16373.86	+115.92    +0.71%
S&P 500	1838.88	+19.68    +1.08%
NASDAQ	4183.016	+69.711   +1.69%
TSX	13692.38	+10.90
		+0.08%

International Markets

Market  Index	Close	Change
NIKKEI	15422.40	-489.66
		-3.08%
HANG  SENG	22791.28	-97.48
		-0.43%
SENSEX	21032.88	-101.33
		-0.48%
FTSE 100	6766.86	+9.71
		+0.14%

Bonds

Bonds	% Yield	Previous % Yield
CND.  10 Year Bond	2.579	2.544
CND.   30 Year Bond	3.122	3.094
U.S.   10 Year Bond	2.8709	2.8257
U.S.   30 Year Bond	3.8035	3.7726

Currencies

BOC Close	Today	Previous
Canadian $	0.91305	0.91875
US   $	1.09524	1.08843
Euro Rate  1 Euro=		Inverse
Canadian   $	1.49742	0.66781
US  $	1.36722	0.73141

Commodities

Gold	Close	Previous
London Gold   Fix	1245.14	1253.28
Oil	Close	Previous
WTI Crude Future	92.59	91.80
BRENT	109.360	109.360

Market Commentary:

Canada

By Eric Lam

Jan. 14 (Bloomberg) — Canadian stocks rose, rebounding from the worst drop in a month yesterday, as Corus Entertainment Inc. posted higher-than-estimated profit and Bank of America Corp. advised buying Thompson Creek Metals Co. shares.

Corus Entertainment, which operates television stations, climbed 3.3 percent. Thompson Creek surged 19 percent after Bank of America raised its rating on the stock to buy from underperform. Canexus Corp., a chemical maker, sank 12 percent after saying costs for a train expansion will be about 40 percent higher than previous forecasts. Pinecrest Energy Inc. plunged 41 percent after production in December fell short of previous guidance.

The Standard & Poor’s/TSX Composite Index rose 10.90 points, or 0.1 percent, to 13,692.38 at 4 p.m. in Toronto. The benchmark equity gauge has advanced 0.5 percent this year.

“We’re getting a little bit of a bounce back from yesterday’s pretty weak day and also retail sales in the U.S. were higher than estimated,” said Anish Chopra, fund manager at TD Asset Management Inc. in Toronto. He helps manage C$218.3 billion ($199.6 billion) with the firm. “Earnings that exceed expectations are a fantastic backdrop for stronger market performance.”

U.S. retail sales increased 0.2 percent in December, exceeding the median forecast for a 0.1 percent gain, according to a Bloomberg survey of analysts.

“Canadian equities have more elbow room, with current valuations not as stretched as those stateside,” said Avery Shenfeld, chief economist with CIBC World Markets, in a note to clients. “The TSX has outperformed the S&P in each of the last six years in which global growth has topped 4 percent, and 2014 should add to that streak.”

Raw-materials stocks rose 0.6 percent as a group. Six of 10 industries in the S&P/TSX advanced on trading volume 31 percent higher compared with the 30-day average.

Thompson Creek surged 19 percent to C$2.82. The company reported yesterday that molybdenum production climbed 34 percent to 30 million pounds in 2013. The stock has four buys, eight holds and four sell ratings from analysts, according to data compiled by Bloomberg. The stock’s 12-month share-price target is C$3.27, implying a 16 percent rally from current levels.

Allied Nevada Gold Corp. soared 7 percent to C$5.02 after China Gold Stone Mining Development Ltd. retracted a $779.6 million offer for the company that it said was published in error.

Allied Nevada said it received a letter from closely held China Gold Stone yesterday, which included the proposed offer.

The stock jumped as much as 52 percent to $6.55 in pre-market trading in New York before Allied Nevada halted trading. The company said it questioned the credibility of the bid.

Telephone stocks rallied after Wind Mobile yesterday withdrew from a spectrum auction. The company’s principal backer, VimpelCom Ltd., decided not to fund its bid, Wind Chief Executive Officer Anthony Lacavera said in an e-mail.

The mobile-phone company’s exit ruins the government’s plans to open the market to more competitors, said David Heger, a St. Louis-based analyst with Edward Jones & Co.

Rogers Communications Inc. increased 1.7 percent to C$47.86, Telus Corp. added 0.7 percent to C$37.03 and BCE Inc. rose 0.7 percent to C$46.72. Telephone stocks rallied 0.8 percent as a group in the S&P/TSX.

Corus Entertainment added 3.3 percent to C$25.40 after reporting first-quarter earnings of 65 Canadian cents a share, higher than the average estimate of 62 cents. The media company also raised its dividend 6.9 percent for Class A and Class B shares, to an annual payout of C$1.085 and C$1.09 respectively.

Canexus plunged 12 percent to C$6.57, the biggest decline since November 2008. The firm said its pipeline connected train expansion will now cost about C$315 million, more than the earlier estimate of C$225 million. The company plans to pay for the rising costs using its credit facilities and the project remains on track for completion in mid 2014.

Pinecrest Energy sank 41 percent to 22 Canadian cents, the lowest close in its history. The Calgary-based company said it averaged production of 2,308 barrels of oil equivalent per day in December, below previous guidance. Pinecrest cited bigger- than-expected declines at three of its drilled wells.

USA

By Lu Wang and Callie Bost

Jan. 14 (Bloomberg) — U.S. stocks rose, giving the Standard & Poor’s 500 Index its biggest gain of the year, as better-than-forecast retail sales and corporate merger activity signaled confidence in the economy.

Intel Corp. and Jabil Circuit Inc. paced gains among technology companies, rising at least 4 percent amid analyst upgrades. Google Inc. added 2.4 percent after agreeing to buy digital-thermostat maker Nest Labs Inc. for $3.2 billion in cash. Time Warner Cable Inc. climbed 2.7 percent after rejecting an acquisition offer from Charter Communications Inc. JPMorgan Chase & Co. and Wells Fargo & Co. were little changed after reporting fourth-quarter results.

The S&P 500 added 1.1 percent to 1,838.88 at 4 p.m. in New York, posting the biggest jump since Dec. 18 and erasing most of yesterday’s loss. The Dow Jones Industrial Average gained 115.92 points, or 0.7 percent, to 16,373.86. About 6.5 billion shares changed hands on U.S. exchanges, 7.7 percent above the 30-day average.

“We’re probably at the stage in the stock market cycle where good news will continue to be seen as good news,” Martin Leclerc, founder of Barrack Yard Advisors LLC, which oversees $270 million, said in a telephone interview. “I would say that after this massive move we’ve had, it does feel like the animal spirits are still resurrected.”

The S&P 500 fell 1.3 percent yesterday, the most since November, as investors weighed valuations after a 30 percent rally last year that sent the gauge to a record. The benchmark index dropped 1.6 percent in January through yesterday for the worst start to a year since 2009.

The index trades at 15.6 times the estimated earnings of its members, more than the average multiple of 14.1 over the last five years, data compiled by Bloomberg show. The S&P 500 ended 2013 at its highest valuation since the end of 2009.

Wells Fargo and JPMorgan are among companies reporting financial results today. Bank of America Corp., Citigroup Inc. and Goldman Sachs Group Inc. report later this week. Earnings for companies in the index probably climbed 4.9 percent on average in the fourth quarter, while sales increased 1.8 percent, according to analyst estimates compiled by Bloomberg.

“Earnings are going to dominate for the next two or three weeks,” Patrick Kaser, a managing director and portfolio manager at Brandywine Global Investment Management in Philadelphia, said by phone. His firm oversees about $50 billion. “People are concerned about the rate of growth in the economy. How we finished the quarter going into January, that’s going to matter the most for where we are right now.”

U.S. retail sales increased 0.2 percent after a 0.4 percent advance in November that was smaller than previously reported, Commerce Department figures showed today in Washington. The median forecast of 86 economists surveyed by Bloomberg called for a 0.1 percent gain. Excluding cars, demand jumped by the most in almost a year.

Investors are watching economic data for signals on the pace of Federal Reserve stimulus cuts. Three rounds of monetary stimulus from the central bank have helped push the S&P 500 higher by 172 percent from a 12-year low in 2009. The Fed, which next meets Jan. 28-29, last month announced a reduction in its monthly bond-buying program, citing a recovery in the labor market.

A government report on Jan. 10 showed employment rose in December at the slowest pace in almost three years. The data ended months of improving job growth that had signaled the world’s largest economy was picking up.

Stocks extended losses yesterday after Fed Bank of Atlanta President Dennis Lockhart said weak payroll growth last month shouldn’t discourage policy makers from reducing monthly bond purchases as long as the economy continues to gain strength.

Philadelphia Fed President Charles Plosser said today that the central bank’s stimulus program should end later this year because the economy is on a “firmer footing” than it has been in the past several years.

Richard Fisher, Fed president in Dallas, likened quantitative easing to “beer goggles” that makes everything look good. There are signs that “we have made for an intoxicating brew as we have continued pouring liquidity down the economy’s throat,” he said in a speech today.

The Chicago Board Options Exchange Volatility Index, which measures expected swings on the S&P 500 using options prices, dropped 7.5 percent today to 12.28. The gauge is down 11 percent this year.

All 10 main industries in the S&P 500 advanced. The Morgan Stanley Cyclical Index climbed 1.4 percent, reversing a 1.4 percent drop yesterday. The Dow Jones Transportation Average added 1.3 percent, the most since Oct. 16. Microsoft Corp., Visa Inc., 3M Co. and Walt Disney Co. increased at least 1.6 percent to pace gains among the largest companies.

The Nasdaq-100 Index jumped 1.9 percent, the most since Oct. 10, as technology companies in the S&P 500 rallied 1.9 percent as a group.

Intel rose 4 percent to $26.51 for the biggest increase in the Dow. The maker of computer chips was raised to overweight from neutral by Christopher Danely, an analyst with JPMorgan Chase, on expectation the personal-computer market will remain stable this year and new Chief Executive Officer Brian Krzanich will focus on areas where Intel has an advantage.

Jabil Circuit advanced 7.8 percent to $17.89. The maker of electronics for Apple Inc. was boosted to buy from neutral by Goldman Sachs.

Google Inc. added 2.4 percent to $1,149.40, an all-time high, after saying it will buy Nest Labs. The deal is contributing to greater confidence among venture-capital firms, which often bet on companies before they have revenue or even a product.

Proposed deals by companies including Charter and Google brought the value of takeover offers worldwide this year to $130 billion, data compiled by Bloomberg show.

Time Warner Cable rose 2.7 percent to $136. The broadband- service provider’s chief executive officer, Rob Marcus, called Charter’s $132.50-a-share bid a “low-ball offer.” The proposal included about $83 cash per share and about $49.50 in stock.

Excluding debt, the deal would have been worth $37.3 billion.

Intuitive Surgical Inc. rallied 6.8 percent to $419.88. The maker of robot surgery systems said fourth-quarter revenue was $576 million, beating the average analyst estimate of $549.1 million in a Bloomberg survey.

Regeneron Pharmaceuticals Inc. jumped 12 percent to $300.32 for the biggest increase in the S&P 500. Sales of the eye drug Eylea, the company’s top-selling product, were about $400 million last quarter, Chief Executive Officer Len Schleifer said. That exceeded the $377.5 million average of eight analysts’ estimates compiled by Bloomberg.

Tesla Motors Inc. surged 16 percent to $161.27, the highest level in two months. The maker of high-end electric cars delivered 6,900 Model S sedans in the fourth quarter, lifting full year sales of the vehicle beyond the company’s target.

JPMorgan added less than 0.1 percent to $57.75. Quarterly profit fell 7.3 percent on $2.6 billion of settlements tied to Bernard Madoff’s Ponzi scheme as rising legal costs ended the firm’s three-year streak of record annual earnings.

Wells Fargo rose less than 0.1 percent to $45.59. The largest U.S. home lender posted record fourth-quarter and full- year profit as expense cuts and one-time gains bolstered results.

While Wells Fargo’s profit was enough to beat the consensus of Wall Street analysts, mortgage applications plunged and Oppenheimer & Co.’s Chris Kotowski said in a note to clients that results were helped by reserve releases and gains on securities.

GameStop Corp. plunged 20 percent, the most in the S&P 500, to $36.31. The largest specialty retailer of video games cut its full-year profit forecast amid lower-than-anticipated software sales and reduced gross margin from Sony Corp.’s PlayStation 4 and Microsoft Corp.’s Xbox One consoles during the holiday shopping period.

 

Have a wonderful evening everyone.

 

Be magnificent!

 

You have to stand against the whole world although you may have to stand alone.

You have to stare the world in the face although the world may look at you with a bloodshot eye.

Do not fear.

Trust that little thing in you which resides in the heart and says:

forsake friends, wife, all, but testify to that for which you have lived and for which you have to die.

Mahatma Gandhi, 1869-1948

As ever,

 

Carolann

 

It is not fair to ask of others what you are

unwilling to do yourself.

-Eleanor Roosevelt, 1884-1962.

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

Senior Vice-President &

Senior Investment Advisor

Queensbury Securities Inc.,

St. Andrew’s Square

Suite 340A, 730 View St.,

Victoria, B.C. V8W 3Y7

 

Dear Friends,

Tangents:

Blackout. Quiet.  The tick of clock

Shall bring you peace,

To your uncertain soul

Give slow increase.

The blackened windows shut

This inward room

Where you may be alone.

As in the tomb.

A tomb of life not death,

Life inward, true,

Where the world vanishes

And you are you…

 

It is not winter, not the cold we fear;

It is the dreadful echo of our void,

The malice all around us, manifest;

Loud-mouthed interpreter of constant whispers

Mostly ignored, or drowned within the song

Of cheerfulness and shallow disregard.

The athletic spirit, like a shouting boy,

Leaps to all reassurance, shuns the dour

Disquiet plucking mutely at his sleeve,

And seeks the climate native to his mind

Where day suffices day, but even he

When lowering Nature grips, must vacillate

Disconsolate before the frightful day

With a strange wonder and a strange alarm…

-by V. Sackwille-West, The Garden, Winter, 1946.

Photos of the day

People dance and sing Christmas carols, known locally as ‘Kolyadki,’ in the village of Noviny, Belarus. Many Orthodox Belarussians mark the New Year, according to the Julian calendar, on Jan. 13. Vasily Fedosenko/Reuters

Covered with branches and cow bells, ‘Silvesterchlaeuse,’ New Years Clauses, perform in front of a farm house in Urnaesch, Switzerland, to offer their best wishes for the New Year (according to the Julian calendar.) After their performance, they receive food, hot drinks or money. Ennio Leanza/Keystone/AP

Market Closes for January 13^th, 2014

Market  Index	Close	Change
Dow  Jones	16257.94	-179.77    -1.09%
S&P 500	1819.20	-23.17    -1.26%
NASDAQ	4113.305	-61.360    -1.47%
TSX	13681.48	-66.04
		-0.48%

International Markets

Market  Index	Close	Change
NIKKEI	15912.06	+31.73
		+0.20%
HANG  SENG	22888.76	+42.51
		+0.19%
SENSEX	21134.21	+375.72
		+1.81%
FTSE 100	6757.15	+17.21
		+0.26%

Bonds

Bonds	% Yield	Previous % Yield
CND.  10 Year Bond	2.544	2.557
CND.   30 Year Bond	3.094	3.110
U.S.   10 Year Bond	2.8257	2.8561
U.S.   30 Year Bond	3.7726	3.7991

Currencies

BOC Close	Today	Previous
Canadian $	0.91875	0.91784
US   $	1.08843	1.08952
Euro Rate  1 Euro=		Inverse
Canadian   $	1.48737	0.67233
US  $	1.36652	0.73179

Commodities

Gold	Close	Previous
London Gold   Fix	1253.28	1246.33
Oil	Close	Previous
WTI Crude Future	91.80	92.72
BRENT	109.360	109.360

Market Commentary:

Canada

By Eric Lam

Jan. 13 (Bloomberg) — Canadian stocks fell the most in a month, ending a four-day streak of gains, as declining oil prices dragged down energy producers and Goldcorp Inc. dropped after making a bid for Osisko Mining Corp.

