December 7, 2018 Newsletter

Dear Friends,

Tangents:  Happy Friday!

1941~ Japanese attack Pearl Harbour.

ICYMI
A special World War II spy

You may have read that the Bank of England is looking for a new face for its 50-pound note (worth about $65).

There have been many suggestions: the former prime minister Margaret Thatcher, the mathematician Alan Turing and the physicist Stephen Hawking.

Noor Inayat Khan in an undated photograph.  Hidayat Inayat-Khan, via Soefi Museum

One lesser-known name caught our attention: Noor Inayat Khan, who spied for Britain during World War II.

Ms. Khan wasn’t what one would expect of a British spy. She was born a princess to Indian royalty, and she was a musician and a writer. But she spoke French and had excellent radio skills. She became the first female radio operator sent by Britain into occupied France.

She did the work of six radio operators, moving constantly and dyeing her hair blond to avoid detection. Her work became crucial to the war effort.

Ms. Khan never made it home; she was captured and executed at the Dachau concentration camp in 1944. She was 30.

Read more about her here. –The New York Times, December 7, 2018.

PHOTOS OF THE DAY

A rare orphaned wildcat kitten has been rescued after it preyed upon an Aberdeenshire farmer’s chickens to survive, Scotland, UK. Credit Steve Piper

Hikers walk along the Skaftafellsjokul Glacier in Southern Iceland. Credit: Owen Humphreys/PA Wire

Pictures have revealed the extraordinary trails stars make in the night sky as the earth rotates. The surreal-looking circular patterns in the sky above a lighthouse, windmill and statues. Other spectacular shots show the stars blazing their way past a wooden lodge, above a church during the aurora and streaming around a forest. The remarkable photographs were taken in Ukraine, Nepal and Iceland by travel photograph Yehven Samuchenko from Odessa, Ukraine. Credit: Mediadumimages/Yehven Samuchenko
Market Closes for December 7^th, 2018

