February 28,2025 Newsletter

Dear Friends,

Tangents: Happy Friday.

February 28, 1972 President Richard M. Nixon and Chinese Premier Chou En-lai issued the Shanghai Communique at the conclusion of Nixon’s historic visit to China, a step toward the eventual normalization of relations between the two countries.  Go to article
February 28, 1986: Olaf Palme, Prime Minister of Sweden, assassinated.
February 28, 2013: researchers at Duke University successfully connect the brains of two rats, allowing direct sharing of information, a pioneering step in brain-to-brain communication.

Mystery of how man’s brain turned to glass after Vesuvius eruption possibly solved
The new study on the “glass brain” from Herculaneum is the latest episode in a long-running academic dispute. Read More.

Next ice age would hit Earth in 11,000 years if it weren’t for climate change, scientists say
Scientists have determined exactly how Earth’s orbit and tilt affect glaciation and deglaciation, based on the length of these parameters’ cycles and clues hidden at the bottom of the ocean. Read More.

‘It’s extremely worrisome’: NASA’s James Webb Space Telescope faces potential 20% budget cut just 4 years after launch
Such a dramatic cut to a flagship space telescope still in its prime will be felt across the mission’s entire operations, affecting science. Read More.

New ‘Ocelot’ quantum processor inspired by Schrödinger’s cat could scale up quantum computers by massively slashing errors
AWS’s first-ever quantum chip uses “cat qubits” to reduce errors exponentially as more qubits are added to a system. Scientists say it will lead to scalable and efficient quantum computers. Read More.

Most powerful cosmic rays in the universe start shockingly close to Earth, paper claims
The most powerful cosmic rays in the universe currently have no explanation. New research suggests that exotic, self-annihilating particles in our own galaxy may hold the answer. Read More.

CNN looks back on Gene Hackman’s life and work
Oscar-winning actor Gene Hackman and his wife were found dead in their home Wednesday under “suspicious” circumstances. Watch this video to learn about his life and legacy.

When does Ramadan officially start?
Roughly a quarter of the world’s population is expected to head into Ramadan this weekend but the official start time could vary. Learn more about the Islamic holy month.

The world’s smallest park is the size of four pieces of paper
A park in Japan, roughly the size of four sheets of A4 paper, was recently crowned the world’s smallest! See a photo here.

Oldest known Holocaust survivor dies at age 113
Rose Girone, the oldest known Holocaust survivor who endured both German and Japanese oppression but lived for eight decades beyond the end of World War II, has died at age 113.

A new poll indicates that some Americans feel buyer’s remorse about voting for President Donald Trump.
On Thursday’s “Late Show,” Stephen Colbert pointed out that it’s mainly because, after more than a month in office, Trump has yet to eliminate inflation, as he promised during his campaign to do on Day 1.
“That was his claim. He said it over and over again, and now, on Day 38, they still think things are too expensive. Somewhere in Delaware, Joe Biden is shaking his head, chuckling to himself, and thinking, ‘Why did I come into this room?’ ” — STEPHEN COLBERT

“It’s getting so expensive — this is true — that here in New York, some bodegas are selling individual eggs, known as ‘loosie’ eggs, to customers who can’t afford full cartons. Yum, loose egg! And if you can’t afford those, there’s a guy in the alley in the back.” — STEPHEN COLBERT
PHOTOS OF THE DAY

São Paulo, Brazil
Nur, the first polar bear cub born in Latin America, walks towards her mother, Aurora, at the São Paulo aquarium.
Photograph: Isaac Fontana/EPA

Volcanic eruption on the Reykjanes peninsula – Svartsengi, Reykjanes, Iceland
Gold in the nature photojournalism category
Photograph: Ael Kermarec/World Nature Photography awards

​​​​​​​Hyalite Lake – Montana, US
Gold in the planet earth’s landscapes and environments category
Photograph: Jake Mosher/World Nature Photography awards
Market Closes for February 28, 2025

