February 27, 2025, Newsletter

Dear Friends,

Tangents: Happy Friday Eve.
February 27, 1932: James Chadwick discovers the neutron, a fundamental particle in atomic nuclei, advancing the field of nuclear physics.
On Feb. 27, 1991, President George H.W. Bush declared that “Kuwait is liberated, Iraq’s army is defeated,” and announced that the allies would suspend combat operations at midnight. Go to article

Henry W. Longfellow, poet, b.1807.
Rudolph Steiner, philosopher, b.1861.
Elizabeht Taylor, actress, b.1932
Ralph Nader, advocate, b. 1934

Rare fresco discovered in Pompeii shows type of woman who ‘breaks free from male order to dance freely, go hunting and eat raw meat in the mountains’
Archaeologists have brought to light an enormous fresco depicting a secretive cult practice in Pompeii. Read More.

‘Utterly cataclysmic’: James Webb telescope spots 2 alien planets disintegrating before our eyes
In world-first observations, the James Webb Space Telescope is watching two distant alien planets “spilling their guts into space” as they rapidly disintegrate —
and scientists are elated at what they’ve found. Read More.

Chinese scientists reveal plans for near-invisible stealth missiles that could ‘redefine modern warfare’
Chinese scientists claim to have found a new way of injecting helium into rocket engines, which could be used to make missiles that are much harder to detect or intercept. The new technology was allegedly inspired by the faulty spacecraft that “stranded” NASA astronauts on the ISS last year. Read More.

Western travelers visit North Korea
CNN’s Will Ripley spoke to Western social media influencers who visited North Korea on recent trips. Here’s what they saw.

A high-stakes moon mission
A spacecraft built by Houston-based Intuitive Machines will soon attempt to land closer to the moon’s south pole than any vehicle has traveled before! Read about the mission.

Nvidia doubled profits in 2024. And its outlook is rosy despite AI jitters
Chipmaker Nvidia achieved stunning sales and profit growth as it closed out 2024. The company expects its sales to grow 65% year-over-year to $43 billion in the current quarter, exceeding analysts’ expectations.

The internet is raving about ‘nature’s Botox’
Many beauty enthusiasts have turned to ingredients you’d usually find in the food aisle as a way to hydrate the skin and reduce acne. But does it work?

Time is money
An Indian man was awarded damages in a legal case against the country’s biggest movie theater chain after he complained that it showed too many commercials before a movie.

Thieves target freight trains in California and Arizona deserts
More than $2 million worth of Nike sneakers were recently stolen in a string of freight train heists. Many of the shoes haven’t even hit the retail market yet.

PHOTOS OF THE DAY

Christchurch, New Zealand
Jacob Ryan, aka Yikes, puts the finishing touches on an 11-storey mural, part of Flare 2025, a street art festival. Nearly two dozen artists are taking part in the 11-day event
Photograph: PJ Heller/Zuma Press Wire/Rex/Shutterstock

A hopeful red fox hunts in a snowy field in Kars, Turkey
Photograph: Anadolu/Getty Images

Flamingoes feed at a beach in Kuwait City, Kuwait
Photograph: AFP/Getty Images
Market Closes for February 27, 2025