International Markets

Bonds

Currencies

Commodities

Market Commentary:
On this day in 1999, Yahoo was added to the S&P 500, sending the stock surging 32% in a single week.
Canada
By Michael Bellusci
     (Bloomberg) — Canadian stocks ended lower Friday with the S&P/Toronto Stock Exchange Composite Index down just under 1 percent. The index lost 2.65 percent this week. Consumer discretionary and information technology led Friday’s decline.
     In the U.S., the S&P 500 fell 2.3% to cap worst week since March.
     The Cannabis sector climbed Friday morning after Altria Group Inc. agreed to buy a minority stake in Cronos Group Inc., the fourth-largest Canadian cannabis producer by market value. Pot stocks had been poised for their worst weekly loss in six weeks as of Thursday’s close.
     Energy stocks lost a bit of their early rally, despite OPEC agreeing to a larger than expected production cut. The S&P/TSX energy index ended the day up 0.1 percent.
     Huawei Technologies Co. was back on the radar after a lawyer representing Canada said during a bail hearing earlier today that Chief Financial Officer Meng Wanzhou is being prosecuted for fraud.
Stocks
* DiaMedica Therapeutics dropped 50% after its IPO
* Cardinal Energy fell 8.1% after cutting its dividend 
* Shopify fell 6.9% 
* National Access Cannabis surged 16.7% after its sales and corporate update
* Cronos Group gained 22% after a deal with Altria Group 
Commodities
* Western Canada Select crude oil traded at a $15 discount to WTI
* Gold gained 0.7 percent to $1,246.80 an ounce
FX/Bonds
* The Canadian dollar fell 0.5 percent to C$1.33 per U.S. dollar
* The Canada 10-year government bond yield fell 2 basis points to 2.07%
US
By Vildana Hajric and Sarah Ponczek
     (Bloomberg) — U.S. stocks plunged, with technology shares again bearing the worst of the selling as the Trump administration pressed its trade war with China and the latest batch of economic data added to concern that growth has peaked.
     Oil surged after OPEC agreed to cut output. The S&P 500 tumbled more than 50 points and is on course for a weekly rout of 4.4 percent, which would be the worse on a closing basis since March. Stocks fell to session lows after breaching the 2,650 level that had stopped earlier declines.
     Trade remained in focus, with investors monitoring a court appearance by a Huawei executive whose arrest was seen as a blow to the China-U.S. trade truce. The Federal Reserve’s Lael Brainard struck a hawkish tone in comments at a conference.
     Netflix, Amazon and Alphabet sank at least 2.5 percent to lead losses among megacap tech shares.Nvidia and Advanced Micro Devise tumbled more than 6 percent as chipmakers cratered.Energy shares were the only S&P 500 group to rise after the OPEC deal. Interest-rate futures put the probability of a Federal Reserve rate increase at its Dec. 18-19 meeting above 70 percent
     Stocks had opened higher after the November jobs report showed moderation in the labor market, giving succor to proponents for a slower pace of Fed interest-rate increases. Treasuries fluctuated on the data before settling higher as risk aversion increased. The dollar remained lower.
     “After coming off craziness yesterday, it’s really a time to look ahead,” said Joe “JJ” Kinahan, chief market strategist at TD Ameritrade. “I still fear the last half hour or so only because any weakness in the last half hour and you could see some selling into the close as people want to take off risk into the weekend.”
     U.S. payrolls and wages rose by less than forecast in November while the unemployment rate held at the lowest in almost five decades. The report comes with financial markets on edge over whether Fed Chair Jerome Powell is closer to pausing.
     Market-implied U.S. rate expectations have been sinking amid the tumult in equities, but hawkish views still exist among Fed officials, including Powell. He delivered a bullish assessment of the U.S. economy and the job market Thursday night.
     “It was a Goldilocks report,” said Alec Young, managing director of global markets research at FTSE Russell. “Weak enough to convince investors the Fed can slow their tightening, but strong enough not to get people more worried about a recession.”
     Away from jobs and rates, markets have are closely watching developments in the U.S. trade war with China. Trump tweeted Friday that talks are “going very well,” though he supplied no details.
     In Europe, stocks rebounded from the worst day in more than two years, while Asian shares posted modest gains as investors sought to end a bruising week on a more upbeat note. Italian debt climbed as European bonds largely drifted. The pound was steady as U.K. Prime Minister Theresa May was said to be weighing a plan to postpone the vote on her Brexit deal.
     Oil rallied after OPEC broke an impasse over production curbs, agreeing on a larger-than-expected cut with allies after two days of fractious negotiations in Vienna. The cartel and its partners agreed to remove 1.2 million barrels a day from the market, with OPEC itself shouldering 800,000 barrels of the burden. Cryptocurrencies continued their slide with a fresh bout of losses after U.S. regulators dashed hopes that a Bitcoin exchange-traded fund would appear before the end of this year.
These are the main moves in markets:
Stocks
* The S&P 500 fell 2.2 percent as of 2:04 p.m. in New York, while the Dow Jones Industrial Average slumped 2.2 percent and the Nasdaq Composite Index erased 2.7 percent.
* The Stoxx Europe 600 rose 0.8 percent. 
* The U.K.’s FTSE 100 rallied 1.4 percent.
* Germany’s DAX Index gained less than 0.1 percent.
* The MSCI Emerging Market Index climbed 0.4 percent.
* The MSCI Asia Pacific Index increased 0.2 percent.
Currencies
* The Bloomberg Dollar Spot Index fell 0.1 percent. 
* The euro gained 0.2 percent to $1.1392.
* The British pound weakened less than 0.2 percent to $1.2751.
* The Japanese yen gained less than 0.1 percent to 112.65 per dollar.
Bonds
* The yield on benchmark 10-year Treasuries dropped one basis point to 2.88 percent. The three-year note yield fell one basis point to 2.75 percent as the yield on the five-year note dropped two basis points to 2.73 percent.
* Germany’s 10-year yield rose two basis points to 0.25 percent.
Commodities
* West Texas Intermediate crude jumped 4.2 percent to $53.63 a barrel. 
* Gold rose 0.7 percent at $1,246 an ounce.
* LME copper climbed 1.1 percent to $6,136 per metric ton, the first increase in four days.

Have a wonderful weekend.

Be magnificent!

As ever,

Carolann

Life is what happens to you while you’re busy making other plans.
                                                 -John W. Lennon, 1940-1980

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