Goldcorp, the world’s second-largest producer of the metal, dropped 1 percent after offering to buy Osisko for about C$2.6 billion ($2.38 billion) in cash and shares. Osisko surged 21 percent. Savanna Energy Services Corp. lost 5.8 percent to lead declines among energy stocks. Fortuna Silver Mines Inc. added 11 percent after its silver production guidance was 30 percent higher than the previous year.

The Standard & Poor’s/TSX Composite Index fell 66.04 points, or 0.5 percent, to 13,681.48 at 4 p.m. in Toronto, the biggest decrease since Dec. 11. The gauge had rallied 1.9 percent in the previous four sessions.

“The oil stocks are looking weak today,” said David Cockfield, a fund manager with Northland Wealth Management in Toronto. The firm manages about C$250 million. “This is the way it’s going to be, not huge leaps forward. There’s some waiting for fourth-quarter earnings and a quiet edging upwards of the market to get us through 14,000.”

Energy stocks dropped 1.1 percent as a group, the most in a month, as eight of 10 industries in the S&P/TSX retreated.

Trading volume was 91 percent above the 30-day average.

Goldcorp slumped 1 percent to C$25.04 after it made an unsolicited offer to buy Osisko in a deal that would add 10 million ounces of gold reserves and make it the largest producer in Quebec. Osisko surged 21 percent to C$6.24.

As part of the proposed deal, Goldcorp would pay 0.146 Goldcorp shares plus C$2.26 cash for each Osisko share, valuing the company at C$5.95, a 15 percent premium based on Jan. 10 closing prices.

Lightstream Resources Ltd. fell 4.8 percent to C$5.81 and Savanna Energy Services dropped 5.8 percent to C$7.83, the biggest plunge in two years.

West Texas Intermediate crude declined as much as 1.2 percent. Iran agreed to curtail its nuclear program starting Jan. 20 under terms of a deal that will ease some sanctions on OPEC’s fifth-biggest oil producer, bringing additional supply to market.

Surge Energy Inc.lost 3.2 percent to C$6.34. The company agreed to acquire light oil producing assets in southeast Saskatchewan for C$109 million, paid for in part by issuing C$70 million worth of subscription receipts convertible to common stock.

BlackBerry Ltd. sank 4.7 percent to C$9.11 to snap five days of gains, the longest winning streak for the stock since August. BlackBerry had rallied 18 percent in that period.

John Chen, Chief Executive Officer at the Waterloo, Ontario-based smartphone maker, hired Eric Johnson for BlackBerry’s top sales job. Johnson was a colleague of Chen’s at SAP AG.

Finning International Inc., which sells, finances and services Caterpillar construction equipment, slumped 4.1 percent to C$26.22. Ben Cherniavsky, analyst with Raymond James Ltd., lowered his rating for the stock from “strong buy” to “outperform,” the equivalent of a buy. Cherniavsky lowered his rating as the stock has rallied more than the benchmark gauge since his last change.

Fortuna Silver Mines climbed 11 percent to C$3.64, the highest close since November, after reporting 2013 silver production of 4.6 million ounces from its two underground silver mines in Mexico and Peru and introduced 2014 guidance for 6 million ounces of silver, a 30 percent increase.

Centerra Gold Inc. added 4.5 percent to C$4.86 after reporting 2013 gold production of 690,720 ounces across its mines in the Kyrgyz Republic and in Mongolia.

“Both operations exceeded the company’s 2013 production guidance,” said Ian Atkinson, chief executive officer of Centerra, said in a release.

USA

By Callie Bost

Jan. 13 (Bloomberg) — U.S. stocks fell, sending the Standard & Poor’s 500 Index to its biggest loss in two months, amid concern over valuations after benchmark indexes rallied to all-time highs in 2013.

Companies from Microsoft Corp. to Nike Inc. and Walt Disney Co. dropped more than 2 percent, with all 10 main industries in the S&P 500 declining. Lululemon Athletica Inc. slumped 17 percent after the sportswear maker lowered its profit and sales forecast. Intercept Pharmaceuticals Inc. plunged 18 percent after the stock soared sixfold last week. Beam Inc. jumped 25 percent after Suntory Holdings Ltd. said it will acquire the spirits maker in a $16 billion deal.

The S&P 500 fell 1.3 percent to 1,819.20, the lowest level since Dec. 20, at 4 p.m. in New York. Some 464 companies in the S&P 500 declined today, the most since Aug. 27, data compiled by Bloomberg show. The Dow Jones Industrial Average lost 179.11 points, or 1.1 percent, to 16,257.94, for the biggest drop since September. About 7.2 billion shares changed hands on U.S. exchanges, the most since Dec. 20.

“Sentiment is extremely optimistic and that’s a negative for stocks,” Bruce Bittles, chief investment strategist at RW Baird & Co., said by phone from Sarasota, Florida. His firm oversees $105 billion. “That means for the short term they’re fully invested. Stocks have entered the new year overbought and over-believed and until we digest that, we’re likely to stay in this range.”

The S&P 500 has dropped 1.58 percent so far in 2014, the worst start to a year since 2009, according to data compiled by Bloomberg. The index ended last year at a record, having climbed 30 percent for its biggest annual rally since 1997.

Valuation for the S&P 500 is “lofty by almost any measure,” Goldman Sachs analysts wrote in a note Jan. 10. Further price-to-earnings expansion will be difficult to achieve, according to the note.

The benchmark index trades at 15.4 times the estimated earnings of its members, more than the average multiple of 14.1 over the last five years, data compiled by Bloomberg show. The gauge ended 2013 at its highest valuation since the end of 2009.

“The way to think about the market is the level of earnings and the multiple which should be applied to that earnings growth,” David Kostin, chief U.S. equity strategist at Goldman Sachs, said today on Bloomberg Television. “Those really are the fundamental drivers of the level of U.S. equity markets this year.”

JPMorgan Chase & Co., Bank of America Corp., Goldman Sachs, and Citigroup Inc. are among 29 members of the S&P 500 to report quarterly results this week. Earnings for companies in the index probably climbed 4.9 percent on average in the fourth quarter, while sales increased 1.8 percent, according to analyst estimates compiled by Bloomberg.

Stocks extended declines today after Federal Reserve Bank of Atlanta President Dennis Lockhart said the U.S. economy is on “solid footing” and he would support continued cuts to stimulus.

Three rounds of monetary stimulus from the Fed have helped push the S&P 500 higher by 169 percent from a 12-year low in 2009. The Fed, which next meets Jan. 28-29, last month announced a reduction in its monthly bond-buying program, citing a recovery in the labor market.

The S&P 500 increased on Jan. 10 after a report from the Labor Department showed employment rose in December at the slowest pace in almost three years. The data ended months of improving job growth that had signaled the world’s largest economy was picking up.

“It sounds as if the Fed is staying on its course of tapering,” John Carey, a fund manager at Boston-based Pioneer Investment Management Inc., said in a telephone interview. His firm manages about $220 billion worldwide. “Whatever mixed signals could have come from the jobs numbers, they’re looking at the overall picture.”

The Chicago Board Options Exchange Volatility Index, which measures expected swings on the S&P 500 using options prices, rose 9.4 percent, the most in a month, to 13.28. The gauge fell 12 percent last week to its lowest level since Aug. 5.

The Morgan Stanley Cyclical Index and the Dow Jones Transportation Average each fell 1.4 percent. Microsoft decreased 2.9 percent to $34.98, while Disney tumbled 2.8 percent to $73.27 for the largest declines in the Dow industrial average. Nike fell 2.3 percent to $75.18 and Exxon Mobil Corp. slid 2 percent to $98.55.

The KBW Bank Index slumped 1.3 percent as Bank of America dropped 2 percent, the most since October, to $16.43 and Citigroup slipped 1.8 percent to $53.72. Homebuilders in the S&P erased 2.5 percent as PulteGroup Inc. lost 3.8 percent to $19.40 and D.R. Horton Inc. decreased 2.7 percent to $21.55.

All 10 main industries in the S&P 500 retreated. Consumer- discretionary companies and energy producers fell more than 1.9 percent. Kohl’s Corp. plunged 6.2 percent to $53.46 and Michael Kors Holdings Ltd. slipped 3.9 percent to $76.67. Gap Inc. dropped 4 percent to $38.25.

Lululemon slumped 17 percent to $49.70, the lowest level in two years. The yogawear retailer cut its revenue and earnings forecast for its fourth quarter ending Feb. 2. Lululemon joins retailers from L Brands Inc. to Family Dollar Stores Inc. that have cut forecasts this month in the wake of a margin-eating price war this holiday season.

Vancouver-based Lululemon has been trying to win back customers after being forced to recall pants last year for being too sheer and has struggled to overcome supply-chain delays as it expands overseas and fends off growing competition.

Intercept plunged 18 percent to $364.36. Chief Executive Officer Mark Pruzanski said he may need the help of a larger drugmaker to bring the company’s experimental liver-disease treatment to market. The stock soared 545 percent last week after a trial of the drug worked well enough for the testing to be stopped.

Symantec Corp. fell 5.4 percent to $22.20 after Morgan Stanley lowered its rating on the stock to underweight from equal weight. The brokerage predicted that revenue would rebound more slowly as Symantec reorganizes its sales force, potentially limiting its profitability.

Beam jumped 25 percent to $83.42, an all-time high. Osaka- based Suntory, the maker of Yamazaki whiskey and the Premium Malt’s beer, is seeking to boost overseas growth by gaining brands such as Maker’s Mark whiskey, Jim Beam and Canadian Club liquor.

Suntory will pay $83.50 per share in cash and take over all of Beam’s outstanding debt, according to a joint statement. The companies said they expect to complete the deal by the end of June. The deal, once completed, will create the world’s third- largest premium spirits company.

Juniper Networks Inc. climbed 7.6 percent to $25.32, the highest level since July 2011. The maker of computer-networking equipment has been targeted by activist hedge fund Elliott Management Corp., run by billionaire Paul Singer, which will seek cost cuts, stock buybacks and other changes, two people familiar with the matter said.

Elliott is seeking talks with management and the company’s board, the people said.

Merck & Co. was the only company in the Dow to rise today, surging 6.5 percent to $53.12, the highest level in six years.

The second-largest U.S. pharmaceuticals said it will seek early approval of a new cancer treatment and decide the future of the company’s animal health and consumer businesses this year.

Twitter Inc. rose 1.4 percent to $57.82. Goldman Sachs analyst Heath Terry raised the stock’s price target to $65 a share from $46, citing Twitter’s “significant acceleration” in innovation during the fourth quarter.     Twitter has seen five trading sessions of declines, falling 17 percent last week as the microblogging service was hit with analyst downgrades and Cowen & Co. initiating coverage of the stock with the equivalent of a sell rating.

 

Have  a wonderful evening everyone.

 

Be magnificent!

 

Very few people in this world can reason normally.

There is a terrible tendency to accept all that is said, all that is read, and to accept it without question.

Only he who is ready to  question, to think for himself, will find the truth!

To understand the currents of a river,

he who wishes to know the truth must enter the water.

-Nisargadatta, 1897-1981

As ever,

 

Carolann

Don’t cry because it’s over.

Smile because it happened.

-Dr. Seuss, 1904-1991

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

Senior Vice-President &

Senior Investment Advisor

Queensbury Securities Inc.,

St. Andrew’s Square

Suite 340A, 730 View St.,

Victoria, B.C. V8W 3Y7

 

Dear Friends,

Tangents:

As Carolann is out of the office this afternoon, I will be writing the newsletter on her behalf.

Reader’s Digest just released the 2014 version of Manners and Etiquette: The Best Rules to Follow.  Below you will find the top 12 rules everyone should follow!

1)   Wait for everyone to be seated before eating

2)   Keep things off the table, including keys, bags, sunglasses, etc

3)   Don’t text at the table

4)   If you prefer not to have wine while dining out, don’t turn your glass upside down

5)   Practice good speakerphone manners

6)   Whoever arrives at a door first holds it for the next person

7)   Don’t microwave stinky foods in the shared lunchroom

8)   At the airport, don’t crowd the boarding area

9)   Let people off the elevator and hold the doors for others before you board

10)  If all you have to say in your e-mail reply is “Thanks!” refrain from sending it.

11)  Keep your cell phone out of the conversation

12)  Be polite in e-mail

“There is nothing like returning to a place that remains unchanged to find the ways in which you yourself have altered.”
Nelson Mandela

Photos of the Day:

A flower blooms in the ash from Mt Sinabung near Sibintun village in Karo district, Indonesia’s North Sumatra province. Beawiharta/Reuters

A man shields himself from the rain as he walks along Holman Street in Houston. Cody Duty/Houston Chronicle/AP

Market Closes for January 9^th, 2014

Market  Index	Close	Change
Dow  Jones	16445.91	-16.83    -0.10%
S&P 500	1838.14	+0.65    +0.04%
NASDAQ	4156.195	-9.416    -0.23%
TSX	13638.52	+23.89
		+0.18%

International Markets

Market  Index	Close	Change
NIKKEI	15880.33	-241.12
		-1.50%
HANG  SENG	22787.33	-209.26
		-0.91%
SENSEX	20713.37	-16.01
		-0.08%
FTSE 100	6691.34	-30.44
		-0.45%

Bonds

Bonds	% Yield	Previous % Yield
CND.  10 Year Bond	2.684	2.718
CND.   30 Year Bond	3.191	3.210
U.S.   10 Year Bond	2.9578	2.9894
U.S.   30 Year Bond	3.8678	3.8921

Currencies

BOC Close	Today	Previous
Canadian $	0.92211	0.92394
US   $	1.08448	1.08232
Euro Rate  1 Euro=		Inverse
Canadian   $	1.47577	0.67761
US  $	1.36082	0.73485

Commodities

Gold	Close	Previous
London Gold   Fix	1228.43	1225.15
Oil	Close	Previous
WTI Crude Future	91.66	92.33
BRENT	109.360	109.360

Market Commentary:

Canada

By Callie Bost

Jan. 9 (Bloomberg) — Canadian stocks rose for a third day, erasing a loss for the year, as gains in health-care and industrial shares offset declines in raw-material companies amid a slump in copper prices.

Air Canada soared 8.6 percent to lead industrial shares higher. Valeant Pharmaceuticals International Inc. added 3.5 percent. HudBay Minerals Inc. dropped 2.7 percent after announcing it would sell more than 18 million shares. First Quantum Minerals Ltd. lost 2.5 percent as copper prices slid 1.3 percent. Teck Resources Ltd. retreated 2.1 percent after Cowen & Co. analysts downgraded the stock.

The Standard & Poor’s/TSX Composite Index rose 14.78 points, or 0.1 percent, to 13,629.41 at 4 p.m. in Toronto. The gauge is up 0.1 percent for the year, erasing an earlier loss.

The Canadian dollar weakened to the lowest level since 2009 amid speculation slowing employment growth will push the Bank of Canada closer to considering lowering interest rates. The loonie, as the Canadian dollar is nicknamed for the waterfowl on its C$1 coin, fell 0.3 percent to C$1.0851 per U.S. dollar.

Copper fell the most in two months after a gauge of Chinese producer prices fell for a 22nd straight month, fanning concern about an economic slowdown in the biggest global user of the metal.

The producer-price index fell 1.4 percent from a year before and consumer-price gains trailed estimates at 2.5 percent, government reports showed in Beijing. Today’s releases followed declines in gauges of manufacturing and services based on surveys of purchasing managers.

