December 19, 2016 Newsletter

Dear Friends,

Tangents:

The Poem

Become Water
By Thomas McCarthy

Like us, the tide is seeking a cove
Where it doesn’t need to be obliging.  Love
in its secret cave may rise and fall
To its own moon: the beck and call
Of the sea won’t be heard.  The cliff face
Runs its mascara, such tears of disgrace.

As leaves the rocks with purple stains.
It is clear the sky has taken pains
To shoo such clouds away as might
Freckle the foreshore from a great height.
The tide’s scandalous incompetence
Is complete: the sea runs out of patience.

With every form of rock and pool –
This tide of love has never bent to any school
But ebbs in its own petulant way:
The way art or water does, you say;
The way all things that are fought for
Settle in a hidden cove and accept water.

From “Pandemonium” (Carcanet).
PHOTOS OF THE DAY

The St. Joseph lighthouse and pier are covered in ice on the southeastern shoreline of Lake Michigan on Monday in St. Joseph, Mich. Robert Franklin/South Bend Tribune/AP

People skate on an ice rink built at 57 meters (188 feet) above the ground on the Eiffel Tower in Paris on Monday. The rink will be open until Feb. 19. Michel Euler/AP
A surfing instructor dressed as Santa Claus gives a lesson to orphans on Kuta Beach, Bali, Indonesia, on Monday. Nyoman Budhiana/Antara Foto/Reuters
Market Closes for December 19^th, 2016

International Markets

Bonds

Currencies

Commodities

Market Commentary:
Canada
By Eric Lam
     (Bloomberg) — Canadian stocks rose for a third day as BlackBerry Ltd. advanced to lead a gain in technology shares after announcing a new research center for self-driving cars in Canada.
     The S&P/TSX Composite Index added 0.1 percent to 15,269.85 at 4 p.m. in Toronto, trading near the highest since April 2015. The gauge has risen 17 percent in 2016, the top performer among developed markets tracked by Bloomberg, ahead of No. 2 market Norway’s 14 percent advance.
     BlackBerry added 2.3 percent to halt a three-day slide as technology companies gained 1.6 percent as a group, the most in the S&P/TSX. BlackBerry and Canada are opening a research center for self-driving cars, to be based at the company’s QNX headquarters near Ottawa. BlackBerry CEO John Chen has focused his efforts on shifting the company away from its smartphone legacy into new areas including software.
     Fairfax Financial Holdings Ltd. slipped 1.5 percent after the financial services firm agreed to buy insurer Allied World Assurance Co. for $4.9 billion in cash and stock in CEO Prem Watsa’s largest purchase. Allied will operate as a wholly owned subsidiary, keeping its executive and senior management teams while Fairfax diversifies its business.
     In other moves:
* Onex Corp. rose 0.3 percent, reversing an earlier loss, after agreeing to buy a U.K. caravan holiday park operator Parkdean Resorts for 1.35 billion pounds in a deal expected to close in the first quarter of next year
* Concordia International Corp. jumped 9.7 percent after reporting a cash balance of $410 million, and as much as $200 million available under its undrawn revolving credit line; the drugmaker said it has access to sufficient liquidity to meet all of its near-term financial obligations.
US
By Oliver Renick
     (Bloomberg) — U.S. stocks inched higher as investors assessed a rally that has lifted equities to record levels in the past month.
     The S&P 500 Index added 0.2 percent to 2,262.53 at 4 p.m. in New York. The benchmark gauge fell 0.2 percent Friday after a report that China seized a U.S. drone in international waters in the South China Sea sparked geopolitical concerns. The Dow Industrials added 0.2 percent Monday as small-cap shares jumped 0.6 percent.
     European stocks closed little changed, after two straight weeks of gains, as investors kicked off the last full week of trading of the year. The Stoxx Europe 600 Index fell 0.1 percent at the close. In a reversal of the recent rotation into cyclical shares, banks and miners declined as defensive stocks including utilities, real estate and technology advanced.
* Phone and real estate shares gained as energy and health-care stocks fell
* Strategists on average expect the S&P 500 to end 2017 at 2356, according to the mean of 15 estimates compiled by Bloomberg; that’s 4.3% higher than the Friday close
* The benchmark gauge is poised for its fifth straight quarterly advance and is up more than 10% for the year
* All four major benchmarks reached all-time highs after the election; financials have led gains on bets higher borrowing costs will boost profitability
** S&P 500 Banks Index up 30% in the final quarter of 2016, the biggest advance among 24 industry groups
* After Federal Reserve officials said they expect three quarter-point rate increases next year, up from two seen in September, traders are pricing in a 73% chance of an increase in June 2017 — the first month with at least even odds for an increase
* EARNINGS
** After market Monday: Worthington Industries Inc. (WOR)
** Before market Tuesday: Patheon NV (PTHN), BlackBerry Ltd (BB CN), CarMax Inc (KMX), Darden Restaurants Inc (DRI), FactSet Research Systems Inc (FDS), General Mills Inc (GIS), Navistar International Corp (NAV), The Valspar Corp (VAL), Carnival Corp (CCL).                       
* The VStoxx Index of euro-area stock volatility was little changed near its lowest in more than two years, down 39% since the U.S. election, as speculation of stronger economic growth boosted equities
* The volume of Stoxx 600 shares traded on Monday was about a third lower than the 30-day average, data compiled by Bloomberg show
* Financials fell for a second day. Banca Monte dei Paschi di Siena SpA slid 11% after saying it will sell shares to institutional investors through Thursday, as it aims to complete raising funds by year-end to avoid a rescue by the Italian government
* Deutsche Bank AG slid 4.5% amid reports its settlement with the U.S. Department of Justice could come this week
* Barclays Plc declined 2.7% as the lender prepares to tell 7,000 clients to do more trading with the firm or find another bank, in a bid to boost returns
* The Stoxx 600 is on course for its first annual decline since the peak of the sovereign-debt crisis in 2011, while the FTSE 100 is poised for its best rally in three years as a post-Brexit slump in the pound boosted U.K. exporters
     For related equity market news:
* S&P 500 to Climb to 2450 Next Year: Oppenheimer’s Stoltzfus
* Top Bull Says Equity Market Due for Pause, Buy on Pullbacks
* A $55b Manager Who Bought at Market Low Returns to Cash
* Volatility of Volatility Rises Even as VIX Signals Calm: Chart
* European Stocks Ignore Selloff in Emerging Markets: Chart

Have a wonderful evening everyone.

Be magnificent!

Knowledge relieves all suffering.  Knowledge liberates.
Which knowledge?  Chemistry?  Physics?   Astronomy?  Geology?
They help a little, but only a little.  The true knowledge is the knowledge of our own nature.
Know yourself.  You must know who you are, understand your inner nature.
You must become conscious of this infinite nature in yourself.  Then you will break free of your shackles.
Swami Vivekananda

As ever,

Carolann

The man who makes no mistakes does not usually make anything.
                                           -Edward John Phelps, 1822-1900

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

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

Tel: 778.430.5808
(C): 250.881.0801
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www.carolannsteinhoff.com