January 25, 2013 Newsletter

Dear Friends,

Tangents:

An interesting fact in history today!  On this day, January 25^th, 1905 the largest diamond ever was found! The diamond was discovered in the Premier Mine in Pretoria, South Africa, during a routine inspection by the mine’s supervisor. It was a 3,106 – carat diamond weighing in at a whopping 1.33 pounds! It was given the name, the “Cullinan”. The Cullinan was later cut into nine large stones and about 100 smaller ones, valued at millions of dollars!

Also on this day:

1881 – Thomas Edison, Alexander Graham Bell and others signed an agreement to organize the Oriental Telephone Company.

1915 – In New York, Alexander Graham Bell spoke to his assistant in San Francisco, inaugurating the first transcontinental telephone service.

1924 – The 1st Winter Olympic Games were inaugurated in Chamonix in the French Alps.

1937 – NBC radio presented the first broadcast of “The Guiding Light.” The show remained on radio until 1956 and began on CBS-TV in 1952.

1945 – Richard Tucker debuted at the Metropolitan Opera House in New York City in the production of “La Gioconda”.

1946 – The United Mine Workers rejoined the American Federation of Labor.

1949 – The first Emmys were presented at the Hollywood Athletic Club.

1959 – In the U.S., American Airlines had the first scheduled transcontinental flight of a Boeing 707.

1961 – John F. Kennedy presented the first live presidential news conference from Washington, DC. The event was carried on radio and television.

“Life is 10% what happens to you and 90% how you respond to it” – Unknown

photos of the day 01/25/2013

Satoria Ginn, left, throws snow at Desiree Lyons during a snow battle along Laurel Street in Pocomoke City, Md. The snow was very dry making snowballs hard to make, so they settled for throwing snow at each other. Grant L. Gursky/Salisbury Daily Times/AP

Ghana fans cheer their team during their African Nations Cup Group B soccer match against Mali at the Nelson Mandela Bay Stadium in Port Elizabeth. Siphiwe Sibeko/Reuters

“Before you act, listen. Before you react, think. Before you spend, earn. Before you criticize, wait. Before you pray, forgive. Before you quit, try” – Ernest Hemingway

Market Closes for January 25th, 2013

International Markets

Bonds

Currencies

Commodities

Market Commentary:

Canada

By Eric Lam and Sarah Pringle

Jan. 25 (Bloomberg) — Canadian stocks fell as metals producers slumped, offsetting economic optimism after the European Central Bank said banks will repay more of their loans than forecast and U.S. corporate earnings topped forecasts.

Kinross Gold Corp. and Eldorado Gold Corp. slumped more than 5.1 percent as the gold price fell to a two-week low.

Silver Wheaton Corp. and Silver Standard Resources Inc. lost at least 1.8 percent as the price of the metal declined. Pacific Rubiales Energy Corp. climbed 3.6 percent after one of its development partners discovered oil off the coast of Brazil.

Agrium Inc. gained 1.3 percent after an analyst with Desjardins Securities Inc. raised his rating for the stock to a buy.

The Standard & Poor’s/TSX Composite Index fell 7.59 points, or 0.1 percent, to 12,816.03 in Toronto. The benchmark gauge increased 0.7 percent this week for a fourth week of gains, the longest stretch in almost a year.

“The whole world has had a nice recovery,” Barry Schwartz, who helps manage C$480 million ($476 million) as a fund manager at Toronto-based Baskin Financial Services, said in a phone interview. “So far the U.S. profits have been very strong. I would suspect we’re going to see that go across the border. That will lead us to continue to rally as we are.”

Some 278 European financial institutions will return 137.2 billion euros ($184.4 billion) on Jan. 30, the first opportunity for early repayment of the initial three-year loan, the Frankfurt-based ECB said in a statement today. That compares with the median forecast of 84 billion euros in a Bloomberg News survey of economists.

About 76 percent of the 147 companies in the S&P 500 that have released results so far this quarter exceeded profit projections. Analysts are turning more optimistic about U.S. earnings, boosting their projections for fourth-quarter profit growth to 4 percent from 2.9 percent at the beginning of the month, the data show.

