February 25, 2019 Newsletter

Dear Friends,

Tangents:
On February 25, 1570 – Pope Pius V excommunicated England’s Queen Elizabeth I. Go to article >>

1841- Auguste Renoir, painter, was born.
1943, George Harrison, musician, was born.
1964 – Cassius Clay (Muhammad Ali), becomes heavyweight champion.

POINTS OF PROGRESS:
AUSTRALIA
Melbourne has become the first Australian city to power all city infrastructure with renewable energy sources.  The facilities include streetlights, libraries, gyms, and childcare centers.  While some residents were concerned about the expense of the transition, the city has been able to come out on top of costs by leveraging the savings from increased energy efficiency.  Other cities in Australia, such as Victoria, are also making great strides on hitting clean energy targets.  –The Guardian.

UNITED STATES
January storms have refilled California’s reservoirs.  While heavy rains can cause mudslides in fire-stricken areas, they also restore water supplies in a  state that often faces drought conditions.  This winter’s rainfall has ensured that the state’s reservoirs and lakes – as well as the Sierra Nevada snowpack – are off to an above-average start this year. -Los Angeles Times.
PHOTOS OF THE DAY

Revellers wearing masks and period costumes take part in the Venice Carnival. Credit: Alberto Pizzoli/AFP/Getty Images

A reveller in costume attends the “Cordao do Boitata” street party in Rio de Janeiro, Brazil. Credit: Leo Correa/AP

Russia’s Viachelslav Barkov soars through the air during the Nordic Combined, Ski Jumping Team Sprint HS130 event, at the Nordic Ski World Championships in Innsbruck, Austria. Credit: Matthias Schrader/AP
Market Closes for February 25^th, 2019