Domestic building permits fell for the first time in three months. The value of municipal permits in Canada fell 6.7 percent to C$6.75 billion, Statistics Canada said today in Ottawa. Economists forecast a 2.7 percent reduction, according to the median of six responses to a Bloomberg survey.

Projects such as apartments and condominiums dropped 8.7 percent to C$1.88 billion in November, curbing the increase over the prior 12 months to 25 percent.

Five of the S&P TSX’s 10 main industries rose. Valeant Pharmaceuticals led health-care companies higher, jumping 3.5 percent to C$143.51.

Air Canada jumped 8.6 percent to C$7.95, reversing three days of losses. The carrier soared 323 percent last year, making it the best performer in the S&P/TSX.

Producers of raw materials and phone companies lost at least 0.6 percent for the largest declines.

First Quantum Minerals decreased 2.5 percent to C$18.31.

Copper futures for delivery in March lost 1.3 percent to $3.299 a pound, the biggest decline since Nov. 13.

HudBay Minerals plunged 2.7 percent to C$8.57. The mining company is planning to raise C$150 million in an offering of 18.2 million shares at C$8.25, implying a 6.4 percent discount to its closing price yesterday.

Teck Resources dropped 2.1 percent to C$25.72. Cowen analyst Daniel Scott downgraded the stock to market perform from outperform, citing concerns such as ample global supply and muted demand.

Advantage Oil & Gas Ltd. fell 5.1 percent to C$4.63 as natural gas futures declined 5 percent.

US

By Nick Taborek

Jan. 9 (Bloomberg) — U.S. stocks were little changed as retailers slumped and investors awaited tomorrow’s jobs report for clues to whether the Federal Reserve will accelerate the pace of stimulus cuts.

Bed Bath & Beyond Inc. sank 12 percent and L Brands Inc. slid 4.1 percent, leading losses among retailers, as earnings forecasts disappointed analysts. Macy’s Inc. and J.C. Penney Co. rallied more than 3.6 percent. Intercept Pharmaceuticals Inc. soared 281 percent after a trial of its liver disease drug worked well enough for the testing to be stopped. Alcoa Inc., the largest U.S. aluminum maker, slid 4.2 percent in extended trading after its quarterly results missed analysts’ estimates.

The S&P 500 rose less than 1 point to 1,838.13 at 4 p.m. in New York. The Dow Jones Industrial Average dropped 17.98 points, or 0.1 percent, to 16,444.76. About 6.7 billion shares changed hands on U.S. exchanges, 11 percent above the 30-day average.

“You could be seeing some anticipation that the jobs number tomorrow could be really high,” Walter Todd, who oversees about $950 million as chief investment officer of Greenwood Capital Associates LLC in Greenwood, South Carolina, said by phone. “That could change the timetable for the Fed’s ultimate exit from quantitative easing.”

The S&P 500 has fallen 0.6 percent in 2014, after climbing 30 percent last year, the most since 1997. Three rounds of Federal Reserve stimulus have helped propel the S&P 500 higher by as much as 173 percent from a 12-year low in 2009.

Equities slipped yesterday as minutes from the Fed’s latest meeting fueled concern that stimulus cuts may be accelerated.

Officials saw diminishing economic benefits from the central bank’s bond-buying program, according to the minutes, which didn’t describe a set schedule for the pace of reductions, although “a few” officials mentioned the need for a “more deterministic path.”

The Fed announced after the December meeting that it would begin trimming monthly bond buying by $10 billion to $75 billion this month as the U.S. economy continues to improve.

Data today showed applications for U.S. unemployment benefits declined by 15,000 to 330,000 in the period ended Jan. 4. The median forecast of 47 economists surveyed by Bloomberg projected 335,000. The data can be volatile after the holidays as temporary workers are dismissed, a Labor Department spokesman said as the report was released.

A report from the ADP Research Institute yesterday showed companies added 238,000 workers in December, the biggest increase since November 2012. A Labor Department report tomorrow may show total payrolls rose by 197,000 last month, according to a Bloomberg survey median. That would bring the total for the year to 2.27 million, the most since 2005.

Alcoa, the largest U.S. aluminum maker, marked the unofficial start of earnings season after the close of trading today by reporting fourth-quarter profit that missed analysts’ estimates amid a glut of product for the aerospace industry. The shares slid 4.2 percent to $10.24 in extended trading, after losing 1.3 percent in the regular session.

The company also agreed to pay $384 million to settle U.S. allegations that one of its units bribed members of Bahrain’s royal family and officials at a state-owned company to win business.

Analysts predict that companies in the S&P 500 will increase their earnings by 9.7 percent on average this year and their sales by 3.8 percent, according to estimates compiled by Bloomberg.

JPMorgan Chase & Co., Bank of America Corp. and Goldman Sachs Group Inc. will all post their results next week.

“We are at a tipping point — if not a turning point — where markets will start to be driven by earnings per share and not price-to-earnings ratios,” said Romain Boscher at Amundi Asset Management in Paris, which oversees about $1 trillion.

Five out of 10 main industries in the S&P 500 slumped, with phone companies falling 1.9 percent for the biggest decline.

AT&T Inc. fell 2 percent to $33.54 and Verizon Communications Inc. slid 2.1 percent to $47.50 for the steepest losses in the Dow.

Retailers retreated 0.2 percent as a group. Companies from L Brands, which owns the Victoria’s Secret and Bath & Body Works brands, to discount chain Family Dollar cut profit forecasts, showing the price war that marked the holiday season is taking a toll.

Family Dollar slid 2.1 percent to $64.97 and L Brands lost 4.1 percent to $57.75. The companies cut profit forecasts after reporting disappointing December sales as promotions that failed to lure shoppers hurt margins.

Bed Bath & Beyond slumped 12 percent to $69.75. The retailer projected fourth-quarter earnings of $1.60 to $1.67 a share, less than the $1.79 that analysts had estimated. Home- goods merchant Pier 1 Imports Inc. tumbled 12 percent to $20.44 as it also lowered its quarterly forecast.

Intercept Pharmaceuticals surged 281 percent to $275.87.

The company uses obeticholic acid, or OCA, to treat nonalcoholic steatohepatitis, or NASH, a liver disease in which people who don’t drink or drink very little alcohol get liver damage that resembles that of heavy drinkers. About 2 percent to 5 percent of Americans have the disease, according to the National Institutes of Health.

Copper fell the most in eight weeks, with futures for March delivery sliding 1.4 percent to $3.2975 a pound in New York as data showed China’s inflation eased in December while factory- gate prices extended the longest streak of declines since the Asian financial crisis.

Cliffs Natural Resources Inc. fell 6.5 percent to $22.96 and U.S. Steel Corp. lost 4.4 percent to $28.30.

Twitter Inc. dropped 3.8 percent to $57.05, extending its losses to a fourth straight day. The owner of the microblogging website has lost 17 percent since Jan. 3.

Macy’s jumped 7.6 percent, the most in the S&P 500, to $55.80. The second-largest U.S. department-store company forecast profit for its next fiscal year ahead of analysts’ estimates and disclosed a program to cut costs that includes eliminating about 2,500 jobs.

J.C. Penney climbed 3.7 percent to $7.64 after Piper Jaffray Cos. recommended buying the shares. J.C. Penney sank 10 percent yesterday after it published a two-paragraph statement on holiday results that didn’t include sales data, raising doubts about its turnaround. The brokerage said investors had overreacted and upgraded the retailer to overweight from neutral, citing the company’s decision to reiterate its guidance.

McKesson Corp. advanced 3.3 percent to $175.33 after raising its bid for German drug distributor Celesio AG, winning support from U.S. hedge fund Elliott Management Corp., which opposed the original offer as too low. The sweetened bid ends a stalemate that threatened to derail McKesson’s plan to expand in Europe. The acquisition may allow the U.S. company to buy as much as $10 billion a year in generic drugs for distribution, compared with $6 billion to $7 billion on its own.

Ford Motor Co. climbed 1.9 percent to $15.84. The auto company boosted its quarterly dividend for common shares and the stock held by its founding family to 12.5 cents, up from 10 cents and topping the 12-cent estimate by Bloomberg analysts.

Confidence in the U.S. economy is sending bets on stock correlation to the lowest levels since before the 2008 financial crisis, signaling an improved environment for stock pickers as the earnings season starts.

The Chicago Board Options Exchange S&P 500 Implied Correlation Index has fallen 16 percent from its November high to 50.22, according to data compiled by Bloomberg. The gauge, which uses options to measure expectations about whether S&P 500 shares will move in lockstep, reached 49.24 on Dec. 27, its lowest level since September 2008.

“It’s good news,” said Romain Boscher, head of equities at at Amundi Asset Management in Paris, which oversees about $1 trillion. “There is room for stock pickers and country pickers to create value. We are back to much more normal levels of market risk. It’s a much more comfortable market.”

 

Have a wonderful evening everyone.

 

Be magnificent!

 

“Lots of people want to ride with you in the limo, but what you want is someone who will take the bus with you when the limo breaks down.”
Oprah Winfrey

 

As ever,

 

Amanda Bourke

Assistant to Carolann Steinhoff

Queensbury Securities Inc.

 

St. Andrew’s Square

Suite 340A, 730 View St.,

Victoria, B.C. V8X 3Y7

 

Dear Friends,

Tangents:

It is truly amazing to contemplate how much scientific progress has been made in such a short period of time.  I was reading a story this morning about images released yesterday by NASA from the Hubble Space Telescope that reveal a “cosmic dawn.”  The telescope has peered back to a chaotic time 13.2 billion years ago when never-before-seen galaxies were tiny, bright blue and full of stars bursting to life all over the place; we’re starting to see the universe at its infancy in living colour and detail.  Astronomer Jennifer Lotz said at the American Astronomical Society convention in Washington, “I like to call it cosmic dawn; it’s when the lights are coming on….Things look clumpy and kind of weird.”  Because light travels nearly 9.6 trillion kilometers in a year, as telescopes look farther from Earth they see earlier into the past.  While Hubble and other telescopes using different light wavelengths have seen this far back, this is the first complete set of photos in the visible light spectrum that the human eye sees.  To do this, Hubble is using one of Albert Einstein’s concepts that massive clusters of galaxies have such super gravity that they magnify and stretch light, Lotz said.  By focusing on clusters, astronomers use them as natural binoculars to see what’s behind the.  –from an article by Seth Borenstein, The Associated Press.

So, contrast that story with the fact that on this day, January 8^th, in 1851, the Earth’s rotation was proved.

Today is also famous physicist Stephen Hawking’s birthday.  He turns 72 today.

My goal is simple. It is a complete understanding of the universe, why it is as it is and why it exists at all. – Stephen Hawking

On a related topic, also in the news today:

LEONARDO DICAPRIO’S CARBON FOOTPRINTS
The actor/environmentalist is planning a space voyage on Richard Branson’s Virgin Galactic. But FAA data show the trip will burn more than five times Mr. Branson’s estimated amount of fuel, amounting to twice the average American’s annual energy consumption. –Wall Street Journal, 1/8/2014.

We are just an advanced breed of monkeys on a minor planet of a very average star.  But we can understand the Universe.  That makes us something very special. –Stephen Hawking.

Photos of the day

Show attendee Limore Shur waits inside a Nikon-powered XXArray during the 2014 International Consumer Electronics Show (CES) in Las Vegas. The booth uses 68 cameras that fire at the same time. The images are processed to create a 3D model of the subject that can be placed inside a computer video game. Steve Marcus/Reuters

Participants arrange sushi to create the largest sushi mosaic in an attempt to break a Guinness World Record during the 10th anniversary of a sushi chain store in Hong Kong. A total of 20,647 sushi pieces were used for a 37-square-meter space to break the record. Bobby Yip/Reuters

Market Closes for January 8^th, 2014

Market  Index	Close	Change
Dow  Jones	16462.74	-68.20    -0.41%
S&P 500	1837.49	-0.39    -0.02%
NASDAQ	4165.613	+12.432    +0.30%
TSX	13614.63	+17.70
		+0.13%

International Markets

Market  Index	Close	Change
NIKKEI	16121.45	+307.08
		+1.94%
HANG  SENG	22996.59	+283.81
		+1.25%
SENSEX	20729.38	+36.14
		+0.17%
FTSE 100	6721.78	-33.67
		-0.50%

Bonds

Bonds	% Yield	Previous % Yield
CND.  10 Year Bond	2.718	2.681
CND.   30 Year Bond	3.210	3.168
U.S.   10 Year Bond	2.9894	2.9391
U.S.   30 Year Bond	3.8921	3.8849

Currencies

BOC Close	Today	Previous
Canadian $	0.92394	0.92881
US   $	1.08232	1.07664
Euro Rate  1 Euro=		Inverse
Canadian   $	1.46947	0.68052
US  $	1.35775	0.73651

Commodities

Gold	Close	Previous
London Gold   Fix	1225.15	1232.20
Oil	Close	Previous
WTI Crude Future	92.33	93.67
BRENT	109.360	109.360

Market Commentary:

Canada

By Lu Wang and Callie Bost

Jan. 8 (Bloomberg) — Canadian stocks rose a second day, following the biggest rally in three weeks, as a private report showed U.S. companies hired more workers than forecast.

Valeant Pharmaceuticals International Inc. advanced 2.6 percent after Morgan Stanley boosted the stock’s rating. Potash Corp. of Saskatchewan Inc. and Agrium Inc. climbed at least 2.2 percent, pacing gains among fertilizer stocks, as Monsanto Co.’s profit beat analysts’ estimates. Canadian National Railway Co. slipped 1.6 percent as a train carrying crude oil and propane derailed in the eastern province of New Brunswick.

The Standard & Poor’s/TSX Composite Index added 17.70 points, or 0.1 percent, to 13,614.63 at 4 p.m. in Toronto. The gauge rallied 0.8 percent yesterday. Trading was 18 percent above the 30-day average.

“Because we didn’t have a consumer debt crash or real- estate crash here, there is no dramatic recovery here either,”  Bill Harris, partner and portfolio manager with Avenue Investment Management in Toronto, said in a phone interview. His firm manages about C$250 million ($231 million). The question is, “The U.S. is recovering, but is Canada participating in it?” he said.

Companies in the U.S. boosted payrolls by 238,000 in December, compared with a 200,000 advance predicted in a Bloomberg survey, ADP Research Institute data showed. Federal Reserve officials saw diminishing economic benefits from the central bank’s bond-buying program and expressed concern about risks to financial stability when they took the first step to cut the pace of purchases, according to minutes of their last meeting released today.

Statistics Canada and the U.S. Labor Department will provide unemployment rates and new hiring figures for last month on Jan. 10.

Canadian stocks rose yesterday for the first time in four days, as the price of crude halted the longest slide since September. Oil retreated to the lowest level in six weeks today in New York.

Six out of 10 industries in the S&P/TSX advanced today as health-care companies rallied 2.4 percent to lead the gains.

Industrial stocks fell 0.8, the most of any group.

Valeant climbed 2.6 percent to an all-time high of C$138.54. The drug distributor was raised to overweight, an equivalent of buy, from equal-weight by Morgan Stanley.

Potash Corp., the world’s largest fertilizer company by market value, jumped 2.9 percent to C$36.19. Agrium gained 2.2 percent to C$97.90. Monsanto, the world’s largest seed company, reported fiscal first-quarter earnings that topped analysts’ estimates on rising sales of engineered soybean seeds and Roundup herbicide.

Questerre Energy Corp. climbed 6 percent to C$1.41. The independent energy company said Kim Anderson will become chief financial officer, replacing Brent Heagy, who plans to leave the company to join Inter Pipeline Ltd.

Canadian National Railway slipped 1.6 percent to C$58.63.

