December 20, 2013 Newsletter

Dear Friends,

Tangents:

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

Are you needing to bring an appetizer to a Christmas party over the next few days? Looking for something quick and simple? Try this tasty recipe!

Preparation time: 5 minutes

Ready time: 5 minutes

Ingredients

1/4 cup mango chutney

1/4 cup lime pickle

1 tsp Indian curry paste

1/4 cup mayonnaise

1/4 cup sour cream

2 tbsp chopped cilantro

Method

Combine all ingredients and serve with samosa crackers.

“Everything you are seeking is seeking you in return. Therefore, everything you want is already yours. It is simply a matter of becoming more aware of what you already possess.” – Bob Proctor

Photos of the Day:

Sculptor Juuso Partanen of Finland carves an ice sculpture of a tree at the Brussels Ice Magic Festival. Some 20 artists from all over the world made sculptures depicting characters from comic strips out of 420 tons of ice. Francois Lenoir/Reuters

A giant panda plays in the snow at a zoo in Kunming, Yunnan province, China. China Daily/Reuters

Market Closes for December 20^th, 2013

International Markets

Bonds

Currencies

Commodities

Market Commentary:

Canada

By Callie Bost

Dec. 20 (Bloomberg) — Canadian stocks rose to the highest level in two weeks and extended their biggest weekly advance since July as data showed the U.S. economy expanded more than forecast last quarter.

OceanaGold Corp. and China Gold International Resources Corp. increased at least 1.5 percent as the metal’s price rebounded. BlackBerry Ltd. soared 16 percent after it struck a five-year deal with Foxconn Group to manufacture its devices.

Martinrea International Inc. fell 5.8 percent, extending its losses for the week to 19 percent.

The Standard & Poor’s/TSX Composite Index increased 7.40 points, or less than 0.1 percent, to 13,399.60 at 4 p.m. in Toronto. That’s the highest level for the benchmark since Dec. 2 as it capped a gain for the week of 2.1 percent. The index trimmed earlier gains of as much as 0.8 percent in the final half-hour. Trading of stocks in the index was 75 percent higher than the 30-day average.

“Stronger-than-expected U.S. GDP is a positive for Canada and more so a positive for cyclical stocks like energy, materials and financials,” Andrew Pyle, a fund manager at ScotiaMcLeod Inc. in Peterborough, Ontario, said in a phone interview. He manages C$220 million ($205.6 million). “Energy and materials are creeping up and they weigh heavily on the indexes.”

U.S. gross domestic product climbed at a 4.1 percent annualized rate, the strongest since the final three months of 2011 and up from a previous estimate of 3.6 percent, Commerce Department figures showed. The median forecast of 72 economists surveyed by Bloomberg projected a 3.6 percent pace after 2.5 percent in the second quarter.

Canada’s consumer price index rose 0.9 percent in November from a year ago following a 0.7 percent rise the prior month, Statistics Canada said today. The result trailed the 1 percent median forecast in a Bloomberg survey in November. The core rate, which excludes eight volatile products, slowed to 1.1 percent from the 1.2 percent pace in October.

Gold prices gained 0.8 percent to $1,203.70 an ounce, after the precious metal tumbled 3.4 percent yesterday to the lowest settlement since August 2010. Gold, down 29 percent this year, is heading for its first annual decline since 2000.

Producers of raw materials in the S&P/TSX rose 0.5 percent.

OceanaGold jumped 4.8 percent to C$1.54 and China Gold increased 1.5 percent to C$2.74 Canadian cents. The S&P/TSX Gold Index rose 0.3 percent.

BlackBerry soared 16 percent, the biggest gain since November 2012, to C$7.74. Foxconn will make products for BlackBerry at plants in Indonesia and Mexico, according to a statement today. BlackBerry will own all of its intellectual property and handle quality assurance through Foxconn, an Apple Inc. supplier and the world’s largest manufacturer of electronic products.

The Canadian smartphone maker also reported a 56 percent drop in third-quarter sales to $1.19 billion, missing analysts’ estimates of $1.59 billion.

Methanex Corp. rose 2.8 percent to C$61.80. Raymond James Financial Inc. analyst Steven Hansen boosted the methanol producer’s rating to outperform from market perform.

Martinrea fell 5.8 percent to C$7.05, the lowest level since November 2012. Canada’s third-largest auto parts maker by market value slumped 21 percent yesterday after it warned one of its factories had misreported net income over eight years and said earnings would be lower than forecast.

US

By Lu Wang and Callie Bost

Dec. 20 (Bloomberg) — U.S. stocks rose, with the Standard & Poor’s 500 Index capping its biggest weekly gain since October, as data showing faster-than-estimated growth boosted confidence in the world’s largest economy.

Red Hat Inc. surged 14 percent as the software company raised its full-year profit and sales forecasts. Responsys Inc. jumped 40 percent as Oracle Corp. agreed to buy the marketing company for $1.5 billion in cash. CarMax Inc. declined 9.4 percent as the largest U.S. seller of used cars posted earnings that missed analysts’ estimates.

The S&P 500 added 0.5 percent to a record 1,818.32 at 4 p.m. in New York. The Dow Jones Industrial Average rose 42.06 points, or 0.3 percent, to 16,221.14, also an all-time high.