International Markets

Bonds

Currencies

Commodities

Market Commentary:
Who would you be and what would you do if you weren’t afraid? –David Brooks, b.1961.
Canada
By Bloomberg Automation
(Bloomberg) — The S&P/TSX Composite fell 0.8% at 25,128.24 in Toronto.
The index dropped to the lowest closing level since Jan. 17 after the previous session’s increase of 0.5%.
Royal Bank of Canada contributed the most to the index decline, decreasing 2.9%.
Energy Fuels Inc/Canada had the largest drop, falling 9.0%.
Today, 163 of 220 shares fell, while 56 rose; 9 of 11 sectors were lower, led by materials stocks.
Insights
* This month, the index fell 1.6%
* So far this week, the index was little changed
* The index advanced 18% in the past 52 weeks. The MSCI AC Americas Index gained 15% in the same period
* The S&P/TSX Composite is 2.9% below its 52-week high on Jan. 30, 2025 and 18.3% above its low on Feb. 28, 2024
* The S&P/TSX Composite is down 1.5% in the past 5 days and fell 0.6% in the past 30 days
* S&P/TSX Composite is trading at a price-to-earnings ratio of 20.9 on a trailing basis and 19 times estimated earnings of its members for the coming year
* The index’s dividend yield is 2.8% on a trailing 12-month basis
* S&P/TSX Composite’s members have a total market capitalization of C$4.09t
* 30-day price volatility rose to 11.09% compared with 10.80% in the previous session and the average of 11.00% over the past month
================================================================
| Index Points | |
Sector Name | Move | % Change | Adv/Dec
================================================================
Materials | -68.0747| -2.1| 6/43
Financials | -58.6517| -0.7| 10/15
Information Technology | -34.3806| -1.3| 1/9
Industrials | -26.3231| -0.8| 5/23
Utilities | -6.3633| -0.7| 4/10
Real Estate | -5.3077| -1.1| 2/18
Consumer Staples | -4.4833| -0.5| 2/8
Health Care | -0.7116| -1.0| 1/3
Consumer Discretionary | -0.4513| -0.1| 3/8
Communication Services | 0.1333| 0.0| 0/5
Energy | 4.4886| 0.1| 22/21
================================================================
| | |Volume VS| YTD
|Index Points | | 20D AVG | Change
Top Contributors | Move | % Change | (%) | (%)
================================================================
RBC | -48.6100| -2.9| 58.4| -3.9
Shopify | -21.0000| -1.5| -29.1| 4.6
Agnico Eagle Mines Ltd | -13.4300| -2.7| -0.2| 22.0
Enbridge | 5.1920| 0.6| -54.2| -1.2
Restaurant Brands | 6.1730| 3.0| 73.4| 0.5
TD Bank | 7.4770| 0.7| 26.9| 12.7
US
By Rita Nazareth
(Bloomberg) — A selloff in the stock market’s most-influential group drove the Nasdaq 100 to its lowest level since November as Nvidia Corp.’s results failed to revive the artificial-intelligence rally.
The S&P 500 fell 1.6%, erasing its gains for 2025.
Mega caps bore the brunt of the selling as good-but-not-great numbers from Nvidia Corp. disappointed investors.
The chipmaker sank 8.5%.
The dollar rose as Donald Trump said 25% tariffs on Canada and Mexico are on track to go into place March 4, and he’d impose an additional 10% tax on Chinese imports.
CTAs to Sell US Stocks in Every Scenario Again: Equity Insight
“Nvidia’s earnings were good, but they did not do a lot do lessen the growing fears that the earnings from the AI market will not be as strong as investors had been thinking,” said Matt Maley at Miller Tabak + Co.
“The quotes out of Washington, DC continue to create decent sized intraday moves in the markets.”
All the uneasiness around the actual impact of potential US tariffs on things like trade, the economy, inflation and even geopolitics kept Wall Street traders on their toes.
And there was no major relief from Thursday’s big batch of economic data released in the run-up to a key inflation reading.
The US economy advanced at a healthy pace and inflation was more stubborn than initially estimated at the end of 2024.
Gross domestic product increased at an unrevised 2.3% annualized pace in the fourth quarter.
The primary growth engine — consumer spending — advanced at a 4.2% pace.
“Investors want lower rates from the Fed, but they don’t want to get there by seeing a notable deterioration in the underlying economy,” said Bret Kenwell at eToro.
“At the very least, if the economy is going to slow, investors will want to see inflation slow down too.”
The Nasdaq 100 fell 2.8%.
The Dow Jones Industrial Average slid 0.45%.
A gauge of the Magnificent Seven mega caps sank 3%.
The Russell 2000 slipped 1.6%.
In late hours, Dell Technologies Inc. gave a bullish outlook.
The yield on 10-year Treasuries rose two basis points to 4.27%.
The Bloomberg Dollar Spot Index added 0.6%.
Pessimism among individual investors about the short-term outlook for stocks increased, according to the latest Sentiment Survey from the American Association of Individual Investors.
Bearish sentiment, expectations that stock prices will fall over the next six months, increased 20.2 percentage points to 60.6%.
Bullish sentiment dropped to 19.4% while neutral sentiment decreased to 20%, the AAII survey showed.
“AAII data on investor sentiment showed both an extremely high level of bearishness and a rapid increase in that metric,”
said Bespoke Investment Group strategists. “Historically, high levels of bearishness tend to lead to strong returns, but these
levels are unprecedented with stocks near recent highs.”
Bespoke also said that large spikes in bearishness during bull cycles have better precedent and more mixed implications for forward returns.
As some of the world’s largest companies report earnings, one topic is dominating the conversation: tariffs.
The topic has come up about 700 times during quarterly earnings calls for S&P 500 companies — a grouping of the world’s largest publicly traded businesses — according to a Bloomberg News analysis of transcripts.
That’s an all-time high in data going back to 2005 and slightly above the number seen in 2018, when President Trump first enacted tariffs.
“You do not only have uncertainty here in the United States, but you have a lot of uncertainty in terms of relationships with other countries, impact on markets,” said Dan Ivascyn at Pacific Investment Management Co.
“And that’s creating not only a lot of localized volatility but volatility across countries, across sectors, across yield curves and that’s a great opportunity as well.”
Ivascyn thinks the key theme going into this year is to have a “healthy degree of humility around the uncertainty”.
“Acknowledge the uncertainty, but look to take advantage of the full global opportunity set, both within the liquid higher quality areas of the market, as well as in some of the more credit sensitive areas as well,” he noted.
US Inflation, Spending Data to Show January Chill – Nowcasts
Traders also geared up for the Federal Reserve’s preferred inflation metric, which is expected to cool to the slowest pace since June, but glacial progress on taming price pressures overall will keep policymakers cautious about lowering interest rates further.
The core personal consumption expenditures price index — which excludes often-volatile food and energy costs — probably rose 2.6% in the year through January in Commerce Department data due on Friday.
Overall PCE inflation likely eased on an annual basis as well, according to the median estimate in a Bloomberg survey of economists.
“Indications that price pressures may be catching a second wind even before the potential impact of additional tariffs should send a cautionary message about the near-term inflation outlook,” said Jim Baird at Plante Moran Financial Advisors.