The 122-car train jumped the tracks about 7 p.m. local time yesterday near the town of Plaster Rock, sparking a blaze that was still burning more than 12 hours after the accident. A helicopter is being brought in today to help identify the source of fire, said Jim Feeny, a railroad spokesman.

The accident and a Dec. 30 crude-train derailment in North Dakota added to the attention on the risks of moving oil by rail.

Colabor Group Inc. dropped 5.6 percent to C$5.19. The wholesaler was cut to sector perform from outperform by Leon Aghazarian, an analyst with National Bank Financial.

USA

By Nick Taborek and Callie Bost

Jan. 8 (Bloomberg) — U.S. stocks fell, after yesterday’s rebound in benchmark indexes, as Federal Reserve minutes and better-than-estimated payrolls data fueled concern stimulus cuts may be accelerated.

Twitter Inc. dropped 3.5 percent, falling for a third day, amid an analyst downgrade. Ford Motor Co. gained 1 percent after Chief Executive Officer Alan Mulally ruled himself out from a race for the top job at Microsoft Corp. Micron Technology Inc. jumped 9.9 percent after reporting quarterly revenue that topped estimates. Forest Laboratories Inc. climbed 18 percent as it agreed to buy Aptalis Pharma for $2.9 billion.

The Standard & Poor’s 500 Index lost less than 0.1 percent to 1,837.49 at 4 p.m. in New York. The equities benchmark rose 0.6 percent yesterday after a three-day retreat. It climbed 30 percent last year, the most since 1997. The Dow Jones Industrial Average slipped 68.20 points, or 0.4 percent, to 16,462.74 today. Almost 7 billion shares changed hands on U.S. exchanges, 15 percent above the three-month average.

“I suspect from the minutes that there might be a bias toward pulling back stimulus sooner rather than later,” Brad McMillan, chief investment officer for Waltham, Massachusetts- based Commonwealth Financial Network, said in a phone interview.

“There seems to be a fairly wide consensus that stimulus should be gradually taken out.”

Fed officials saw diminishing economic benefits from the central bank’s bond buying program, according to the minutes of the meeting, when they took the first step to cut the pace of purchases. The minutes didn’t describe a set schedule for the pace of asset-purchase reductions, although “a few” officials mentioned the need for a “more deterministic path.”

“A majority of participants judged that the marginal efficacy of purchases was likely declining as purchases continue,” the record of the Federal Open Market Committee’s Dec. 17-18 meeting showed. Participants also were “concerned about the marginal cost of additional asset purchases arising from risks to financial stability” citing the potential for “excessive risk-taking in the financial sector.”

The central bank is trimming monthly bond buying by $10 billion to $75 billion this month. Three rounds of stimulus have helped propel the S&P 500 higher by as much as 173 percent from a 12-year low in 2009.

Companies in the U.S. boosted payrolls by 238,000 in December, figures from ADP Research Institute in Roseland, New Jersey, showed today. The median forecast of 36 economists surveyed by Bloomberg called for a 200,000 advance.

The Labor Department will announce on Dec. 10 figures for new hiring and the unemployment rate last month.

“We’re looking at a situation where equities are still likely to outperform most other markets,” Cam Albright, director of asset allocation at Wilmington Trust Investment Advisors, said in a phone interview from Wilmington. His firm oversees about $79 billion. “The question is whether if we see a jump in growth in jobs, is that going to accelerate the tapering process?”

The Chicago Board Options Exchange Volatility Index, the gauge of S&P 500 options known as the VIX, slid 0.4 percent to 12.87.

Global equity values are close to reaching a record for the first time since 2007. The total market capitalization of stocks around the world has risen to $61.5 trillion, near the all-time high of $62.6 trillion from October 2007, according to data compiled by Bloomberg.

The International Monetary Fund plans to raise its forecast for global economic growth this year, three months after lowering its prediction, underscoring confidence in the global recovery as the outlook for the U.S. improves. IMF Managing Director Christine Lagarde said yesterday that the revision will take place in three weeks. The multilateral institution now forecasts global expansion of 3.6 percent this year.

HSBC Holdings Plc cut U.S. stocks to underweight from neutral, citing high valuations compared with the rest of the world, earnings near record highs and the possible removal of monetary stimulus at a faster rate than in other developed markets. Companies in the S&P 500 are trading at 17.3 percent reported earnings, up from 14.5 at the start of 2013.

Alcoa Inc. will kick off the start of earnings season with the release of its results after the market close on Jan. 9.

Earnings for companies in the S&P 500 will climb 9.7 percent on average this year, almost twice the rate of 2013. Sales will probably increase 3.8 percent, compared with 2.2 percent last year, according to analyst estimates compiled by Bloomberg.

Twitter dropped 3.5 percent to $59.29, increasing its slide for the week to 14 percent. An analyst at Cantor Fitzgerald LP downgraded the shares to sell from hold and said the company’s valuation is excessive. Twitter shares debuted in November and rallied 145 percent through the end of 2013.

J.C. Penney Co. lost 10 percent to $7.37, bringing its five-day slump to 19 percent. The retailer reiterated its fourth-quarter forecast and said it was “pleased” with the holiday performance as the retailer works to rebound from two years of losses. The shares fell as the company didn’t provide December sales after releasing figures the previous three months.

Tenet Healthcare Corp. slid 1.6 percent to $45.36 after Raymond James Financial Inc. cut the shares to market perform, a rating similar to hold, from outperform.

Ford added 1 percent to $15.54. Mulally said he has no other plans except to serve the automaker. He made the comments in an Associated Press interview to end speculation that he may leave for Microsoft. Microsoft slipped 1.8 percent to $35.76.

Micron Technology jumped 9.9 percent to $23.87. The largest U.S. maker of memory chips reported quarterly revenue that topped analysts’ estimates. Revenue in the period through Nov. 28 more than doubled to $4.04 billion, the company said.

Analysts on average estimated sales of $3.72 billion, according to a Bloomberg survey.

Forest Laboratories climbed 18 percent to $69.30 after it agreed to buy Aptalis, a closely held company whose shareholders include investment firm TPG Capital, to expand in gastrointestinal and cystic fibrosis treatments.

Constellation Brands Inc. gained 9.6 percent to $76.61. The alcoholic beverage company reported third-quarter profit that beat analysts’ estimates and raised its profit forecast on a stronger outlook for its beer business.

Macy’s Inc. rallied 4.8 percent to $54.32 in extended trading as of 4:50 p.m. New York time. The department-store chain issued a profit forecast after the market close that exceeded analysts’ estimates and said it would cut 2,500 jobs to reduce costs.

 

Have a wonderful evening everyone.

 

Be magnificent!

 

With the clouds hanging in the air above the trees,

and the birds falling silent before the storm,

this morning brings forth serious reflection,

bringing into question the entirety of existence,

the gods themselves, and all human activity.

Krishnamurti, 1895-1986

As ever,

 

Carolann

 

In the right light, at the right time,

everything is extraordinary.

-Aaron Rose, 1969-

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

Senior Vice-President &

Senior Investment Advisor

Queensbury Securities Inc.,

St. Andrew’s Square

Suite 340A, 730 View St.,

Victoria, B.C. V8W 3Y7

 

Dear Friends,

Tangents:

The Chinese New Year, Nóngli Xinnián, begins on January 31^st this year, the first day of the first month of the Chinese calendar for 2014.  The Chinese months are determined by both solar and lunar changes, with the new year coming in approximately one and a half months after the winter solstice and symbolizing the beginning of spring.  For this reason, the fifteen days of celebration that begin on January 31^st are also known as the spring festival.  The Chinese year consists of 354 days compared to our 365 day year.

The animal designations of the Chinese zodiac follow a 12-year cycle and are always used in the same sequence.  This year will be the year of the horse.  Persons born in the year of the horse are physically attractive and popular; like the company of others and are thought to be most compatible with persons born in tiger or dog years.  Their opposite is the rat.

Horse Years: 1906, 1918, 1930, 1942, 1954, 1966, 1978, 1990, 2002, 2014.

Photos of the day

A worker walks among newly-made red lanterns as she and other workers prepare for the sales boom ahead of the Spring Festival at a family workshop in Wenxian county, Henan province, China. China Daily/Reuters

A miniature sculpture made by Chinese artist Li Qici is displayed on his finger in Yuyao, Zhejiang province, China. Li worked several months to craft the miniature sculpture on an ivory plate. The sculpture imitates Chinese painter Xu Beihong’s painting of eight running horses and celebrates Chinese New Year, which welcomes the year of the horse. Reuters

Market Closes for January 7^th, 2014

Market  Index	Close	Change
Dow  Jones	16530.94	+105.84    +105.84%
S&P 500	1837.88	+11.11    0.61%
NASDAQ	4153.184	+39.503    +0.96%
TSX	13596.93	+101.39
		+0.75%

International Markets

Market  Index	Close	Change
NIKKEI	15814.37	-94.51
		-0.59%
HANG  SENG	22712.78	+28.63
		+0.13%
SENSEX	20693.24	-94.06
		-0.45%
FTSE 100	6755.45	+24.72
		+0.37%

Bonds

Bonds	% Yield	Previous % Yield
CND.  10 Year Bond	2.681	2.719
CND.   30 Year Bond	3.168	3.194
U.S.   10 Year Bond	2.9391	2.9595
U.S.   30 Year Bond	3.8849	3.9012

Currencies

BOC Close	Today	Previous
Canadian $	0.92881	0.93803
US   $	1.07664	1.06607
Euro Rate  1 Euro=		Inverse
Canadian   $	1.46588	0.68218
US  $	1.36153	0.73447

Commodities

Gold	Close	Previous
London Gold   Fix	1232.20	1238.82
Oil	Close	Previous
WTI Crude Future	93.67	93.43
BRENT	109.360	109.360

Market Commentary:

Canada

By Eric Lam

Jan. 7 (Bloomberg) — Canadian stocks rose for the first time this year, after tumbling to a two-week low, as the price of crude halted the longest slide since September and Valeant Pharmaceuticals International Inc. surged to a record.

Athabasca Oil Corp. and Encana Corp. rose at least 0.6 percent to pace advances among energy stocks. Valeant jumped 13 percent after providing a 2014 forecast. BlackBerry Ltd. increased 7.4 percent for a second day of gains. Semafo Inc. and Detour Gold Corp. lost more than 0.7 percent as gold slipped a second day.

The Standard & Poor’s/TSX Composite Index rose 101.39 points, or 0.8 percent, to 13,596.93 at 4 p.m. in Toronto. The benchmark equity gauge lost 0.9 percent over the previous three sessions.

“Today is a continuation of the run we had in December,” said Ian Nakamoto, director of research with MacDougall MacDougall & MacTier Inc. in Toronto. The firm manages about C$4.7 billion ($4.37 billion). “The past couple of days were an aberration during the holidays. People are coming back to work and there’s an air of optimism as the big jobs number comes on Friday.”

Statistics Canada and the U.S. Labor Department will provide unemployment rates and new hiring figures for last month on Jan. 10.

Brent crude halted its longest run of declines since September on concern clashes between Iraq’s government and al- Qaeda-linked militants may disrupt oil output. Brent for February settlement rose 0.6 percent in London. West Texas Intermediate crude increased 0.3 percent in New York.

The S&P/TSX Energy Index rallied 1 percent as 50 of 63 stocks advanced. Athabasca Oil climbed 3.7 percent to C$6.98, for the highest close in two months, and Encana added 0.6 percent to C$18.79.

Bellatrix Exploration Ltd. advanced 5.1 percent to C$8.08 after reporting record production levels at the end of 2013 of 38,000 barrels of oil equivalent per day.

Valeant jumped 13 percent to C$135.03 as health-care stocks soared 10 percent as a group, the most in the S&P/TSX. Nine of 10 industries advanced on trading volume 7.5 percent higher compared with the 30-day average.

Valeant said in a conference call that all of its business units are expected to expand in 2014, including double-digit growth across its Asia, Central and Eastern Europe, Latin America and Middle East markets. The company will pursue further acquisitions, including at least “one significant deal.”

BlackBerry surged 7.4 percent to C$9.14, the highest level since September. Chief Executive Officer John Chen said the smartphone maker will return its focus to keyboard-equipped phones after struggling to entice customers with touch-screen models last year.

“I personally love the keyboards,” Chen said in an interview yesterday with Bloomberg Television’s Jon Erlichman at the International Consumer Electronics Show in Las Vegas.

The stock has rallied 13 percent in the past two days.  BlackBerry yesterday hired former HTC Corp. and Sony Ericsson executive Ron Louks to run its devices business.

Semafo dropped 0.7 percent to C$3.04 and Detour Gold retreated 2.5 percent to C$5.04, ending a four-day advance, as gold futures for February delivery fell 0.7 percent to $1,229.60 an ounce in New York.

USA

By Nick Taborek and Sofia Horta e Costa

Jan. 7 (Bloomberg) — U.S. stocks rose, snapping a three- day retreat, as hospital and health-insurance stocks rallied ahead of Friday’s employment report and the start of fourth- quarter earnings season this week.

UnitedHealth Group Inc. and Johnson & Johnson rose more than 2.1 percent, leading gains in the Dow Jones Industrial Average, after brokerages raised their stock ratings.

Pharmacyclics Inc. jumped 20 percent after its leukemia medicine met a trial’s goals. Netflix Inc. slid 5.6 percent as Morgan Stanley said the company faces more competition.

The Standard & Poor’s 500 Index advanced 0.6 percent to 1,837.88 at 4 p.m. in New York. The gauge lost 1.2 percent from Jan. 2 through yesterday, the longest stretch of declines to start a year since 2005. The index climbed 30 percent last year, the most since 1997. The Dow average added 105.84 points today, or 0.6 percent, to 16,530.94.

“Equities are the place to be,” John Lynch, the Charlotte-based regional chief investment officer for Wells Fargo Private Bank, said by telephone. His firm manages $170 billion.    Everyone’s waiting on the Fed minutes tomorrow and the jobs report on Friday could be a driver of further confidence.”

Alcoa Inc. will mark the unofficial start of the fourth quarter earnings season when it reports results after the market close on Jan. 9. Earnings for companies in the S&P 500 will climb 9.7 percent on average this year, almost twice the rate of 2013, while sales will probably increase 3.8 percent, according to analyst estimates compiled by Bloomberg.

The ADP Research Institute reports the change in companies’ payrolls tomorrow and minutes from the Federal Reserve’s December meeting will be released the same day. The Labor Department will provide the unemployment rate and new hiring figures for last month on Friday. The Fed, which has made job creation a condition for reducing asset purchases, said on Dec. 18 that it would slow the pace of bond buying.

Three rounds of stimulus have helped propel the S&P 500 higher by as much as 173 percent from a 12-year low in 2009.

Janet Yellen won Senate confirmation with a 56-26 vote to become the 15th chairman of the Fed. She will replace Ben S. Bernanke, whose second term as chairman expires Jan. 31.

Data today showed the trade deficit in the U.S. shrank more than forecast in November as oil imports dropped to the lowest level in three years and exports climbed to a record. The gap narrowed 12.9 percent to $34.3 billion, smaller than projected by any economist surveyed by Bloomberg and the least since October 2009, figures from the Commerce Department showed today in Washington.

“Sentiment is still very high,” said Francois Savary, who oversees about $9.4 billion as chief investment officer at Reyl & Cie. in Geneva. “The key question now will be to see if earnings growth really does come through. When you have less liquidity in the system and good economic numbers to support the recovery, it’s time for companies to deliver.”

The Chicago Board Options Exchange Volatility Index, the gauge of S&P 500 options known as the VIX, fell 4.7 percent to 12.92.

Nine out of 10 main industries in the S&P 500 rose as health-care stocks added 1 percent to pace gains. Almost four stocks rose for each that declined in the U.S. equity benchmark.