International Markets

Bonds

Currencies

Commodities

Market Commentary:
Money is usually attracted, not pursued. –Jim Rohn, 1930-2009.
Canada
By Bloomberg Automation
(Bloomberg) — The S&P/TSX Composite rose 1.1% at 25,393.45 in Toronto.
The move was the biggest gain since Feb. 5 and follows the previous session’s decrease of 0.8%.
Royal Bank of Canada contributed the most to the index gain, increasing 2.7%.
Pembina Pipeline Corp. had the largest increase, rising 7.1%.
Today, 138 of 220 shares rose, while 76 fell; 9 of 11 sectors were higher, led by financials stocks.
Insights
* In the past year, the index had a similar or greater gain 15 times. The next day, it advanced nine times for an average 0.3% and declined six times for an average 0.6%
* This month, the index fell 0.5%
* So far this week, the index rose 1%, heading for the biggest advance since the week ended Jan. 24
* The index advanced 19% in the past 52 weeks. The MSCI AC Americas Index gained 16% in the same period
* The S&P/TSX Composite is 1.9% below its 52-week high on Jan. 30, 2025 and 19.3% above its low on Feb. 29, 2024
* S&P/TSX Composite is trading at a price-to-earnings ratio of 18.8 on a trailing basis and 15.3 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$4.06t
* 30-day price volatility rose to 11.22% compared with 11.09% in the previous session and the average of 10.99% over the past month
================================================================
| Index Points | |
Sector Name | Move | % Change | Adv/Dec
================================================================
Financials | 106.6072| 1.3| 19/4
Energy | 52.5839| 1.3| 24/18
Industrials | 51.2413| 1.6| 19/9
Materials | 18.6187| 0.6| 28/18
Information Technology | 15.1760| 0.6| 3/7
Consumer Staples | 10.9071| 1.2| 4/6
Utilities | 9.0775| 1.0| 15/0
Consumer Discretionary | 2.4783| 0.3| 7/4
Real Estate | 1.5472| 0.3| 17/3
Health Care | -0.4178| -0.6| 1/3
Communication Services | -2.6215| -0.4| 1/4
================================================================
| | |Volume VS| YTD
|Index Points | | 20D AVG | Change
Top Contributors | Move | % Change | (%) | (%)
================================================================
RBC | 44.2500| 2.7| 14.2| -1.4
Enbridge | 23.5200| 2.6| 28.9| 1.3
Shopify | 16.7500| 1.2| 29.6| 5.9
Stella-Jones | -1.2610| -4.4| 98.5| -2.8
BCE | -2.3030| -1.1| -38.9| 0.3
CGI Inc | -13.3200| -5.9| 303.7| -4.6
US
By Rita Nazareth, Isabelle Lee, Emily Graffeo and Vildana Hajric
(Bloomberg) — Stocks shook off another bout of volatility spurred by geopolitical anxiety and a White House shouting match to rally at the end of a jittery February.
Equities rebounded after being hit with several twists and turns.
Plans to sign a minerals deal between the US and Ukraine were scrapped as Donald Trump’s meeting with Volodymyr Zelenskiy devolved into a fiery exchange.
Trump later said Zelenskiy can come back when he’s ready for peace.
Meantime, Treasury Secretary Scott Bessent said Mexico has proposed matching US tariffs on China and urged Canada to do the same, signaling a potential path to avert levies.
Wall Street traders have seen a rise in equity swings amid a set of risks ranging from an economic slowdown, geopolitics, a trade war and artificial-intelligence valuations.
“We think the bull market is intact,” said David Lefkowitz at UBS Global Wealth Management. “But we have also cautioned that volatility would likely be higher this year. Therefore, we have been highlighting that short-term hedges may be worth considering.”
To Jay Hatfield at Infrastructure Capital Advisors, while the market was rattled by the US-Ukraine headlines, the indication is that Trump will force peace – which is positive.
To Matt Maley at Miller Tabak + Co., with so many different comments coming out of the White House, it’s hard for investors to have a lot of confidence on the near-term outlook.
“This is a fragile market,” said Adam Phillips at EP Wealth Advisors.
“The anxiety is clear in the market’s behavior and we’re hearing it in the voices of many clients as well. The market is struggling for direction today, but we’re bracing for additional volatility ahead as we await clarity on a long and growing list of issues.”
The S&P 500 rose 1.6%.
The yield on 10-year Treasuries fell five basis points to 4.21%.
A dollar gauge gained 0.3%.
Traders also watched closely a slew of headlines on tariffs.
“I do think one very interesting proposal that the Mexican government has made is perhaps matching the US on our China tariffs,” Bessent said in an interview with Bloomberg Television.
“I think it would be a nice gesture if the Canadians did it also, so in a way we could have ‘Fortress North America’ from the flood of Chinese imports,” he said.
A survey conducted by 22V Research shows there is no clear consensus on the odds of the Mexico and Canada tariffs going into effect next week.
The median guess was 50% odds, but the distribution of responses is fairly flat. Responses are even evenly split above and below 50% odds.
“Net net, no consensus,” wrote Dennis DeBusschere, founder of 22V.
He also noted that 68% of the investors polled think the recent market selloff was mostly or entirely due to tariffs.
Wall Street also got a degree of relief after data showed inflation isn’t heating up — with traders looking past a worrisome decline in consumer spending to focus on prospects for Fed policy easing.
The so-called core personal consumption expenditures price index, which excludes food and energy items, rose 0.3% from December.
From a year ago, it increased 2.6%, matching the smallest annual increase since early 2021.
Inflation-adjusted consumer spending fell 0.5%, marking the biggest monthly decline in almost four years.
“While additional rate cuts are still probably many months away, we believe this report helps to keep one or two rate cuts on the table for 2025,” said Robert Ruggirello at Brave Eagle Wealth Management.
“We believe that inflation is yesterday’s problem and that the data will continue to improve going forward.”
To David Russell at TradeStation, the PCE report provides a “little comfort” after the worrisome print on consumer prices.
“The drop in personal spending confirms the negative retail sales data we got earlier, suggesting the economy started 2025 on a soft footing,” he said.
“Combined with the weak data so far in February, growth is becoming more of a concern for Wall Street. The consumer may finally be throwing in the towel.”
Chris Zaccarelli at Northlight Asset Management says he’s very cautious on the market given the high current valuations, the high policy uncertainty companies are forced to navigate and a consensus belief that recession risk is non-existent (or extremely low).
Atlanta Fed GDPNow Sees Economy Shrinking After Friday Data “Softer consumer spending and slower income growth should catch the Fed’s attention,” said Jeff Roach at LPL Financial.
“Despite the deceleration in the annual pace of inflation, the monthly rate is still running hotter than the Fed would like.”
Roach says investors will continue to focus on the uncertain growth trajectory as real spending unexpectedly fall in January from weaker consumer demand.
“The odds are rising that the Fed’s next rate cut will be in June,” he said.
“Whether the next cut happens then or in July is less relevant than the number of cuts by end of year.
The current macro backdrop suggests only two cuts in total this year but more in 2026.”