Gold producers contributed most to declines in the S&P/TSX.

Trading volume was 7.1 percent lower than the 30-day average.

The S&P/TSX Gold subindex fell 2.5 percent to its lowest level since August as 30 of 31 members declined.

Kinross sank 5.1 percent to C$8.58 and Eldorado Gold tumbled 5.3 percent to C$11.55. Gold for February delivery lost 0.8 percent to settle at $1,656.60 an ounce in New York, for a third straight day of declines.

Silver Wheaton lost 2.1 percent to C$34.55 and Silver Standard Resources slipped 1.8 percent to C$12.40. Silver for March delivery fell 1.6 percent to $31.206 an ounce.

Pacific Rubiales rose 3.6 percent to C$23.26 after Karoon Gas Australia Ltd. said it has found oil at the Kangaroo-1 exploration well in Brazil’s Santos Basin. Pacific Rubiales in September agreed to purchase a 35 percent stake in Karoon’s exploration blocks off Brazil.

Agrium, operator of the largest U.S. network of agricultural retail outlets, added 1.3 percent to a record C$115.36.

John Hughes, an analyst with Desjardins, raised his rating for the stock to buy from hold while increasing his price target to C$125 from C$106.30 after the company reported fourth-quarter earnings that exceeded analysts’ estimates. Profit excluding one-time items will be “slightly above” $2 a share, buoyed by demand for crop nutrients, Calgary-based Agrium said in a statement yesterday. In November, the company forecast $1.50 to $1.90 a share.

Research in Motion Ltd. fell 1.1 percent to C$17.61. Canada would closely examine any proposal for a tie-up between Chinese computer-maker Lenovo Group Ltd. and RIM, Finance Minister Jim Flaherty said in an interview at the World Economic Forum’s annual meeting in Davos, Switzerland yesterday.

The BlackBerry maker jumped 2.9 percent yesterday to the highest level in more than a year after Lenovo said it was considering a bid among other options for expanding its mobile- devices business. RIM, Canada’s largest-listed technology company, has said it’s assessing strategic options after losing market share to Apple Inc. and Samsung Electronics Co.

US

By Stephen Kirkland, Inyoung Hwang and Sarah Pringle

Jan. 25 (Bloomberg) — U.S. stocks rose, sending the Standard & Poor’s 500 Index to its first eight-day rally since 2004, as companies from Microsoft Corp. to Procter & Gamble Co. posted better-than-estimated earnings. The euro strengthened to an 11-month high while the yen traded at the lowest since 2010.

The Standard & Poor’s 500 Index added 0.5 percent to 1,502.96 at 4 p.m. in New York, its first close above 1,500 since 2007, even as Apple Inc. slid 2.4 percent and relinquished its position as the world’s biggest company by market value. The euro climbed 0.6 percent to $1.3456 as the European Central Bank said banks will repay more of its loans than economists forecast. The yen slid 0.7 percent versus the dollar. Oil capped a seventh weekly gain, the longest rally in almost four years.

Stocks extended their 2013 advance as earnings beat estimates at 10 of 13 companies in the S&P 500 that reported results since the close of markets yesterday. Per-share profit has exceeded the average analyst estimate at about 76 percent of the 147 companies in the index that released results so far in the reporting season, data compiled by Bloomberg show.

“With earnings surprisingly good, the trends are also more importantly favorable for the outlook for 2013, coupled with an economic recovery,” Christopher McHugh, who helps manage $3.5 billion at Turner Investment Partners in Berwyn, Pennsylvania, said in a telephone interview. “All that is fueling the continuation of a rally, but particularly the strong earnings growth that’s coming.”

Earnings have grown 12 percent for the S&P 500 companies that have reported results so far amid a 4.9 percent increase in sales. Profits for the entire index are forecast to have increased 4 percent in the period, according to analyst estimates compiled by Bloomberg.

Consumer and energy shares led gains among the 10 main industry groups in the S&P 500 today. The benchmark gauge of U.S. equities extended a fourth straight weekly gain. It needs to rise about 4.1 percent to reclaim its 2007 record of 1,565.15, while the Dow Jones Industrial Average must advance less than 2 percent to surpass its peak.