About 6.7 billion shares changed hands on U.S. exchanges, 11 percent above the three-month average.

UnitedHealth climbed 3.1 percent to $76.51. The largest publicly traded U.S. insurer was raised to buy from hold by analysts at Deutsche Bank AG. J&J, the world’s biggest maker of health-care products, increased 2.1 percent to $94.29 as RBC Capital Markets boosted the stock to outperform from sector perform.

Tenet Healthcare Corp. rallied 4.9 percent to $46.10 and HCA Holdings Inc. advanced 2.7 percent to $49.85. Credit Suisse, which rates both companies outperform, advised buying hospital stocks on any weakness.

Pharmacyclics, the cancer-drug developer partnered with J&J, rallied 20 percent to $125.90. Its leukemia drug Imbruvica helped patients live longer without their cancer progressing compared with GlaxoSmithKline Plc’s Arzerra, also known as ofatumumab, Pharmacyclics and J&J said in statements today.

Imbruvica also showed improvement in overall survival and had an acceptable safety profile, the companies said.

The Nasdaq Biotechnology Index added 1.4 percent, the biggest advance in two weeks. Health-care shares in the S&P 500 have risen 0.3 percent in 2014, the most among the 10 main industries.

Convergys Corp. jumped 7.3 percent to $22.39. The information management firm said it will buy Stream Global Services Inc. for $820 million, adding 35 cents to its adjusted earnings-per-share in the first 12 months after the deal’s projected completion in the first quarter of this year.

MGM Resorts International, Wynn Resorts Ltd. and Las Vegas Sands Corp. advanced after Nomura analyst Harry Curtis increased his estimates for the companies’ Macau earnings and raised his price targets for all three stocks.

MGM rose 4.4 percent to $24.51 and Wynn Resorts gained 2.9 percent to $201.51. Las Vegas Sands added 2.2 percent to $78.98.

Netflix dropped 5.6 percent to $339.50. Morgan Stanley cut its rating on the stock to underweight, similar to a sell recommendation, from equal weight, citing increased competition in U.S. digital-video streaming. The stock almost quadrupled last year.

PBF Energy Inc. declined 4.7 percent to $28.50. The oil refiner said funds affiliated with First Reserve Management LP and Blackstone Group LP will sell 15 million shares in PBF, according to a statement.

Accelerating earnings growth will pave the way for stocks to extend their bull market this year, according to Thomas J.

Lee, JPMorgan Chase & Co.’s chief U.S. equity strategist. After climbing 6 percent this quarter, S&P 500 profit will rise 10 percent in the second quarter, 11 percent in the third and 14 percent in the fourth, according to the New York-based strategist’s estimates.

 

Have a wonderful evening everyone.

 

Be magnificent!

 

The outward freedom that we shall attain will only be in exact proportion

to the inward freedom to which we may have grown at any given moment.

Mahatma Gandhi, 1869-1948

As ever,

 

Carolann

 

Life is a long lesson in humility.

-James M. Barrie, 1860-1937.

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

Senior Vice-President &

Senior Investment Advisor

Queensbury Securities Inc.,

St. Andrew’s Square

Suite 340A, 730 View St.,

Victoria, B.C. V8W 3Y7

 

Dear Friends,

Tangents:

On this day in 1540, Henry VIII of England married his fourth wife, Anne of Cleves. Anne was relatively luckier than most of Henry’s wives. The marriage was never consummated and quickly annulled, she got a large settlement from the king, and she outlived each of his other five wives (which isn’t saying much, as a few of them had fairly brief life spans). –Steven Russolillo, WSJ, 01/06/14.

I finished reading a terrific novel over the holidays which I highly recommend.  It is entitled The Gift of Rain by Tan Twan Eng; nominated for the Man Booker Prize in 2007, when it was first published.

Sticks and stones may break our bones but words will break our hearts. –Robert Fulghum, 1937-

Photos of the day

People watch and photograph enormous waves as they break on Porthcawl harbor in South Wales, United Kingdom. Residents along Britain’s coasts are braced for more flooding as strong winds, rain and high tides lash the country. Ben Birchall/PA/AP

Members of the Edo Firemanship Preservation Association display their balancing skills atop bamboo ladders during a New Year demonstration by the fire brigade in Tokyo. Yuya Shino/Reuters

Market Closes for January 6^th, 2014

Market  Index	Close	Change
Dow  Jones	1642.10	-44.89    -0.27%
S&P 500	1826.77	-4.60    -0.25%
NASDAQ	4113.680	-18.227    -0.44%
TSX	13495.54	-53.32
		-0.39%

International Markets

Market  Index	Close	Change
NIKKEI	15908.88	-382.43
		-2.35%
HANG  SENG	22684.15	-133.13
		-0.58%
SENSEX	20787.30	-64.03
		-0.31%
FTSE 100	6730.73	+0.06
		—

Bonds

Bonds	% Yield	Previous % Yield
CND.  10 Year Bond	2.719	2.753
CND.   30 Year Bond	3.194	3.216
U.S.   10 Year Bond	2.9595	2.9911
U.S.   30 Year Bond	3.9012	3.9212

Currencies

BOC Close	Today	Previous
Canadian $	0.93803	0.93996
US   $	1.06607	1.06387
Euro Rate  1 Euro=		Inverse
Canadian   $	1.45324	0.68812
US  $	1.36318	0.73358

Commodities

Gold	Close	Previous
London Gold   Fix	1238.82	1237.02
Oil	Close	Previous
WTI Crude Future	93.43	93.96
BRENT	109.360	109.360

Market Commentary:

Canada

By Eric Lam

Jan. 6 (Bloomberg) — Canadian stocks fell for a third day, leaving the benchmark gauge at a two-week low, as declines among energy producers and banks overshadowed gains in precious metals producers.

Telus Corp. and BCE Inc. slid at least 0.6 percent to lead a decline in phone shares. Talisman Energy Inc. dropped 1.6 percent as crude retreated to a five-week low. Detour Gold Corp. jumped 4.7 percent as gold producers rallied. BlackBerry Ltd. added 5.2 percent after the smartphone maker hired Ron Louks, a former HTC Corp. and Sony Ericsson executive, to run its devices business.

The Standard & Poor’s/TSX Composite Index fell 53.32 points, or 0.4 percent, to 13,495.54 at 4 p.m. in Toronto. The gauge has fallen 0.9 percent in the past three sessions.

“Investors are still looking for an overriding theme for the year,” said Patrick Blais, a fund manager at Manulife Asset Management Ltd. in Toronto. His firm manages about C$265 billion ($248.8 billion). “We’re waiting for quarterly earnings to start. This is the year companies need to start delivering in the top line and in the bottom line.”

Valeant Pharmaceuticals International Inc. retreated 3.7 percent to C$119.99 for a second day of losses as health-care stocks sank 3.2 percent, the most in the S&P/TSX. Six of 10 industries dropped in the benchmark equity gauge on trading volume 13 percent lower than the 30-day average.

Bank of Nova Scotia, the third-largest lender in Canada, dropped 1.1 percent to C$64.74 to pace declines among financials stocks. Toronto-Dominion Bank of Canada lost 0.9 percent to C$97.99 and Royal Bank of Canada fell 1 percent to C$70.70.

Federal Finance Minister Jim Flaherty said Canada’s housing market was cooling and he was less worried about a bubble forming, in part due to changes his government has made to mortgage-lending rules.  “We’ve tightened the rules four times on mortgage insurance and if we have to tighten them again we will,” Flaherty said in an interview broadcast yesterday on CTV’s “Question Period.”

Telus declined 1.2 percent to C$36.35 and BCE fell 0.6 percent to C$45.33. Telus on Jan. 3 lost a court battle with the federal government over the mobile-phone carrier’s request for a judicial review of a decision to limit the amount of wireless spectrum the nation’s largest carriers were allowed to buy in an upcoming auction, the Globe and Mail reported. The frequencies are necessary for use with high-speed data devices.

Energy shares slid 0.3 percent for a third day of declines as crude fell to a five-week low in New York. Talisman Energy dropped 1.6 percent to C$12.16.

Detour Gold Corp., the worst-performing stock in the S&P/TSX in 2013, jumped 4.7 percent to C$5.17 and B2Gold Corp. rallied 2.6 percent to C$2.35. The price of gold settled little changed in New York after earlier falling as much as 2.1 percent.

Tourmaline Oil Corp. gained 3.9 percent to C$46.41, for a record close. The oil producer estimated its daily production volumes reached a record of 111,200 barrels of oil equivalent per day in the second half of December following the start up of two gas plant expansions.

The company said it will reach its 2014 forecast average daily production of 118,000 barrels a day in the second half of February.

BlackBerry climbed 5.2 percent to C$8.51, the highest level in two months. Chief Executive Officer John Chen has replaced several members of his senior management team since taking over in November as BlackBerry works to reignite demand for its smartphones.

USA

By Nick Taborek

Jan. 6 (Bloomberg) — U.S. stocks fell for a third day, the longest stretch of declines to start a year for the Standard & Poor’s 500 Index since 2005, after slower-than-forecast growth in service industries.

Twitter Inc. fell 3.9 percent after Morgan Stanley said investors should sell the shares because the microblogging service may lose online advertising revenue to larger rivals like Facebook Inc. Whole Foods Market Inc. fell 3.5 percent after an analyst report cited risks from increased competition.  Verizon Communications Inc. climbed 0.6 percent after T-Mobile US Inc. agreed to buy airwaves from Verizon Wireless for about $2.4 billion. Financial shares in the S&P 500 added 0.2 percent, the second-biggest gain among the 10 main industries.

The S&P 500 slid 0.3 percent to 1,826.77 at 4 p.m. in New York. The Dow Jones Industrial Average lost 44.89 points, or 0.3 percent, to 16,425.10. About 6.5 billion shares changed hands on U.S. exchanges, about 9 percent above the three-month average, according to data compiled by Bloomberg.

“Today is just noise back and forth, up a little down a little,” Donald Selkin, who helps manage about $4 billion as the New York-based chief market strategist at National Securities Corp., said by phone. “I think we’re just going to go sideways until we see the Fed’s minutes and the jobs report on Friday.”  The ADP Research Institute reports the change in companies’ payrolls on Wednesday and minutes from the Fed’s Dec. 17 to 18 meeting will be released the same day. The Labor Department will provide the unemployment rate and new hiring figures for last month on Friday.

Stocks trimmed losses earlier after Blackstone Group LP’s Byron Wien forecast U.S. economic growth of more than 3 percent for 2014. Wien, vice chairman of Blackstone’s advisory services unit, said in his annual “10 Surprises” list that economic growth will top 3 percent this year. He predicted the S&P 500 will advance about 20 percent in 2014 after a sharp correction.

“It’s a relatively quiet news day, so a relatively bullish forecast by a respected strategist didn’t hurt at all today, and may have helped,” Richard Sichel, chief investment officer at Philadelphia Trust Co., said in a telephone interview. He helps oversee $1.9 billion. “There’s still good values out there. With reasonable price-earnings ratios, we think that people should be investing.”

The gauge has declined in each of the year’s first three trading sessions, losing 1.2 percent, for the first time since 2005, according to data compiled by Bloomberg. The S&P 500 slid 2.3 percent in the first three days of 2005, and recovered to gain 3 percent for the year.

Before this year, the S&P 500 had fallen each of the first three trading days of the year seven times since data on the index began in 1928. It posted an annual gain in six of those seven years, according to the data.

The Institute for Supply Management’s non-manufacturing index decreased to 53 in December from 53.9 in the prior month, a report from the Tempe, Arizona-based group showed today. The median projection in a Bloomberg survey of 69 economists was 54.7. Estimates ranged from 53 to 57.7.

Twitter dropped 3.9 percent to $66.29. Morgan Stanley lowered its rating on the social-networking company to underweight, or sell, from equal weight, or hold.

“Twitter stock is trading above our $61 bull case and appears to price in an approximate tripling of Twitter’s share of the socially enabled ad market within three years,” the brokerage wrote in a report to investors. “In our view, success is far from guaranteed at this early stage.”

The company’s shares have more than doubled since their market debut in November.

Whole Foods lost 3.5 percent to $54.30. Longbow Research LLC analyst Philip Terpolilli said in a report that the company’s profit margin may fall as it increases discounts amid higher competition.

EBay Inc. slid 2.8 percent to $51.78. Morgan Stanley cut the online auction company to equalweight from overweight.

First Solar Inc. lost 9.7 percent to $51.26 for the biggest drop in the S&P 500. Goldman Sachs Group Inc. analyst Brian Lee cut the stock to sell from buy, saying the company’s valuation may contract as earnings decline.

Verizon, the largest U.S. wireless carrier, gained 0.6 percent to $48.69. T-Mobile agreed to buy airwaves from Verizon Wireless for about $2.4 billion in cash as part of a spectrum swap that will give both companies more network capacity in areas where they need it. T-Mobile, the fourth-largest U.S. wireless carrier, advanced 3.7 percent to $33.48.

Boston Scientific Corp. climbed 3.4 percent to $12.33.  Morgan Stanley raised the maker of the Watchman heart implant to overweight, or buy, from equal weight, or hold. The brokerage said the company’s sales will improve in 2014 and future years, while the shares may reach $15 a piece.

Valuations in the S&P 500 increased by the most since the financial crisis last year as 460 stocks rose, more than any year since at least 1990. Neither are reasons to bet against equities now.

While Wall Street strategists are the most cautious in almost a decade after the broadest U.S. rally on record sent price-earnings ratios up 19 percent, expanding multiples have preceded advances twice as often as they have retreats, data compiled by Bloomberg show. Since 1936, the S&P 500 has risen 69 percent of the time following quarters when valuations widened, the data show. The average return is 14 percent in years after more than 400 constituents climbed, according to data compiled by Strategas Research Partners.

“One sign that things are becoming more popular is they’re more expensive,” Michael Shaoul, the chief executive officer of Marketfield Asset Management LLC, which oversees about $19 billion, said in a Jan. 2 interview in New York. “I would be quite surprised if this bull market didn’t continue for another two to three years.”

Markets for stocks, currencies, bonds and commodities are the calmest in at least 12 years amid investor confidence that central bank stimulus is spurring economic growth.

Expectations for price swings have fallen to the lowest on record for 29 assets, including U.S. equities, interest rates, the euro and oil, based on data since 2002 compiled by New York- based hedge fund Lake Hill Capital Management LLC. The implied volatility, a gauge of options prices, for the markets reached an average of 15.3 on Nov. 22, compared with an all-time high of 44.2 in 2008, data on two-month exchange-traded contracts show.

 

Have a wonderful evening everyone.

 

Be magnificent!

 

Wise people are concerned only with what lies behind all these things.

Just as bees fly from one blossom to another, looking only for the essence of each one,

wise people look only for the essence of every person they meet.

Wise people, who know and understand the soul, are indifferent to both pleasure and pain;

they have risen above sensations.  They are indifferent to the past and the future; they have risen above time.

They are indifferent to danger; they have risen above fear.

Wise people know that what is here, is also there;

that what was, will also be.

They see unity, not division.

Katha Upanishad

As ever,

 

Carolann

 

We are ever dying to one world and being born

into another.

-Henry David Thoreau, 1817-1862.

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

Senior Vice-President &

Senior Investment Advisor

Queensbury Securities Inc.,

St. Andrew’s Square

Suite 340A, 730 View St.,

Victoria, B.C. V8W 3Y7

 

 

Dear Friends,

Tangents:

As Carolann is out of the office this afternoon, I will be writing the newsletter on her behalf.

For the past few months, I have been experimenting with different recipes and last night I made an amazing salmon dish that was fabulous! Feel like trying out a new dish? I highly recommend the margarita-style barbecued salmon that took about 30 minutes to cook! It was delicious!