Corporate Highlights:
* Tesla Inc. is seeking approval to offer ride-hailing services in California, a key step by Elon Musk’s company to begin carrying paying customers while its traditional car-selling business falters.
* Apollo Global Management Inc. is in talks to lead a roughly $35 billion financing package for Meta Platforms Inc. to help develop data centers in the US, according to people with knowledge of the matter.
* Amazon.com Inc.’s cloud unit has built its first quantum- computing chip, joining a growing roster of technology companies showing off futuristic hardware.
* B. Riley Financial Inc. lined up new funding to replace Nomura Holdings Inc., erasing what’s left of a loan tied to an ill- fated buyout deal that has hobbled the brokerage and investment firm.
* Walgreens Boots Alliance Inc. rose after a report that a potential take-private deal from Sycamore Partners would lead to a breakup of the drugstore chain.
* Peanut butter and jelly maker JM Smucker Co. increased full- year profit guidance, offering a view that’s more optimistic than what Wall Street anticipated.
* Snowflake Inc. projected better-than-expected revenue growth for the fiscal year, sending an optimistic signal about the adoption of its recently launched products for artificial intelligence.
* Toronto-Dominion Bank beat estimates on better-than-expected wealth-management and capital-markets results, capping off an earnings season that saw all of Canada’s big banks benefit from higher trading activity.
* Royal Bank of Canada beat estimates on higher results in its capital-markets and wealth-management divisions as both units benefited from strong markets.
* Canadian Imperial Bank of Commerce came ahead of analyst expectations with gains across all segments, particularly with strength in the capital markets business.
* Elliott Investment Management is ramping up pressure on BP Plc after its new strategy fell short of the activist investor’s expectations, people with knowledge of the matter said.

Key events this week:
* Japan Tokyo CPI, industrial production, retail sales, Friday
* US PCE inflation, income and spending, Friday
* Fed’s Austan Goolsbee speaks, Friday

Some of the main moves in markets:
Stocks
* The S&P 500 fell 1.6% as of 4 p.m. New York time
* The Nasdaq 100 fell 2.8%
* The Dow Jones Industrial Average fell 0.45%
* The MSCI World Index fell 1.4%
* Bloomberg Magnificent 7 Total Return Index fell 3%
* The Russell 2000 Index fell 1.6%
Currencies
* The Bloomberg Dollar Spot Index rose 0.6%
* The euro fell 0.8% to $1.0403
* The British pound fell 0.5% to $1.2608
* The Japanese yen fell 0.4% to 149.71 per dollar
Cryptocurrencies
* Bitcoin fell 1.3% to $83,386.43
* Ether fell 3.7% to $2,254.21
Bonds
* The yield on 10-year Treasuries advanced two basis points to 4.27%
* Germany’s 10-year yield declined two basis points to 2.41%
* Britain’s 10-year yield advanced one basis point to 4.51%
Commodities
* West Texas Intermediate crude rose 2.2% to $70.16 a barrel
* Spot gold fell 1.5% to $2,873.85 an ounce

This story was produced with the assistance of Bloomberg Automation.
–With assistance from Isabelle Lee, Margaryta Kirakosian, John Viljoen and Divya Patil.

Have a lovely evening everyone.

Be magnificent!
As ever,

Carolann
You can’t go back and change the beginning, but you can start where you are and change the ending. –C.S. Lewis, 1898-1965.

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 (Text Only)
Toll Free: 1.877.430.5895
Fax: 778.430.5828
www.carolannsteinhoff.com