International Markets

Bonds

Currencies

Commodities

Market Commentary:
On this day in 1862, Abraham Lincoln signed the Legal Tender Act, putting the U.S. government in the business of printing paper money. Previously, most money had been printed privately by local banks. The act also authorized the Treasury to sell 6% bonds callable in five years, maturing in 20, which were quickly nicknamed “5-20s.” Philadelphia broker Jay Cooke invented what he called the “democratic distribution” of investments, slicing the 5-20s into denominations as small as $50, advertising them heavily in local newspapers, and hiring his own army of 2,500 “traveling agents” to sell them in towns throughout the Union. He raised $361 million in less than two years—and introduced tens of thousands of Americans to investing for the first time.
Canada
By Michael Bellusci
     (Bloomberg) — Canadian stocks advanced Monday, following early gains in global stocks after U.S. President Donald Trump postponed the date for boosting tariffs on Chinese imports, taken as a sign of progress in the trade talks.
     The S&P/TSX Composite Index rose 0.3 percent to 16,057.03, its highest closing level since October 3. Industrial companies, financials, and communication services outperformed while health care dropped.
     Oil tumbled the most in four weeks after Trump tweeted that prices are too high and called on OPEC to “relax and take it easy.”
     Meanwhile, Barrick Gold Corp. is going hostile in its bid to acquire Newmont Mining Corp. and create the world’s largest gold producer, offering $17.8 billion for the company in an all- share deal. Shares of both companies fell.
In other moves:
Stocks
* Cannex Capital Holdings Inc. gained 13 percent after reporting a pact to acquire California-based Pure Ratios 
* Trulieve Cannabis Corp. rose 11 percent to its highest since early October 
* SNC-Lavalin Group Inc. jumped 6.3 percent, most since Jan. 29
* Chemesis International Inc. fell a record 18 percent after announcing a C$5.8 million equity financing
* Village Farms International Inc. lost 7.6 percent 
Commodities
* Western Canada Select crude oil traded at a $13.50 discount to WTI
* Gold fell less than 0.3 percent to $1,325.90 an ounce
FX/Bonds
* The Canadian dollar weakened 0.4 percent to C$1.31752 per U.S.dollar
* The Canada 10-year government bond yield rose to 1.896 percent
US
By Sarah Ponczek and Reade Pickert
     (Bloomberg) — U.S. equities managed to hold on to early gains and close at the highest levels in almost four months after President Donald Trump postponed the date for boosting tariffs on Chinese imports, taken as a sign of progress in the trade talks. Bonds yields rose and oil retreated.
     After reaching session highs early in the trading day, the S&P 500 drifted lower amid a slide in utilities, real estate and consumer staples, before closing in the green. European and Asia stocks rallied earlier. General Electric shares soared after the company agreed to sell its bio-pharma business for a total consideration of $21.4 billion.
     In Asia, the Shanghai Stock Exchange Composite Index rallied the most since 2015 and the yuan strengthened after Trump said he will delay the March 1 trade deadline, and as comments from China President Xi Jinping suggested top officials will focus on growth rather than cracking down on leverage.
     Emerging-market currencies and shares advanced despite China’s state-run Xinhua news agency later publishing a commentary saying talks will be harder at the final stage.
     “The reality is there was enough pain created that caused both the Trump administration and President Xi and his administration basically to say, ‘we have to come to an agreement,”’ said Nathan Thooft, Manulife Asset Management’s head of global asset allocation. “There’s no doubt the interaction and the fact that they’re actually speaking and seem to be progressing is being viewed as a positive in the market.”
     The official delay from the U.S. may give fresh impetus to extend a global rally in equities that was being tested amid an uncertain future on global trade and forecasts for global economic growth to ebb. Also in focus this week will be a hearing from Federal Reserve Chairman Jerome Powell, where investors will get the latest read on monetary policy.
     Trump said the trade talks were productive. “The U.S. has made substantial progress in our trade talks with China on important structural issues including intellectual property protection, technology transfer, agriculture, services, currency, and many other issues,” he said in a Twitter posting on Sunday evening.
     Read how emerging markets are beholden to the yuan’s fate as trade deadline looms
     Elsewhere, crude oil fell after Trump said in a tweet that prices were too high, while copper held on to gains over Chinese optimism. Gold was little changed, with Newmont Mining climbing on a hostile bid from rival Barrick Gold. The pound was little changed versus the euro as U.K. Prime Minister Theresa May pushed back the deadline for Parliament to vote on her Brexit deal.
Here are some key events coming up:
* Fed Chairman Jerome Powell delivers semiannual testimony on monetary policy and the state of the economy over two days to House and Senate committees. 
* U.K. Prime Minister Theresa May updates the House of Commons on Brexit talks as the March 29 deadline nears for Britain to leave the EU. Lawmakers will vote on Feb. 27.
* President Donald Trump and North Korea leader Kim Jong Un are expected to meet for a second summit beginning on Tuesday.
* Thursday brings fourth quarter U.S. GDP.
These are the main moves in markets:
Stocks
* The S&P 500 Index rose 0.1 percent as of 4:05 p.m. New York time, while the Nasdaq Composite Index added 0.4 percent and the Dow Jones Industrial Average gained 0.2 percent.
* The Stoxx Europe 600 rose 0.3 percent, reaching the highest level in almost 20 weeks.
* The MSCI Emerging Market Index rose 0.9 percent, the sixth straight increase.
* The MSCI Asia Pacific Index gained 0.8 percent, hitting the highest in more than 20 weeks with its sixth straight advance. 
Currencies
* The Bloomberg Dollar Spot Index fell less than 0.1 percent, after reaching the lowest level in almost three weeks.
* The euro gained 0.2 percent to $1.1362.
* The British pound strengthened 0.4 percent to $1.3102.
* The MSCI Emerging Markets Currency Index rose 0.4 percent, touching the highest in more than three weeks.
Bonds
* The yield on 10-year Treasuries climbed two basis points to 2.67 percent.
* Germany’s 10-year yield rose one basis point to 0.11 percent.
* Britain’s 10-year yield increased two basis points to 1.18 percent. 
Commodities
* West Texas Intermediate fell 3.4 percent to $55.34 a barrel, the first drop in nine sessions.
* Gold dropped less than 0.1 percent to $1,328 an ounce.
* The Bloomberg Commodity Index declined 1 percent, the first retreat in more than a week.

Have a great night.

Be magnificent!

As ever,

Carolann

When one door of happiness closes, another opens; but often we look so long
at the closed door that we do not see the one which has opened for us.
-Helen Keller, 1880-1968

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