December 3, 2018 Newsletter

Dear Friends,

Tangents:  Happy Hanukkah to all who are celebrating!

1891 – Basketball created
1935 – Woody Allen b.
1940, Richard Pryor b.
1945 – Bette Midler b.
1955 – Rosa Parks arrested.
1967 Surgeons in Cape Town, South Africa, led by Dr. Christiaan Barnard performed the first human heart transplant.

How to make God laugh: Tell Him your future plans. -Woody Allen

UNUSUAL VEGETABLE SOURCE:
Those behind La Caverne got creative when they discovered there was an unused parking garage in Paris – they decided to set up an urban farm.  La Caverne grows, mushrooms, endives, and microgreens.  Check out www.instagram.com/lacavern_urbanfarm to see the farmers at work and some of the products that are being grown where cars were once parked.

A celebrity wedding venue in India

The actress Priyanka Chopra and the singer Nick Jonas tied the knot this weekend in the northern Indian city of Jodhpur (where your Back Story writer was born).

Among the many dazzling details of the closely watched wedding was the venue: the Umaid Bhawan Palace.

The Umaid Bhawan Palace, in northern India.  Strdel/Agence France-Presse — Getty Images 

Named after one of Jodhpur’s kings, Maharajah Umaid Singh, the grandiose sandstone structure took 15 years to build and was completed in 1943. Peacocks strut around its surrounding manicured gardens. Intricately carved pillars hold up its dome.

But perhaps most remarkable is its noble origin story. It is said that the palace was built as a mass relief program, employing thousands of local residents when the city was hit by a crippling drought.

After the Indian government ceased to recognize Indian royalty in 1971, the palace was split into three parts: the royal residence where Mr. Singh’s grandson now lives, a luxury hotel and a museum. From The New York Times, December 3, 2018

PHOTOS OF THE DAY

A local fisherman sit atop stilts as they wait to catch fish in Ahangama, Sri Lanka. Credit: Buddhika Weerasinghe/Getty Images

Fire breather Rob Sim demonstrates his art as part of a weekend of festivities in Victorian theme at the former residence of Queen Victoria at Osborne House, Isle of Wight. Credit: Russell Sach for The Telegraph

People dressed as Santa Claus take part in the 9^th edition of the Santa Claus ‘Papa Noel’ rally in Turin, Italy. Credit: Marco Bertorello/AFP/Getty Images
Market Closes for December 3^rd, 2018