About 9.2 billion shares changed hands on U.S. changes in the busiest trading since June as futures and options contracts expired today in a process known as quadruple witching and the operator of the S&P 500 rebalanced the index in a quarterly move to adjust member weightings.

“The market is feeling somewhat confident,” said Robert Pavlik, chief market strategist in New York at Banyan Partners LLC, which manages about $4.5 billion. “It’s encouraging as an investor and consumer to see GDP get up to these levels. GDP reaching 4 percent makes you feel good about the economy and where we’re headed.”

The S&P 500 rose 2.4 percent this week, halting a string of two weekly declines and erasing a loss for the month, after the Federal Reserve’s decision to slow the pace of its stimulus boosted investor confidence that the recovery in the world’s largest economy is on course. The Dow’s weekly advance of 3 percent was its biggest since September.

Data today showed the rate of expansion in the third quarter was faster than previously estimated as consumers stepped up spending on services such as health care and companies invested more in software. Gross domestic product climbed at a 4.1 percent annualized rate, the strongest since the final three months of 2011 and up from a previous estimate of 3.6 percent, Commerce Department figures showed.

“This revised GDP number was really positive,” Colleen Supran, a principal at San Francisco-based Bingham, Osborn & Scarborough, which manages about $3 billion, said in a phone interview. “It helps complete the story on what the Fed did this week and that is, the Fed has some belief that the economy is getting close to being able to stand on its own.”

The S&P 500 has rallied 27 percent so far in 2013, on course for its best performance since 1997. Three rounds of central-bank bond purchases have helped propel the equity benchmark 169 percent higher from a 12-year low in 2009.

The Fed will probably reduce its bond purchases by $10 billion in each of its next seven meetings before ending the program in December 2014, according to the median forecast in a Bloomberg survey of 41 economists conducted on Dec. 19.

The Chicago Board Options Exchange Volatility Index dropped 2.5 percent today to 13.79. The gauge of S&P 500 options known as the VIX fell 13 percent this week.

Announced index changes, such as the addition of Facebook Inc.’s inclusion in the S&P 500, took effect after the markets’ closed.

Money managers needed to buy and sell about $13.8 billion of shares as they shuffled their funds to mimic changes in the S&P 500 quarterly rebalance, according to estimates from Howard Silverblatt, a senior index analyst at S&P Dow Jones Indices in New York. He forecast utility companies will see the biggest increase in their representation while the weighting of consumer staples will drop the most.

Nine of the 10 S&P 500 main industries advanced. Utility and technology shares rose more than 0.8 percent to lead gains.

Phone stocks fell 0.6 percent for the only decline.

Red Hat surged 14 percent to $56.10. Adjusted earnings for its 2014 financial year will be $1.46 to $1.48 per share, the company predicted, up from its previous forecast of $1.36 to $1.38. Revenue may be about $1.53 billion, exceeding the average analyst estimate for $1.51 billion.

Responsys soared 40 percent to $27.40. Oracle, the world’s largest seller of database software, agreed to buy Responsys for $27 a share, gaining marketing software that helps businesses sell to consumers. Oracle lost 0.6 percent to $36.37 after a four-day rally.

Jazz Pharmaceuticals Plc jumped 8 percent to $123.91. The maker of the narcolepsy treatment Xyrem said it will buy Gentium SpA, a rare-disease drug developer, in a deal valued at $1 billion. Gentium’s American depositary receipts added 2.8 percent to $57.22.

Textron Inc. rallied 14 percent to $37.29. The manufacturer of Cessna aircraft and Bell helicopters was near a $1.4 billion purchase of planemaker Beechcraft Corp. and an announcement could be made as soon as today, the Financial Times reported, citing unidentified people familiar with the matter. Dave Sylvestre, a spokesman for Textron, said the company had no comment on the newspaper’s report.

Allergan Inc. advanced 3.8 percent to $107.73. The maker of the Botox wrinkle treatment may be issued a patent for its Restasis eye drops as soon as January, Ken Cacciatore, an analyst with Cowen & Co., said in a note, citing legal consultants.

Ariad Pharmaceuticals Inc. rallied 16 percent to $6.43. The cancer-drug maker will return its only product, Iclusig, to the U.S. market after regulators approved a new prescribing and risk management plan.

BlackBerry Ltd. surged 16 percent, the most since April 2009, to $7.22. The struggling smartphone maker struck a five- year deal with Foxconn Group to manufacture its devices, following another quarterly plunge in sales and mounting losses.

The deal lets BlackBerry offload more of the costs of its unprofitable manufacturing operations, helping it focus on corporate software and services.

CarMax declined 9.4 percent to $48.08 for the biggest drop in the S&P 500. Third-quarter profit was 47 cents a share, trailing the average analyst estimate by 1 cent.

Fastenal Co. slumped 5 percent to $45.62. The retailer of nuts, bolts and other fasteners said it expects to miss analysts’ estimates for four-quarter earnings because of slower- than-expected sales growth.

Have a wonderful weekend everyone!!

Be magnificent!

“All successful people men and women are big dreamers. They imagine what their future could be, ideal in every respect, and then they work every day toward their distant vision, that goal or purpose.”
Brian Tracy

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