February 4, 2022 Newsletter

Dear Friends,

Tangents: Happy Friday.

February 4^th, 2004: Mark Zuckerberg launches Facebook from his Harvard dormitory room. BI: The Full Story of How Facebook was Founded » 

“Moonfall” premieres in US theaters today.  The movie is quite stellar. You’ll really enjoy this if you gravitate toward space disaster epics. 

MacKenzie Scott donates $133.5 million to educational non-profit.  Move aside Santa! Ms. Scott is coming to town… with millions of dollars in unsolicited donations.

A drawing bought for $30 at a yard sale has been valued at $10 million.  Maybe a treasure hunt at your neighbor’s next yard sale will make you a millionaire! Have hope!

Cat brains are shrinking, and it’s humans’ fault. (h/t Mike Smedley)

DaVinci’s screw-rotor design works on a drone.
PHOTOS OF THE DAY

Performers take part in the opening ceremony of the Beijing 2022 Winter Olympic Games at the National Stadium, known as the Bird’s Nest, in Beijing. The city once again hosted an opening ceremony for the Olympics and, like that for the Summer Games in 2008, it was directed by Zhang Yimou. The event was on a much smaller and more muted scale than that memorable occasion – with 3,000 people taking part as opposed to 15,000. The motto, in a Games inevitably affected by the Covid pandemic and mired with political controversy, was to be simple, safe and splendid.
CREDIT: Ben Stansall/AFP/Getty Images

Polar bears living in an abandoned weather station on Kolyuchin, an island in the Russian far east. Photographer Dmitry Kokh discovered the polar bears while on a trip to Wrangel Island, a Unesco-recognised nature reserve that serves as a refuge to the animals.
CREDIT: Dmitry Kokh

A resident looks at a group of Joaldunaks taking part in the traditional carnival between the Pyrenees villages of Ituren and Zubieta. The carnival has been cancelled due to Covid-19 for the last two years. This year it has returned as one of the most ancient carnival celebrations in Europe, with dozens of people donning sheepskins, lace petticoats, conical caps and cowbells as they parade to herald the advent of spring.
CREDIT: Álvaro Barrientos/AP

Market Closes for February 4^th, 2022

International Markets

Bonds

Currencies

Commodities

Market Commentary:
On this day in 1887, the Interstate Commerce Act was enacted, creating the U.S. Interstate Commerce Commission to regulate the conduct of private businesses acting in the public interest, such as railroads
Canada
By Bloomberg Automation
(Bloomberg) — The S&P/TSX Composite rose 0.8 percent at 21,271.85 in Toronto.
The move follows the previous session’s decrease of 1.3 percent.
Shopify Inc. contributed the most to the index gain, increasing 8.8 percent.
Hut 8 Mining Corp. had the largest increase, rising 13.0 percent.
Today, 167 of 241 shares rose, while 70 fell; 8 of 11 sectors were higher, led by information technology stocks.
Insights
* So far this week, the index rose 2.6 percent, heading for the biggest advance since the week ended March 12
* The index advanced 18 percent in the past 52 weeks. The MSCI AC Americas Index gained 14 percent in the same period
* The S&P/TSX Composite is 2.4 percent below its 52-week high on Nov. 16, 2021 and 18.6 percent above its low on Feb. 4, 2021
* S&P/TSX Composite is trading at a price-to-earnings ratio of 19 on a trailing basis and 14.8 times estimated earnings of its members for the coming year
* The index’s dividend yield is 2.6 percent on a trailing 12-month basis
* S&P/TSX Composite’s members have a total market capitalization of C$3.37t
* 30-day price volatility rose to 12.92 percent compared with 12.84 percent in the previous session and the average of 13.17 percent over the past month
================================================================
|Index Points | |
Sector Name | Move | % Change | Adv/Dec
================================================================
* Information Technology | 83.0884| 5.1| 12/4
* Financials | 38.1902| 0.5| 24/4
* Materials | 22.6283| 0.9| 43/11
* Energy | 19.3467| 0.6| 25/7
* Industrials | 7.4044| 0.3| 22/8
* Communication Services | 4.6405| 0.4| 5/2
* Health Care | 3.1552| 2.2| 7/1
* Consumer Discretionary | 1.5858| 0.2| 10/4
* Consumer Staples | -0.0011| 0.0| 2/9
* Real Estate | -1.0066| -0.2| 14/9
* Utilities | -1.1928| -0.1| 3/11
================================================================
| | |Volume VS | YTD
| Index | | 20D AVG | Change
Top Contributors |Points Move| % Change | (%) | (%)
================================================================
* Shopify | 70.5400| 8.8| -9.9| -35.8
* Canadian Natural
* Resources | 11.0700| 2.1| -21.9| 27.8
* Constellation Software | 8.4390| 3.0| -23.6| -7.6
* Magna International | -1.5160| -0.8| -7.1| -0.8
* Open Text | -4.3030| -3.9| 56.5| -5.5
* Suncor Energy | -4.5920| -1.2| 25.1| 15.8