Microsoft Corp. climbed 0.9 percent to the highest since November after the world’s largest software maker said revenue rose while profit declined as the company spent more money to market its Windows operating system and lure consumers flocking to tablets and smartphones. P&G jumped 4 percent after also raising its 2013 forecast amid growth in market share in key categories.

Starbucks Corp., the world’s largest coffee-shop operator, advanced 4.1 percent as profit rose 13 percent in the fiscal first quarter, meeting analysts’ estimates.

Apple’s 12-month reign as the No. 1 stock ended after the shares slumped 17 percent this year, worse than any other companies in the S&P 500. The decline reduced its market capitalization to $413 billion, below Exxon Mobil Corp.’s $418 billion. Apple extended yesterday’s 12 percent tumble, triggered after the company reported the slowest profit growth since 2003.

Exxon Mobil added 0.4 percent to $91.73 today, its highest price since October.

The Stoxx Europe 600 Index added 0.3 percent and has increased 0.9 percent this week, halting two weeks of losses.

SolarWorld AG, Germany’s biggest solar-panel maker, slid 30 percent today after saying it needs to make “serious adjustments” to its debt structure.

The euro rose against 15 of its 16 major peers, trading for more than 85 British pence for the first time since Feb. 29. It strengthened 1.3 percent to 122.37 yen, and reached 122.77 yen, the highest since April 2011.

Banks will hand back 137.2 billion euros ($184 billion) of loans in their first early repayment of the ECB’s so-called Longer-Term Refinancing Operations, the central bank said today.

That’s more than 84 billion euros economists predicted in a Bloomberg survey.

“It shows that banks are quite comfortable in terms of off-loading excess liquidity,” said Padhraic Garvey, head of developed-market debt strategy at ING Bank NV in Amsterdam.

“This goes along with the theme of a reduction in the flight to safety.”

Italy’s 10-year bond yield fell three basis points to 4.13 percent, the lowest since 2010. German two-year notes dropped, pushing the yield eight basis points higher to 0.26 percent.

German business confidence rose for a third month in January, according to the Ifo institute’s business climate index.

The Japanese currency declined as much as 1 percent to 91.19 per dollar, the weakest level since June 2010 and capping an 11th weekly loss, the longest losing streak in data compiled by Bloomberg going back to 1971. Consumer prices fell for the seventh time in eight months in December, backing Prime Minister Shinzo Abe’s case for aggressive monetary easing to defeat deflation.

Cotton, lead and silver lost more than 1.6 percent to lead declines in 15 of 24 commodities in the S&P GSCI Index, sending the gauge down 0.2 percent. Gold futures dropped to a two-week low, falling 0.8 percent to $1,656.60 an ounce, amid reduced demand for the precious metal as a haven investment.

Copper slumped the most in a week, dropping 0.7 percent to $3.652 a pound, as an unexpected decrease in new-home sales tempered the demand outlook for the metal. Home sales fell 7.3 percent to a 369,000 annual pace, below the 385,000 median forecast in a Bloomberg survey of economists and the 398,000 rate in November that was the highest in more than two years, government figures showed today. Copper also fell after Anglo American Plc said it produced more of the metal last quarter.

The MSCI Emerging Markets Index lost 0.4 percent after Samsung Electronics Co. said the won’s strength is hurting profits and Kia Motors Corp.’s profit missed estimates. South Korea’s Kospi slid 0.9 percent, the most in more than a week.

The Shanghai Composite Index dropped 0.5 percent. Russia’s Micex added 0.7 percent to the highest level since April while India’s Sensex and Brazil’s Bovespa gained 0.9 percent.

Have a wonderful weekend!

Be magnificent!

“If you are lucky enough to find a way of life you love, you have to find the courage to live it” -John Irving

Karen Parnham

Assistant to Carolann Steinhoff

Queensbury Securities Inc.

St. Andrew’s Square

Suite 340A, 730 View St.,

Victoria, B.C. V8X 3Y7

Tel: 778-430-5808