Ingredients

1 whole pink or other salmon

1/4 cup tequila

1 tsp finely grated lime zest

2 Tbsp lime juice

1 tsp finely grated orange zest

2 Tbsp orange juice

2 Tbsp brown sugar

2 Tbsp butter, melted

• salt and freshly ground black pepper, to taste

1 large lime, sliced

1 large orange, sliced

Trim the tail and fins from the fish, and rinse it with cold water and pat dry.

With a sharp knife, make shallow, diagonal cuts into the skin at one-inch intervals on both sides of the fish.

Combine the tequila, citrus zest and juice, and sugar in a sided dish just large enough to hold the fish. Add the salmon and turn to coat. Brush some of the marinade into the cavity of the fish. Cover, marinate and refrigerate salmon for one hour, turning occasionally.

Preheat barbecue to medium-high (about 450 F in the chamber). Slightly overlap two, two-foot long sheets of aluminum foil. Set a third two-foot long sheet of foil on top and in the centre of the first two sheets.

Arrange the lime and orange slices in a row down the centre of the third sheet of foil. Set the fish on the lime and orange slices. Spoon the marinade in the dish over the fish. Drizzle fish with melted butter; season with salt and pepper.

Fold the foil over the fish and crimp at the top to seal. Place the foil package on one side of the barbecue. Turn the heat off directly underneath the fish; leave the other side set to medium-high. Close the lid and cook the fish 25 to 30 minutes, or until cooked through and the internal temperature of the fish at its thickest point reaches 145 F on an instant-read thermometer.

Serve the salmon from the foil, or, for a fancier presentation, carefully transfer the fish and its juices to a large platter and serve it from there.

“Once you replace negative thoughts with positive ones, you’ll start having positive results.”
Willie Nelson

Photos of the Day:

Men watch Mount Sinabung spewing volcanic materials during an eruption in Tiga Kicat, North Sumatra, Indonesia. The 8,530-foot-tall volcano has erupted sporadically since September. Binsar Bakkara/AP

People look at the Mediterranean sea from La Promenade des Anglais on a rainy day in Nice, France. Lionel Cironneau/AP

Market Closes for January 3^rd, 2014

Market  Index	Close	Change
Dow  Jones	16469.99	+28.64    +0.17%
S&P 500	1831.35	-0.63    -0.03%
NASDAQ	4131.906	-11.163    -0.27%
TSX	13550.18	-44.01
		-0.32%

International Markets

Market  Index	Close	Change
NIKKEI	16291.31	+112.37
		+0.69%
HANG  SENG	22817.28	-522.77
		-2.24%
SENSEX	20851.33	-37.00
		-0.18%
FTSE 100	6730.67	+12.76
		+0.19%

Bonds

Bonds	% Yield	Previous % Yield
CND.  10 Year Bond	2.753	2.740
CND.   30 Year Bond	3.216	3.211
U.S.   10 Year Bond	2.9911	2.9890
U.S.   30 Year Bond	3.9212	3.9230

Currencies

BOC Close	Today	Previous
Canadian $	0.93996	0.93731
US   $	1.06387	1.06688
Euro Rate  1 Euro=		Inverse
Canadian   $	1.44570	0.69171
US  $	1.35890	0.73589

Commodities

Gold	Close	Previous
London Gold   Fix	1237.02	1226.20
Oil	Close	Previous
WTI Crude Future	93.96	95.44
BRENT	109.360	109.360

Market Commentary:

Canada

By Eric Lam

Jan. 3 (Bloomberg) — Canadian stocks fell a second day, extending the biggest loss in three weeks, as energy and raw- materials producers declined.

Crew Energy Inc. lost 2.5 percent as crude slipped a fourth day. Teck Resources Ltd. slid 2.5 percent as the price of copper retreated the most in five weeks.

The Standard & Poor’s/TSX Composite Index fell 45.34 points, or 0.3 percent, to 13,548.85 at 4 p.m. in Toronto. The index rose 9.6 percent for 2013, its largest annual gain since 2010.

“We haven’t really started the new year yet, people are waiting for earnings,” said John Kinsey, fund manager with Caldwell Securities Ltd. The firm manages about C$1 billion ($940.9 million). “The market’s had a good run, price earnings multiples have gone up, so now investors are a little cautious hoping things won’t disappoint.”

Crew Energy dropped 2.5 percent to C$6.36 as energy stocks declined 0.5 percent as a group. Eight of 10 industries in the benchmark index retreated. Trading volume was 32 percent lower compared with the 30-day average at this time of the day.

Penn West Petroleum Ltd. lost 1 percent to C$9.09 and Talisman Energy Inc. fell 0.6 percent to C$12.36 as crude for February delivery declined 1.6 percent to settle at $93.96 a barrel in New York. The price has slumped 6.3 percent in the past week, capping the biggest weekly decline in 19 months.

Teck Resources, Canada’s largest diversified miner, lost 2.5 percent to C$26.89 as the price of copper fell the most in five weeks. A gauge of Chinese services industries reached a four-month low, fanning concern about the demand outlook in the biggest global consumer of the metal.

Raw-materials shares slumped 1 percent, the most in the S&P/TSX. The group was the worst performer among 10 industries in the benchmark equity gauge last year, sliding 31 percent.

Detour Gold Corp., the worst-performing stock in the S&P/TSX in 2013, rallied 8.3 percent to C$4.94. The stock has jumped 23 percent in the past three days. The company re-opened a production mill facility at its Detour Lake gold mining project yesterday.

Alacer Gold Corp. increased 3.6 percent to C$2.32 and Semafo Inc. rose 4.2 percent to C$2.99 as gold for February delivery climbed 1.1 percent to $1,238.60 to extend its rally from the biggest annual loss in three decades.

BlackBerry Ltd., the struggling smartphone maker, declined 1.5 percent to C$8.09. The company yesterday said it was parting ways with R&B singer Alicia Keys, who was hired as global creative director in January 2013. The singer began her yearlong partnership with BlackBerry as the Waterloo, Ontario-based company began rolling out its BlackBerry 10 smartphones.

US

By Callie Bost

Jan. 3 (Bloomberg) — U.S. stocks fell a second day, following the biggest annual rally for the Standard & Poor’s 500 Index in 16 years, as investors weighed comments from Federal Reserve officials on stimulus and the economy’s strength.

General Motors Co. fell 3.4 percent after December sales missed estimates. Sprint Corp. dropped 4.4 percent as Stifel Nicolaus & Co. downgraded the mobile-phone operator to sell from hold. FireEye Inc. soared 39 percent after acquiring Mandiant Corp. in a $1.05 billion deal that consolidates providers of services that protect computer networks against hackers and spies.

The S&P 500 dropped less than 1 point to 1,831.37 at 4 p.m. in New York. The Dow Jones Industrial Average advanced 28.64 points, or 0.2 percent, to 16,469.99. About 5.3 billion shares changed hands on U.S. exchanges, 11 percent below the 30-day average.

“Today is portfolio balancing and a little bargain hunting after the selloff yesterday,” Donald Selkin, who helps manage about $4 billion as the New York-based chief market strategist at National Securities Corp, said in a telephone interview.

“There was no fundamental reason for the decline yesterday. Everyone was kind of stunned.”

The index’s drop on Jan. 2 snapped a streak of five straight gains on the first trading session of January, as investors sold shares following the best annual rally since 1998. The Dow average climbed 27 percent last year for its best performance since 1995.

The S&P 500 fluctuated today, erasing an earlier loss of as much as 0.2 percent after Fed Chairman Ben S. Bernanke said the headwinds that have held back the U.S. economy may be abating, leaving the country poised for faster growth. The gauge erased that gain in the final half hour of trading.

“The combination of financial healing, greater balance in the housing market, less fiscal restraint, and, of course, continued monetary policy accommodation bodes well for U.S. economic growth in coming quarters,” Bernanke said today in remarks prepared for a speech in Philadelphia. The chairman, who has led the central bank during its record quantitative-easing program, ends his eight-year tenure on Jan. 31.

Central bank officials said last month they will reduce their monthly purchases of assets to $75 billion from $85 billion starting this month, citing faster-than-estimated economic growth.

Bernanke said the decision to taper bond purchases “did not indicate any diminution of its commitment to maintain a highly accommodative monetary policy for as long as needed.”

“What he was trying to do is rationalize the decision, saying we did the right thing with the headwinds disappearing,” Selkin said. “The key here is the continued monetary policy accommodation, he’ll keep the Fed funds low and that’s what the market wanted to hear.”

Fed policy makers will continue to weigh stimulus reductions because improvements in the job market are meeting the central bank’s objectives, Richmond Fed President Jeffrey Lacker said today at a Maryland Bankers Association forum in Baltimore.

“It made sense to initiate the process of bringing the program to a close,” Lacker said. “I expect further reductions in the pace of purchases to be under consideration at upcoming meetings.”

The Federal Open Market Committee, scheduled to meet Jan. 28-29, will probably reduce its purchases in $10 billion increments over the next seven meetings before ending them in December, according to a Bloomberg News survey of economists after the FOMC announced its tapering on Dec. 18. The Fed will release minutes from its last meeting on Jan. 8.

Fed Bank of Philadelphia President Charles Plosser, an opponent of bond purchases by the Fed, said central bankers may be too optimistic they can smoothly pull back accommodation.

“We like to believe that everything is going to be gradual, everything is going to be smooth, and everything is going to be hunky-dory,” Plosser said during a discussion at the Philadelphia conference. “History does suggest that the Fed, as an institution, is oftentimes late when it comes to tightening.”

Three rounds of stimulus have helped propel the S&P 500 higher by as much as 173 percent from a 12-year low in 2009.

Equity returns will slow this year, Wall Street strategists forecast. The index will end 2014 at 1,950, according to the average of 20 estimates compiled by Bloomberg. That represents a 5.5 percent gain from the end of 2013.

Analysts estimate earnings for S&P 500 companies in the fourth quarter grew by 5.2 percent, according to data compiled by Bloomberg. Alcoa Inc. will unofficially begin the reporting season when it discloses results after the markets close on Jan. 9.

The Chicago Board Options Exchange Volatility Index, the gauge of S&P 500 options known as the VIX, fell 3.3 percent to 13.76, halting a four-day rally. The gauge finished 2013 with a 24 percent drop, the largest decline since 2009.

Seven of 10 main S&P 500 groups retreated today. Phone companies dropped the most, losing 0.7 percent as a group.

Verizon Communications Inc. slid 1.2 percent to $48.42 for the biggest retreat in the Dow.

T-Mobile US Inc. lost 3.3 percent to $32.28. AT&T Inc. is targeting customers of smaller rival T-Mobile by offering customers of the fourth largest U.S. carrier as much as $450 in credits for devices and services for each line they switch. AT&T fell 0.4 percent to $34.80.

Sprint dropped 4.4 percent to $9.94 after Stifel downgraded the company. The brokerage said Sprint would struggle to obtain regulatory approval for a merger with T-Mobile US.

General Motors declined 3.4 percent to $39.57. The carmaker reported December sales plunged 6.3 percent while analysts estimated on average sales would rise.

The Standard & Poor’s 500 Automobiles & Components Index fell 0.8 percent as the biggest automakers in the U.S. market reported December sales that fell short of analysts’ estimates.

Cold weather may have kept buyers from dealer lots at the end of the industry’s best year since 2007.

Micron Technology Inc. dropped 3.2 percent to $20.97 for a second day of losses. RBC Capital Markets LLC analyst Doug Freedman downgraded the chipmaker to sector perform from outperform, saying Micron’s valuation does not take risks enough into account. The stock rose 243 percent last year, the second- best performance in the S&P 500, and trades at 86 times reported earnings.

Exelon Corp. declined 2 percent to $26.62. Citigroup Inc. gave the shares a sell rating, while Bank of America Corp. downgraded them to underperform, which is similar to a sell rating, from neutral.

FireEye, which offers security for e-mail, files and websites, surged 39 percent to $57.02, the highest level since the shares began trading in September. A venture-capital firm set up by the Central Intelligence Agency invested in FireEye in 2009. Mandiant specializes in detecting malware and responding to incidents.

Delta Air Lines Inc. rose 5.5 percent to $29.23 for the biggest gain in the S&P 500. The airline carrier reported that a key revenue metric rose 10 percent in December over the same month a year prior. The company also said it expects to report more than $1 billion in operating cash flow from last month.

Sirius XM Holdings Inc. advanced 2 percent to $3.57 after Evercore Partners Inc. analyst Bryan Kraft raised the stock to overweight from equalweight.

 

Have a wonderful weekend everyone!!!

 

Be magnificent!

 

“A little more persistence, a little more effort, and what seemed hopeless failure may turn to glorious success.”
Elbert Hubbard

 

As ever,

 

Amanda Bourke

Assistant to Carolann Steinhoff

Queensbury Securities Inc.

 

St. Andrew’s Square

Suite 340A, 730 View St.,

Victoria, B.C. V8X 3Y7

 

Dear Friends,

Tangents:

As Carolann is out of the office this afternoon, I will be writing the newsletter on her behalf.

Happy New Year Everyone!!!! Hope everyone had a wonderful holiday season spent with friends and family.  How did everyone spend their New Years Day? Many Victorian’s headed down to Thetis Lake to take a plunge in the cold water for the 38^th annual Polar Bear Swim!  Every year there is always an array of costumes.  This year there were girls dressed up as Hawaiian hula dancers, people wearing masks and one man even dressed up as a lobster!  Were your brave enough to take the plunge this year?

Participants run into Lake Washington during the 12th annual Polar Bear Plunge in Seattle. Hundreds participated in the chilly New Year’s Day tradition organized by Seattle Parks and Recreation. David Ryder/Reuters

“A leader is one who knows the way, goes the way, and shows the way.”
John C. Maxwell

Photos of the Day:

Visitors skate at the Tower of London ice rink in London. Based on the grounds of the famous castle that is over a thousand years old, the temporary rink will remain open until January 5. Toby Melville/Reuters

A giant panda rests in a tree at Hangzhou’s zoo, Zhejiang province, China. China Daily/Reuters

Market Closes for January 2^nd, 2014

Market  Index	Close	Change
Dow  Jones	16441.35	-135.31    -0.82%
S&P 500	1831.98	-16.38    -0.89%
NASDAQ	4143.070	-33.520    -0.80%
TSX	13594.19	-27.36
		-0.20%

International Markets

Market  Index	Close	Change
NIKKEI	16291.31	+112.37
		+0.69%
HANG  SENG	23340.05	+33.66
		+0.14%
SENSEX	20888.33	-252.15
		-1.19%
FTSE 100	6717.91	-31.18
		-0.46%

Bonds

Bonds	% Yield	Previous % Yield
CND.  10 Year Bond	2.740	2.739
CND.   30 Year Bond	3.211	3.213
U.S.   10 Year Bond	2.9890	2.9703
U.S.   30 Year Bond	3.9230	3.9012

Currencies

BOC Close	Today	Previous
Canadian $	0.93731	0.93905
US   $	1.06688	1.06490
Euro Rate  1 Euro=		Inverse
Canadian   $	1.45809	0.68583
US  $	1.36669	0.73170

Commodities

Gold	Close	Previous
London Gold   Fix	1226.20	1199.40
Oil	Close	Previous
WTI Crude Future	95.44	99.29
BRENT	109.360	109.360

Market Commentary:

Canada

By Eric Lam

Jan. 2 (Bloomberg) — Canadian stocks fell the most in three weeks, after the benchmark index rose to its best annual performance in three years, as declines among energy companies and banks overshadowed a rally in gold and silver producers.

Canadian Natural Resources Ltd. and Suncor Energy Inc. retreated at least 1.2 percent as crude had the largest slump in more than a year. Detour Gold Corp. gained 11 percent after resuming milling operations at its mine. B2Gold Corp. and Silvercorp Metals Inc. rose more than 4.1 percent as precious metals prices surged.