Corporate Highlights:
* Microsoft Corp. is signaling the end of the line for Skype, the iconic internet calling and chat service it bought almost 14 years ago.
* Bath & Body Works Inc., a retailer of personal care products, was upgraded at Citigroup Inc. in the wake of the company’s results.
* Redfin Corp., an online real estate company, reported fourth- quarter results that were weaker than expected on key metrics and gave an outlook that is seen as disappointing.
* Rocket Lab USA Inc. delayed the launch of its Neutron rocket to the second half of the year and issued a revenue forecast for the first quarter which fell short of estimates. This prompted analysts to either lower or place their price targets under review.

Some of the main moves in markets:
Stocks
* The S&P 500 rose 1.6% as of 4 p.m. New York time
* The Nasdaq 100 rose 1.6%
* The Dow Jones Industrial Average rose 1.4%
* The MSCI World Index rose 1%
* Bloomberg Magnificent 7 Total Return Index rose 2%
* The Russell 2000 Index rose 1.1%
Currencies
* The Bloomberg Dollar Spot Index rose 0.3%
* The euro fell 0.2% to $1.0373
* The British pound fell 0.2% to $1.2579
* The Japanese yen fell 0.5% to 150.52 per dollar
Cryptocurrencies
* Bitcoin fell 0.2% to $84,138.87
* Ether fell 2.9% to $2,214.34
Bonds
* The yield on 10-year Treasuries declined five basis points to 4.21%
* Germany’s 10-year yield was little changed at 2.41%
* Britain’s 10-year yield declined three basis points to 4.48%
Commodities
* West Texas Intermediate crude fell 0.4% to $70.06 a barrel
* Spot gold fell 0.8% to $2,854.71 an ounce

This story was produced with the assistance of Bloomberg Automation.
–With assistance from Margaryta Kirakosian, John Viljoen and Chiranjivi Chakraborty.
Have a wonderful weekend everyone.

Be magnificent!
As ever,

Carolann
Excellence is never an accident.  It is always the result of high intention, sincere effort, and intelligent execution;
it represents the wise choice of many alternatives – choice, not chance, determines your destiny. – Aristotle, 384 BCE-332 BCE.

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