US
By Jennifer Bissell-Linsk and Vildana Hajric
(Bloomberg) — Treasuries fell after a strong U.S. jobs report increased bets of tighter monetary policy while U.S. stocks powered higher on bullish sentiment from Amazon.com Inc. earnings.
The yield on the U.S. 10-year note rose to 1.92% as traders gave roughly even odds to the chance the Federal Reserve will start to raise interest rates with a 50 basis point hike in March instead of a typical quarter point move.
The S&P 500 gained 0.5%, erasing an earlier loss, while the Nasdaq 100 added 1.3% with Amazon up 14% on a price increase for Prime memberships.
The dollar was stronger against major peers while still posting its worst weekly performance since 2020.
U.S. employers added more jobs than forecast last month, despite a surge in Covid-19 infections and related business closures.
Nonfarm payrolls gained more than all economists expected and average hourly earnings also rose 0.7% month over month.
“The jobs report blew away expectations across the board,” said Cliff Hodge, chief investment officer for Cornerstone Wealth. “The report is unequivocally good for the economy, but not for markets as the strength in the numbers presents another data point which supports more aggressively hawkish Fed action.”
It’s been a volatile week in markets as investors were jolted by weak numbers at U.S. tech giants including Facebook-owner Meta Platforms Inc., which wiped more than $250 billion from its market value on Thursday.
However, positive earnings from Amazon helped lift sentiment, with the online marketplace and tech company adding roughly $190 billion to its market capitalization.
“It seems like each day we wake up to, ‘Thank you sir, may I have another?’ as a few tech blowups drag down the overall market,” said Mike Bailey, director of research at FBB Capital Partners. “There is an interesting behavioral metric where one bad thing requires four to five good things to make up for it.”
Here’s what else Wall Street said Friday:
“Hopefully now that the week is coming to a close, we’re seeing that the economy is still strong based on this jobs report, that people can take a breath and really reassess what is the economic environment that we’re going into in the year ahead.” — Lindsey Bell, chief markets and money strategist at Ally
“The January employment report was strong overall, informs us that businesses are willing to look through the Omicron shock (which is actually news), and reinforces the case for the Fed tightening.” — Gerard MacDonell, analyst at 22V Research
“It was always going to be a surprise as far as the payrolls report was concerned, given the range of outcomes. And we got a positive surprise … The Fed is further and further behind and they’re going to have to catch up.” – Anastasia Amoroso, chief investment strategist at iCapital
“The data reinforces the case for hikes and QT and I think the 10-year should rise more, especially real rates. With the 10-year getting close to 2%, I worry about mortgage-backed securities convexity hedging and more bond fund outflows.” –Priya Misra, global head of rates strategy at TD Securities
“A better-than-expected jobs report only fuels the Fed’s fire to raise rates, and act quickly. While they’ve already signaled that the labor market is in a good place, there was potential for omicron to derail that progress — and that just doesn’t seem to be the case. So with the market typically unwelcoming of news that could accelerate the pace of action from the Fed, we could see some volatility.” — Mike Loewengart,
managing director of investment strategy at E*Trade from Morgan Stanley
Dip buyers have hoped a stronger earnings season would keep equities attractive and counter some concerns about rate hikes in the face of higher inflation.
Of the 272 companies in the S&P 500 that have reported results, 82% have met or beaten estimates, with profits coming in 8.8% above projected levels.
Still, signs of stubborn price pressures abound with the latest data showing U.S. gasoline prices at the highest in more than seven years.
Crude oil gained 2.2% in New York, extending a seven-year high, while banks including Goldman Sachs Group Inc. now forecast Brent will reach $100 a barrel.
Hawkish comments from European Central Bank President Christine Lagarde and a Bank of England interest-rate hike underlined risks from inflation.
While a selloff in the region’s bonds eased Friday, the mood in the stock market was sour with Europe’s Stoxx 600 falling 1.4%.
Some of the main moves in markets:
Stocks
* The S&P 500 rose 0.5% as of 4 p.m. New York time
* The Nasdaq 100 rose 1.3%
* The Dow Jones Industrial Average was little changed
* The MSCI World index rose 0.4%
Currencies
* The Bloomberg Dollar Spot Index rose 0.2%
* The euro rose 0.1% to $1.1454
* The British pound fell 0.5% to $1.3530
* The Japanese yen fell 0.2% to 115.20 per dollar
Bonds
* The yield on 10-year Treasuries advanced nine basis points to 1.92%
* Germany’s 10-year yield advanced six basis points to 0.21%
* Britain’s 10-year yield advanced four basis points to 1.41%
Commodities
* West Texas Intermediate crude rose 2.2% to $92.23 a barrel
* Gold futures rose 0.2% to $1,808.30 an ounce
–With assistance from Elaine Chen, Peyton Forte, Sunil Jagtiani and Srinivasan Sivabalan.
Have a wonderful weekend everyone.

Be magnificent!

As ever,

Carolann

Worry never robs tomorrow of its sorrow, it only saps today of its joy. –Leo Buscaglia, 1924-1998.

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