The Standard & Poor’s/TSX Composite Index fell 27.36 points, or 0.2 percent, to 13,594.19 at 4 p.m. in Toronto, for the biggest decline since Dec. 11. The index rose 9.6 percent for 2013, its largest annual gain since 2010.

“It’s a bit of market malaise following a strong 2013, people are reassessing their portfolios,” said Brian Huen, fund manager with Red Sky Capital Management Ltd. in Toronto. The firm manages C$225 million ($212.1 million). “In the gold sector, people have stopped selling. People are looking at underperforming sectors from last year and making bets they won’t underperform like last year.”

Bank of Nova Scotia dropped 0.6 percent to C$66.01 and Toronto-Dominion Bank slipped 0.4 percent to C$98.87 as financial services stocks retreated 0.5 percent as a group.

Eight of 10 industries in the S&P/TSX declined on trading volume 26 percent lower compared with the 30-day average.

Manulife Financial Corp. fell 1.1 percent to C$20.73 and Great-West Lifeco Inc. dropped 1.4 percent to C$32.28 as 35 of 46 stocks in the S&P/TSX Financials Index declined.

Canadian Natural Resources dropped 1.6 percent to C$35.35 and Suncor Energy lost 1.2 percent to C$36.79 as crude prices sank 3 percent in New York for the biggest decline in almost 14 months.

Prices fell as an improving U.S. economy added to speculation the Federal Reserve will further curb stimulus. Data today showed applications for U.S. unemployment benefits declined last week.

A government report tomorrow will probably show U.S. crude supplies fell a fifth week, a Bloomberg survey showed.

Legacy Oil & Gas Inc. lost 1.3 percent to C$6.05 and Surge Energy Inc. slumped 3.4 percent to C$6.52.

Air Canada, the best-performing stock in the S&P/TSX in 2013, retreated 2 percent to C$7.26 for a third day of losses.

The stock surged 323 percent in 2013.

Detour Gold, the worst-performing stock in the benchmark equity gauge last year, jumped 11 percent to C$4.56. The company said the processing plant at its Detour Lake open pit gold mine is targeted to resume operations at a rate of 50,000 metric tons a day within a week of restart. Detour Gold had shut down the plant on Dec. 17.

Detour Gold lost 84 percent in 2013. Eight of the 10 worst- performing stocks in the S&P/TSX were gold mining companies.

B2Gold gained 4.1 percent to C$2.27 and Yamana Gold Inc. climbed 4.6 percent to C$9.58 as the price of gold jumped the most in three weeks on speculation demand for bars and jewelry will increase in Asia. Gold for February delivery rose 1.9 percent to $1,225.20 an ounce in New York. Novagold Resources Inc. surged 10 percent to C$2.97.

Silvercorp Metals surged 5.7 percent to C$2.58 and Silver Wheaton Corp. gained 5.9 percent to C$22.71 as silver rallied 3.9 percent to $20.13 an ounce.

Gold and silver prices plunged the most in more than 30 years in 2013 as investors lost faith in the metals as an alternative investment amid a U.S. equity rally and muted inflation.

US

By Alexis Xydias and Callie Bost

Jan. 2 (Bloomberg) — U.S. stocks declined, following the best year since 1997 for the Standard & Poor’s 500 Index, as technology shares retreated amid an analyst downgrade of Apple Inc.’s shares and investors weighed manufacturing data.

Apple fell 1.4 percent after Wells Fargo & Co. cut its rating on the stock, sending technology shares to the worst performance in the benchmark index. Analog Devices Inc. lost 3 percent after Goldman Sachs Group Inc. advised investors to sell the shares. Newmont Mining Corp. added 4.5 percent as gold futures rose the most in three weeks in New York.

The S&P 500 slid 0.6 percent to 1,837.09 at 11:16 a.m. in New York. The Dow Jones Industrial Average dropped 89.09 points, or 0.5 percent, to 16,487.57. Trading in S&P 500 stocks was 9 percent above the 30-day average at this time of day. U.S. markets were closed yesterday for New Year’s Day.

“More people seem to be wary, as we are, of potential corrections as markets get overexcited,”  Oliver Wallin, who helps oversee $5.6 billion as investment director at Octopus Investments Ltd. in London, said by phone. “The question is just when to time it. A lot of people are willing to continue in this rally but are nervous at the same time. We’ve got one eye on the exit but we know there is money to be made in the short term.”

The S&P 500 surged 30 percent in 2013, finishing the year at an all-time high for the first time since 1999. The index gained 2.4 percent in December, its fourth straight monthly advance, as the Federal Reserve announced plans to reduce the pace of bond buying amid faster-than-estimated economic growth.

Three rounds of Fed stimulus sent the S&P 500 up as much as 173 percent from a 12-year low in 2009.

The Dow average climbed 27 percent in 2013 for its best performance since 1995, led by Boeing Co. and American Express Co. International Business Machines Corp. is the only member of the 30-stock gauge that declined last year.

The first trading session of January has proven profitable for investors over the previous five years, with the S&P 500 gaining an average of almost 2 percent that day since 2009, according to data compiled by Bloomberg.

Improving economic data that bolstered optimism about strength in the world’s largest economy also helped propel equities higher last year.

Data today indicated applications for U.S. unemployment benefits declined last week to the lowest level in a month.

Jobless claims fell by 2,000 to 339,000 in the period ended Dec.28, Labor Department data showed. The median forecast of 26 economists surveyed by Bloomberg called for 344,000 claims.

A separate report showed the Institute for Supply Management’s factory index fell to 57 in December from the prior month’s 57.3, which was the highest since April 2011. Readings above 50 indicate expansion.

Reports from Europe today confirmed factory output in the euro area expanded last month at the fastest pace since May 2011 as Italy’s manufacturing beat estimates and Germany production grew for a sixth month. Data yesterday showed China’s official Purchasing Managers’ Index slipped to a four-month low in December, while a private report today also signaled manufacturing grew at a slower pace.

American consumers in 2013 were more upbeat than at any time in the previous six years as views on the economy, finances and the buying climate improved. The Bloomberg Consumer Comfort Index averaged minus 31.4 for 2013, the highest since 2007, when it was minus 10.5.

“I don’t think this sell-off will be a trend,” Walter Todd, who oversees about $950 million as chief investment officer of Greenwood Capital Associates LLC in Greenwood, South Carolina, said in a telephone interview. “In fact, I would expect the market to trade up into earnings season and January. Once people start getting a read on the fundamentals for companies and outlooks, that will dictate how the market goes from there.”

Analysts estimate earnings for S&P 500 companies in the fourth quarter grew by 5.2 percent, according to data compiled by Bloomberg. Alcoa Inc. will unofficially begin the reporting season when it discloses results after the markets close on Jan.9.

Analysts are predicting 116 stocks in the index will see price declines this year, according to average year-end targets compiled by Bloomberg. That’s the greatest number of bearish forecasts for the S&P 500 in nine years, the data show.

The average company in the index is estimated to rise 4.8 percent this year, according to the data. That’s the least optimistic forecast since Dec. 31, 2004, when the average was 4.7 percent. Alcoa Inc. and Harris Corp. are among the companies projected to fall the most this year.

The Chicago Board Options Exchange Volatility Index, the gauge of S&P 500 options known as the VIX, rose 2.5 percent to 14.06 today for a fourth straight day of increases. The gauge finished 2013 with a 24 percent drop, the largest decline since 2009.

All 10 main S&P 500 groups retreated today, with technology shares sliding 1 percent to pace losses. Intel Corp. dropped 1.6 percent to $25.54 for the biggest decline in the Dow.

Apple sank 1.4 percent to $553.32. Wells Fargo analyst Maynard Um cut the rating on the stock to market perform from outperform, saying the iPhone maker’s gross margin could come under pressure later in the year.

Analog Devices fell 3 percent to $49.43. Goldman Sachs analyst James Covello cut the circuit maker from sell from neutral and lowered the stock’s price target to $41 a share.

Wells Fargo analyst David Wong also downgraded the stock, to market perform from outperform, citing lower semiconductor demand through the end of last year.

Newmont Mining increased 4.5 percent to $24.06. Gold for February delivery advanced 1.7 percent in New York after the metal posted its largest annual decline in three decades.

Newmont fell 50 percent last year for the biggest decline in the S&P 500.

Retailers fell 0.1 percent for the second-best performance among 24 S&P 500 groups.

Urban Outfitters Inc. jumped 3.9 percent to $38.55.

Jefferies Group LLC analyst Randal Konik upgraded the clothing retailer to buy from hold. Urban Outfitters dropped 5.7 percent last year, making it the only consumer discretionary stock in the S&P 500 to decline.

American Eagle Outfitters Inc. rose 3.1 percent to $14.85 after Konik raise his rating to buy from hold.

 

Have a wonderful evening everyone.

 

Be magnificent!

 

“Wherever I go meeting the public… spreading a message of human values, spreading a message of harmony, is the most important thing.”
Dalai Lama

As ever,

 

Amanda Bourke

Assistant to Carolann Steinhoff

Queensbury Securities Inc.

 

St. Andrew’s Square

Suite 340A, 730 View St.,

Victoria, B.C. V8X 3Y7

 

Dear Friends,

Tangents:

As Carolann is out of the office this afternoon, I will be writing the newsletter on her behalf.

Looking for something to do with the kids before the clock strikes midnight tomorrow?  Playzone in Langford BC will be hosting a New Year’s celebration for kids with a countdown at 10pm!  It’s a fun, festive way to kick off the New Year with your children.  There will be crafts, face painting, snacks, ice skating, fire pits, balladium and many many more fun activities.  The party will finish after the countdown, which will give parents enough time to make it to another New Years engagement!  Make sure to check out this fun family activity!

Happy New Year everyone!

“I have a dream that my four little children will one day live in a nation where they will not be judged by the color of their skin, but by the content of their character.”
Martin Luther King, Jr.

Photos of the Day:

A bride poses for a photograph on Westminster Bridge as the fog clears in central London. Olivia Harris/Reuters

An aquarium staff member dressed in a Santa Claus costume embraces a Zebra shark as he swims with fish inside the Sunshine International Aquarium in Tokyo. Shizuo Kambayashi/AP

Market Closes for December 30^th, 2013

Market  Index	Close	Change
Dow  Jones	16504.29	+25.88    +0.16%
S&P 500	1841.07	-0.33    -0.02%
NASDAQ	4154.199	-2.395    -0.06%
TSX	13581.39	-6.59
		-0.05%

International Markets

Market  Index	Close	Change
NIKKEI	16291.31	+112.37
		+0.69%
HANG  SENG	23244.87	+1.63
		+0.01%
SENSEX	21143.01	-50.57
		-0.24%
FTSE 100	6731.27	-19.60
		-0.29%

Bonds

Bonds	% Yield	Previous % Yield
CND.  10 Year Bond	2.739	2.784
CND.   30 Year Bond	3.213	3.257
U.S.   10 Year Bond	2.9703	3.0037
U.S.   30 Year Bond	3.9012	3.9403

Currencies

BOC Close	Today	Previous
Canadian $	0.93905	0.93393
US   $	1.06490	1.07074
Euro Rate  1 Euro=		Inverse
Canadian   $	1.46911	0.68068
US  $	1.37957	0.72486

Commodities

Gold	Close	Previous
London Gold   Fix	1199.40	1214.25
Oil	Close	Previous
WTI Crude Future	99.29	100.32
BRENT	109.360	109.360

Market Commentary:

Canada

By Eric Lam

Dec. 30 (Bloomberg) — Canadian stocks fell, after a six- day rally pushed the benchmark gauge to a two-year high, as lower prices for gold and oil dragged down commodity shares.

Iamgold Corp. slid 5.7 percent as the metal retreated for the first time in four sessions in New York. Silver Wheaton Corp. lost 3.2 percent after silver tumbled. Pengrowth Energy Corp. dropped 1.8 percent after crude dropped below $100 a barrel in New York. Loblaw Cos. advanced 1.3 percent to lead consumer-staples producers higher.

The Standard & Poor’s/TSX Composite Index fell 6.59 points, or 0.1 percent, to 13,581.39 at 4 p.m. in Toronto. The benchmark equity gauge had rallied 3.1 percent in the previous six sessions to the highest level since May 2011. Trading volume was 51 percent below the 30-day average.

“We’ve had a tremendous run, especially in the U.S.,” said Ian Nakamoto, director of research with MacDougall MacDougall & MacTier Inc. in Toronto. His firm manages about C$4.7 billion ($4.4 billion). “People in the Canadian market have a dilemma on what to do with the materials sector. Most people are waiting to see what’s going to happen when it comes to economic performance. It’s a race between supply coming on stream and demand.”

The S&P/TSX has risen 9.2 percent this year, on pace for the best annual performance since 2010. The gauge has been the fourth-worst among developed markets this year ahead of Austria, Hong Kong and Singapore. The S&P 500, the U.S. equities benchmark, has rallied 29 percent. The index was little changed today.

Materials stocks have fallen 32 percent as a group in 2013, the most among 10 S&P/TSX industries. The gauge of miners dropped 1.6 percent today to pace declines.

Gold for February delivery fell 0.8 percent in New York today. The price has tumbled 28 percent in 2013, on track for the worst annual plunge since 1981 as some investors lost faith in the metal as a store of value amid a rally in equities and an improving economy.

The S&P/TSX Gold Index plunged 3.2 percent, extending its slide in 2013 to 46 percent. Iamgold retreated 5.7 percent to C$3.50 and Yamana Gold Inc. lost 3.3 percent to C$9.02.

Silver Wheaton fell 3.2 percent to C$21.24 and Silvercorp Metals Inc. sank 2.5 percent to C$2.37. Silver for March delivery dropped 2.2 percent in New York. Through Dec. 27, the metal has tumbled 34 percent this year, on course for the biggest annual slump since 1981.

Energy stocks dropped 0.2 percent as crude slipped below $100 a barrel in the biggest decline in two weeks. Pengrowth Energy lost 1.8 percent to C$6.55.

Producers of consumer staples increased 0.7 percent as a group for the second-biggest gain among 10 main index groups.

Canadian consumers are heading into 2014 with more confidence than a year ago, buoyed by optimism that jobs are more secure and real-estate prices will rise, according to the Bloomberg Nanos Canadian Confidence Index, released today.

Loblaw advanced 1.3 percent to C$42.55 and Shoppers Drug Mart Corp. rose 0.8 percent to C$58.26.

Health-care stocks gained the most, adding 1.9 percent as a group to push the annual gain to 72 percent. Valeant Pharmaceuticals International Inc. jumped 2.8 percent to $124.94, a fourth-straight gain that extended an all-time high.

US

By Callie Bost

Dec. 30 (Bloomberg) — U.S. stocks fluctuated, after the Standard & Poor’s 500 Index reached an all-time high last week and headed toward its biggest annual gain since 1997.

Facebook Inc. declined 2.2 percent, retreating for the third straight trading session. Twitter Inc. fell 2 percent, extending losses after a 13 percent drop on Dec. 27. Walt Disney Co. jumped 2.2 percent after an analyst upgrade. Crocs Inc. rose 21 percent after saying its chief executive officer will retire and Blackstone Group LP will invest $200 million in convertible preferred stock in the maker of colorful plastic clogs.

The S&P 500 fell less than 0.1 percent to 1,840.47 at 3:20 p.m. in New York. The benchmark index is poised for a 29 percent gain this year. The Dow Jones Industrial Average rose 11.65 points, or 0.1 percent, to 16,490.06 today. Trading in S&P 500- listed stocks was 34 percent below the 30-day average at this time of day.

“It’s a slow market right now without any dramatic news and I don’t see much happening between now and trading through close tomorrow,” John Carey, a fund manager at Pioneer Investment Management, which oversees about $220 billion, said in a telephone interview. “Then we’re off to the races in the new year.”