International Markets

Bonds

Currencies

Commodities

Market Commentary:
Microsoft eclipsed Apple as the largest U.S. company by market value for the first time since 2003. Microsoft closed Friday with a market cap of $851.36 billion, nearly $4 billion higher than the iPhone maker.
On this day in 1777, the U.S. borrowed money from a foreign government for the first time. The Continental Congress authorized Benjamin Franklin and Silas Deane, the American commissioners to France, to obtain a loan of 2 million pounds from the French monarchy.
Canada
By Janine Wolf
     (Bloomberg) — Canadian stocks opened mostly higher Monday, with the S&P/Toronto Stock Exchange Composite Index gaining 0.4 percent. Energy and materials stocks led the rise, while health care stocks were among the biggest decliners.
     The energy sector advanced 1.7 percent as of 10:27 a.m. in Toronto, with 83 percent of its members gaining. Large cap oil producers, including Canadian Natural Resources and Cenovus Energy, are poised to benefit from Alberta ordering an unprecedented output cut. On the downside, the news is seen as a negative for those with downstream operations including Suncor Energy, according to analysts.
     Pot stocks led among the decliners, after Aphria Inc., one of Canada’s biggest cannabis companies, was attacked as a short call by Quintessential Capital Management founder Gabriel Grego. In a conference in New York on Monday, he said the company has diverted about half of its net assets into inflated investments held by insiders. He added that Aphria is a “black hole,” according to a report he ran in conjunction with Hindenburg Research, a forensic analysis firm based in New York.
Stocks
* Energy companies jump on Alberta’s output cut order:
** Canadian Natural Resources gained as much as 16 percent, its biggest intraday gain in 10 years
** Crescent Point Energy gains 10 percent
** Whitecap Resources climbs 16 percent, biggest gain in 8 years
** Tamarack Valley Energy gains 11 percent, most since December
** Cenovus Energy gains as much as 13 percent in biggest intraday gain on record
* Aphria Inc. plummeted 27.5 percent on being called a “black hole” by the short-seller who targeted Folli Follie
** Aurora Cannabis Inc., Canopy Growth also traded lower
Commodities
* Western Canada Select crude oil traded at a $31.90 discount to WTI
* Gold rose 0.9 percent to $1,231.10 an ounce
FX/Bonds
* The Canadian dollar gained 0.9 percent to C$1.31804 per U.S. dollar
* The Canada 10-year government bond yield rose 1.4 basis points to 2.228 percent
US
By Sarah Ponczek and Vildana Hajric
     (Bloomberg) — Stocks rallied after the U.S. and China declared a truce in their trade war, while the dollar weakened and oil gained. A portion of the U.S. yield curve inverted for the first time in more than a decade.
     The benchmark S&P 500 Index jumped more than 1 percent, building on gains posted during the biggest weekly increase in almost seven years, after leaders of the two countries agreed to hold off on new tariffs and intensify trade talks. European and Asian shares closed higher. The difference between three- and five-year Treasury yields dropped below zero, in what could be the first signal that the market is putting the Federal Reserve on notice that the end of its tightening cycle is approaching.
     Major movers in U.S. stocks: Exxon Mobile, Halliburton and Kinder Morgan led a rise in energy shares, the best performing section in the S&P 500  PepsiCo and Coca-Cola helped weigh down consumer staples “The very positive reaction from stock means that for the time being, investors have put behind them the concern that the tariff war might escalate,” said Donald Selkin, chief market strategist at Newbridge Securities. “On the other hand, there are issues out there which could cause a cooling off of the current optimism.”
     Oil was jolted higher by efforts across the globe to support prices as Saudi Arabia and Russia extended their pact to manage the market and Canada’s largest producing province ordered unprecedented supply cuts. Optimism was dented slightly after Qatar said it was leaving OPEC, just as the group prepares to meet this week.
     The truce between President Donald Trump and President Xi Jinping at the Group of 20 summit in Argentina has gone some way in calming investor fears over the state of global growth after a tumultuous period for risk assets. The U.S. had been scheduled to push ahead on Jan. 1 with increased tariffs on $200 billion worth of Chinese goods. Going forward, investors will assess the prospects for an end-of-year equity rally, while oil traders will continue to focus on any OPEC-related headlines to gauge the likely scale of production cuts.
     “It’s easy to see the trade deal as a half empty — that it’s just a postponement and that they’ll work together but that there really isn’t any kind of resolution,” said Jeff Kleintop, chief global investment strategist at Schwab Center for Financial Research. “But I think you can see it as a half glass full. ”
     Elsewhere, the pound erased a gain as the threat of a vote to bring down British Prime Minister Theresa May’s government looms should Parliament reject her Brexit deal. That raises the stakes even further as lawmakers begin debating her plan this week. China’s yuan climbed with emerging market assets. Gold and copper rallied, as did most other commodities.
Coming Up
* U.S. financial markets are set to close Wednesday for a national day of mourning to honor former President George H.W. Bush. 
* Federal Reserve Chairman Jerome Powell’s testimony to Congress scheduled for Wednesday has been canceled.
* China November trade data is due on Saturday.
These are the main moves in markets:
Stocks
* The S&P 500 gained 1.1 percent to 2,790.36 as of 4:02 p.m. in New York, while the Dow Jones Industrial Average increased 1.1 percent to 25,826.43 and the Nasdaq Composite Index rose 1.5 percent to 7,441.51.
* The Stoxx Europe 600 rose 1 percent. 
* The U.K.’s FTSE 100 rallied 1.2 percent.
* Germany’s DAX Index gained 1.9 percent.
* The MSCI Emerging Market Index climbed 2.2 percent.
* The MSCI Asia Pacific Index increased 2 percent.
Currencies
* The Bloomberg Dollar Spot Index fell 0.2 percent. 
* The euro gained 0.2 percent to $1.1342.
* The British pound weakened less than 0.1 percent to $1.2723.
* The Japanese yen weakened less than 0.1 percent to 113.65 per dollar.
Bonds
* The yield on benchmark 10-year Treasuries fell less than one basis point to 2.98 percent. The three-year note yield increased four basis points to 2.84 percent as the yield on the five-year note rose two basis points to 2.83 percent.
* Germany’s 10-year yield fell less than one basis point to 0.31 percent.
Commodities
* West Texas Intermediate crude jumped 4.4 percent to $53.19 a barrel. 
* Gold rose. 0.7 percent at $1,230.62 an ounce, after reaching the highest in a month.
* LME copper climbed 1.6 percent to $6,295 per metric ton, after reaching the highest in almost 10 weeks on the biggest increase in a month. 
–With assistance from Katherine Greifeld.

Have a great night.

Be magnificent!

As ever,

Carolann

If you can’t feed a hundred people, then feed just one.
                           -Mother Teresa, 1910-1997

Carolann Steinhoff, B.Sc., CFP®, CIM, CIWM
Senior Investment Advisor

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

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