The S&P 500 has gained 1.9 percent in December, heading for its fourth straight monthly advance. The gauge climbed 3.7 percent from Dec. 13 through Dec. 27, its biggest two-week rally since July, as the Federal Reserve announced plans to reduce the pace of bond buying amid faster-than-estimated economic growth.

Three rounds of stimulus, known as quantitative easing, have sent the S&P 500 up 172 percent from a 12-year low in 2009.

Pending home sales increased 0.2 percent, the first gain in six months, after a 1.2 percent drop in October that was larger than initially reported, the National Association of Realtors said today in Washington. The median projection in a Bloomberg survey of economists called for a 1 percent advance.

Five years after the equity bull market started, U.S. investors returned to stocks in 2013, just in time for the best relative returns versus bonds on record.

Exchange-traded and mutual funds investing in shares took in about $162 billion, the most since 2000, according to data compiled by Bloomberg and the Investment Company Institute. At the same time, the S&P 500’s 29 percent advance has beaten government debt by 32 percentage points, the widest spread since at least 1978, according to data compiled by Bank of America Merrill Lynch and Bloomberg.

“The equity culture is not dead,” Joseph Quinlan, the chief market strategist at Bank of America Corp.’s U.S. Trust, said in a Dec. 13 phone interview from New York. His firm oversees $333 billion in client assets. “We kind of lost sight of the fact that equities still provide long-term good returns.”

Equity returns will slow next year, Wall Street strategists forecast. The S&P 500 will end 2014 at 1,950, according to the average of 20 estimates compiled by Bloomberg. That represents a 5.9 percent gain over the next 12 months.

The Chicago Board Options Exchange Volatility Index, the gauge of S&P 500 options known as the VIX, rose 8 percent to 13.46 today, poised for a second day of gains. The gauge has dropped 25 percent this year.

Energy producers dropped 0.6 percent for the biggest decline among main industries in the S&P 500. Pioneer Natural Resources Co. slid 2.9 percent to $182.09 while Tesoro Corp. decreased 1.2 percent to $56.71. Exxon Mobil Corp. lost 1 percent to $100.49 and Chevron Corp. slipped 0.6 percent to $124.44.

Facebook declined 2.2 percent to $54.20. Shares of the social-networking company have plunged 6.4 percent since reaching a record on Dec. 24. Facebook is poised for its biggest monthly gain since September, rallying 16 percent in December.

Twitter decreased 2 percent to $62.50. The social- networking company on Dec. 27 fell the most since it debuted on the New York Stock Exchange after Macquarie Capital downgraded the shares, saying they had risen “too far, too fast.”

Myriad Genetics Inc. fell 14 percent to $20.86. Piper Jaffray Cos. lowered its price estimate for the supplier of genetic tests to $29 from $36, citing a decision by the U.S. Centers for Medicare and Medicaid Services to reduce the reimbursement rate by about 49 percent for screening devices to help predict breast cancer risk.

Crocs rose 21 percent, the biggest jump since August 2009, to $16.12. CEO John McCarvel will step down on April 30. The shoemaker will use the Blackstone funds to increase stock repurchases to $350 million, Niwot, Colorado-based Crocs said.

Walt Disney jumped 2.2 percent to a record $76.01. The world’s largest entertainment company was raised to buy from neutral by Guggenheim Securities LLC analyst Michael Morris.

Morris’ 12-month target price is $87.

Cooper Tire & Rubber Co. rose 4.5 percent to $23.99 after it dropped plans to be bought by India’s Apollo Tyres Ltd., citing a lack of financing for the transaction, and said it will seek damages. Cooper said on June 12 that Apollo planned to buy the U.S. tiremaker for $35 a share in a $2.5 billion deal.

All 10 main industries in the S&P 500 have advanced this year, led by a 40 percent gain in consumer-discretionary companies. Phone companies have the weakest performance, with a 6.6 percent increase.

Netflix Inc. has soared 298 percent, the biggest gain this year in the S&P 500, as the world’s largest video-subscription company reported earnings that surged more than analysts forecast. Micron Technology Inc. has rallied 237 percent as the chipmaker is projected to return to a profit in the fiscal year ending in August.

Best Buy Co. has climbed 237 percent this year, rebounding after a 49 percent drop in 2012. Urban Outfitters Inc. has the only loss among consumer-discretionary shares, dropping 5.2 percent.

Newmont Mining Corp., has plunged 50 percent this year, the biggest annual loss in the S&P 500. The price of gold has dropped 28 percent in 2013, heading for its first annual loss since 2000. Cliffs Natural Resources Inc., the second-worst performer in the index, has lost 30 percent.

 

Have a wonderful evening everyone.

 

Be magnificent!

“Success is dependent on effort.”
Sophocles

As ever,

 

Amanda Bourke

Assistant to Carolann Steinhoff

Queensbury Securities Inc.

 

St. Andrew’s Square

Suite 340A, 730 View St.,

Victoria, B.C. V8X 3Y7

 

Dear Friends,

Tangents:

As Carolann is out of the office this afternoon, I will be writing the newsletter on her behalf.

This Christmas season was my first year hosting dinner at our house.  Being the type of person who likes to keep everyone well fed, I made too much of everything, resulting in an abundance of leftovers.  I came across an article today in the Globe and Mail which shares different ideas for leftover turkey, which was a blessing for me.  Here are a few different ideas:

Turkey scotch broth Even if you don’t intend to make soup, make stock and freeze it

Turkey fritters No one will believe this treat was made with leftovers

Turkey cakes Serve these favourites, which are similar to crab cakes, with a southwestern-style mayonnaise

Turkey and artichoke pie A great alternative to the usual sandwiches

Turkey fried rice This quick and easy recipe really comes in handy

Turkey club The classic gets a seasonal twist with cranberry sauce

Turkey with rice noodles An Asian-inspired way with leftovers

Turkey casserole A classic, just like mom used to make

“Let us be grateful to people who make us happy, they are the charming gardeners who make our souls blossom.”
Marcel Proust

Photos of the Day:

People wait in a bus line to pay their respects to former South African President Nelson Mandela in Pretoria. Thousands of people lined up to say goodbye to Mandela, whose body lay in state in the building where the anti-apartheid hero was inaugurated in 1994 as South Africa’s first black president. Kevin Coombs/Reuters

Western Wall and the Dome of the Rock, some of the holiest sites for for Jews and Muslims, are covered in snow in Jerusalem. Early snow has surprised many Israelis and Palestinians as a blustery storm, dubbed Alexa, brought gusty winds, torrential rains and heavy snowfall to parts of the Middle East. Dusan Vranic/AP

Market Closes for December 27^th, 2013

Market  Index	Close	Change
Dow  Jones	16482.29	+2.41    +0.01%
S&P 500	1841.55	-0.47    -0.03%
NASDAQ	4154.395	-12.785    -0.31%
TSX	13596.08	+78.06
		+0.58%

International Markets

Market  Index	Close	Change
NIKKEI	16178.94	+4.50
		+0.03%
HANG  SENG	23243.24	+63.69
		+0.27%
SENSEX	21193.58	+118.99
		+0.56%
FTSE 100	6750.87	+56.70
		+0.85%

Bonds

Bonds	% Yield	Previous % Yield
CND.  10 Year Bond	2.784	2.679
CND.   30 Year Bond	3.257	3.174
U.S.   10 Year Bond	3.0037	2.9274
U.S.   30 Year Bond	3.9403	3.8480

Currencies

BOC Close	Today	Previous
Canadian $	0.93393	0.94188
US   $	1.07074	1.06171
Euro Rate  1 Euro=		Inverse
Canadian   $	1.47177	0.67946
US  $	1.37453	0.72752

Commodities

Gold	Close	Previous
London Gold   Fix	1214.25	1198.99
Oil	Close	Previous
WTI Crude Future	100.32	98.66
BRENT	109.360	109.360

Market Commentary:

Canada

By Eric Lam

Dec. 27 (Bloomberg) — Canadian stocks rose a sixth day, extending a two-year high, as oil and gold producers advanced amid a rally in commodities prices.

Lightstream Resources Ltd. rallied 6.5 percent as West Texas Intermediate topped $100 a barrel for the first time in two months. Iamgold Corp. and Detour Gold Corp. jumped more than 5.8 percent as gold climbed a third day. BlackBerry Ltd. Slumped 4.7 percent after co-founder Mike Lazaridis reduced his stake in the company.

The Standard & Poor’s/TSX Composite Index rose 69.96 points, or 0.5 percent, to 13,587.98 at 4 p.m. in Toronto, the highest close since May 2011. The benchmark equity gauge has risen 9.3 percent this year, the fourth-worst performer among developed markets ahead of Austria, Hong Kong and Singapore.

Canadian markets were closed Dec. 25 and 26 for the Christmas holiday. Trading volume today was 49 percent below the 30-day average.

“It’s the Santa Claus rally, I’m a big believer in seasonals,” said Keith Richards, fund manager with ValueTrend Wealth Management in Barrie, Ontario. The firm manages C$108 million ($101 million). “I’ve been bearish on commodities, but gold and oil, which had been down, will probably be all right for the next few months.”

The S&P/TSX has added 1.4 percent in the three sessions this week, for a second weekly advance. The gauge has climbed 1.4 percent in December, on track for a sixth straight monthly increase.

Eight of 10 main industries in the equities benchmark climbed today. Raw-materials producers gained 1.3 percent to pace advances.

Iamgold increased 6.6 percent to C$3.71 and Detour Gold rose 5.8 percent to C$4.19. Gold futures for February delivery added 0.1 percent to settle at $1,214 an ounce as the price of the metal posted the longest rally since August. A weaker U.S. dollar increased demand for gold as a haven.

Detour Gold is the worst-performing stock in Canada this year, slumping 83 percent. Air Canada, the best-performing stock, rose 1.1 percent to C$7.49 today. The nation’s largest airliner has soared 328 percent in 2013.

Fortuna Silver Mines Inc. climbed 6.7 percent to C$3.02 and First Majestic Silver Corp. increased 4.1 percent to C$10.32 as silver added 0.7 percent in New York.

Sherritt International Corp. dropped 3.5 percent to C$3.70 to snap four days of gains after agreeing to sell assets including its coal interests on Dec. 24.

Lightstream Resources rose 6.5 percent to C$5.84 and Bellatrix Exploration Ltd. gained 3.3 percent to C$7.88 as crude for February delivery advanced 0.8 percent to $100.32 a barrel in New York.

Oil futures extended gains after the U.S. Energy Information Administration said stockpiles decreased to the lowest level since September.

BlackBerry tumbled 4.7 percent to C$7.83 to snap four days of gains, after the company’s former Chief Executive Officer Lazaridis reduced his stake in BlackBerry to 4.99 percent of outstanding shares. The former BlackBerry executive earlier this year had considered making a bid for the Waterloo, Ontario-based company with Doug Fregin, another co-founder.

US

By Inyoung Hwang and Alexis Xydias

Dec. 27 (Bloomberg) — U.S. stocks fell, with the Standard & Poor’s 500 Index trimming a weekly gain, after benchmark indexes rallied to all-time highs yesterday amid optimism over the economic recovery.

Twitter Inc. slid 13 percent after Macquarie Group Ltd. downgraded the stock. Delta Air Lines Inc. retreated 3.1 percent after the airline said yesterday it will honor tickets sold at incorrect prices on its website. Textron Inc. rose 1.1 percent after the manufacturer of Cessna aircraft said it will buy Beechcraft Corp. for $1.4 billion. FirstEnergy Corp. added 2.3 percent after the utility company was upgraded at Wells Fargo & Co. to outperform from market perform.

The S&P 500 fell less than 0.1 percent to 1,841.40 at the close in New York. The Dow Jones Industrial Average slipped 1.47 points, or less than 0.1 percent, to 16,478.41. Both measures posted their second weekly gain. Volume has been lower-than- average amid the Christmas holiday this week. About 4 billion shares changed hands on U.S. exchanges today, 34 percent below the three-month average, according to data compiled by Bloomberg.

“A year-end rally like this is not usual, but we have to keep in mind trading volumes are light and corporate news is certainly sparse this week,” Robert Landry, the San Antonio- based executive director and money manager at USAA Investments, said by telephone. His firm oversees about $59 billion. “You can’t read too much into the market’s move. It’s somewhat of a Santa Claus rally and perhaps that’s attributed to some portfolios managers in the office making some year-end moves.”

The S&P 500’s retreat today halted a four-day rally that was fueled by improving economic data. A Labor Department report yesterday showed that jobless claims declined by more than forecast, boosting optimism in the world’s largest economy.

There are no economic reports scheduled for today.

The benchmark equity index has advanced 29 percent in 2013, putting it on course for its biggest annual rally since 1997.

The S&P 500 has gained 2 percent so far this month. December has been the second-best month for U.S. equity returns, according to data compiled by Bloomberg that starts in 1928. The average gain for the month is 1.5 percent, more than twice the overall monthly mean of 0.6 percent. The last December retreat for the S&P 500 was in 2007.

The Federal Reserve, which has made employment creation a determinant factor of its monetary stimulus, said on Dec. 18 that it will reduce the pace of bond buying amid faster-than- estimated economic growth. Three rounds of stimulus, known as quantitative easing, have sent the S&P 500 as much as up 172 percent from a 12-year low in 2009.

“I don’t see why stocks can’t have a reasonable year in 2014, given that the global economy does seem to very slowly improve and Fed has started a tapering program,” Landry said.

“There are some things in place to suggest it could be a decent year for stocks but not on the magnitude we’ve seen this year.”

The Chicago Board Options Exchange Volatility Index, the gauge of S&P 500 options known as the VIX, rose 1.1 percent to 12.46, halting a four-day retreat. The gauge has dropped 31 percent this year, the largest annual decline since 2009.

Six of 10 main S&P 500 groups fell today, with producers of consumer discretionary products falling 0.4 percent to lead losses.

Twitter dropped 13 percent, the most since it began trading in November, to $63.75. The microblogging service was cut to underperform from neutral at Macquarie Group Ltd., which cited the stock’s 40 percent surge from Dec. 11 through yesterday.

Delta retreated 3.1 percent to $27.03. The airline said yesterday it will honor tickets sold at incorrect prices on its website and through other booking channels after customers snapped up bargains like a round trip to Hawaii for $6.90.

Energy producers added 0.5 percent for the biggest advance out of 10 groups in the S&P 500, as the price of crude topped $100. Nabors Industries Ltd. rallied 2.8 percent to $16.84 for the biggest gain since Nov. 8. Newfield Exploration Co. added 2 percent to $24.54, while Peabody Energy Corp. jumped 3.3 percent to $19.25.

Textron rose 1.1 percent to $36.61. The company, seeking to counter a slump in business-jet sales, agreed to buy Beechcraft to boost its lineup of propeller-driven aircraft.

Providence, Rhode Island-based Textron will purchase all outstanding equity interests in Beech Holdings LLC, the parent of Beechcraft, it said in a statement yesterday. The deal, which includes the repayment of Beechcraft’s working capital debt, will be financed by a combination of available cash and as much as $1.1 billion in new debt.

FirstEnergy added 2.3 percent to $32.79. The Akron, Ohio- based company was upgraded by Wells Fargo analyst Neil Kalton, who said a potential dividend cut of 40 percent is “integral” to a positive view on the shares.

 

Have a wonderful weekend everyone!!

 

Be magnificent!

 

“Education is the most powerful weapon which you can use to change the world.”
Nelson Mandela

As ever,

 

Amanda Bourke

Assistant to Carolann Steinhoff

Queensbury Securities Inc.

 

St. Andrew’s Square

Suite 340A, 730 View St.,

Victoria, B.C. V8X 3Y7