January 26, 2023 Newsletter

Dear Friends,

Tangents: Happy Friday Eve.

January 26, 1905: The world’s largest diamond ever, the Cullinan, which weighs 3,106.75 carats (0.621350 kg), is found at the Premier Mine near Pretoria in South Africa.
1788: The first European settlers in Australia landed in present-day Sydney.  Go to article » 

Asteroid set to make ‘extraordinarily close’ approach to Earth tonight. Here’s how to watch.  A small but zippy asteroid will pass close to Earth on Thursday, not to be seen again until 2036.
Asteroid 2023 BU is only about 12 to 26.9 feet (3.7 to 8.2 meters) in diameter and was discovered less than a week ago on January 21 by amateur astronomer Gennadiy Borisov.  Full Story: Live Science (1/26)

52-foot-long Book of the Dead papyrus from ancient Egypt discovered at Saqqara.  Archaeologists in Egypt have discovered a 52-foot-long (16 meters) papyrus containing sections from the Book of the Dead.
The more than 2,000-year-old document was found within a coffin in a tomb south of the Step Pyramid of Djoser at Saqqara.  Full Story: Live Science (1/26)

NASA to test nuclear rocket engine that could take humans to Mars in 45 days.  NASA has revealed plans to create a nuclear-powered rocket that could send astronauts to Mars in just 45 days. The agency, which has partnered with the Pentagon’s Defense Advanced Research Projects Agency (DARPA) to design the rocket, announced on Tuesday (Jan. 24) that it could build a working nuclear thermal rocket engine as soon as 2027.
Full Story: Live Science (1/25)

PHOTOS OF THE DAY

Delhi, India
Members of the Indian central reserve police force join a parade during the 74th Republic Day celebrations in New Delhi. The Republic Day of India marks the date on which the Constitution of India came into force on 26 January 1950 and the country began its transition from a British Dominion into a republic
Photograph: Hjarish Tyagi/EPA

Puebla, Mexico
A column of smoke rises from Popocatepetl Volcano, the second highest peak in Mexico, in the Izta-Popo Zoquiapan national park
Photograph: Anadolu Agency/Getty Images

Agamon Hula, Israel
A hawk lands over a dead Gray Crane at the Agamon Hula Conservation Lake in the north of Israel. As a major stopover for migrating birds along the Syrian-African Rift, hundreds of thousands of birds pass yearly making their way to Africa and then back to Europe
Photograph: Atef Safadi/EPA
Market Closes for January 26^th, 2023

International Markets

Bonds

Currencies

Commodities

Market Commentary:
On this day in 1850, Samuel Gompers was born in London, England. Gompers went on to become the founding president of the American Federation of Labor in 1886 after working in a cigar factory. The nationwide group of unions became a driving force in the expansion of worker rights and galvanized the labor movement with strikes and boycotts.
Canada
By Bloomberg Automation
(Bloomberg) — The S&P/TSX Composite rose 0.5% at 20,700.50 in Toronto.
The index advanced to the highest closing level since June 8 after the previous session’s decrease of 0.1%.
Royal Bank of Canada contributed the most to the index gain, increasing 1.6%.
Interfor Corp. had the largest increase, rising 10.4%.
Today, 135 of 236 shares rose, while 99 fell; 6 of 11 sectors were higher, led by financials stocks.
Insights
* This month, the index rose 6.8%
* So far this week, the index rose 1%
* The index advanced 0.5% in the past 52 weeks. The MSCI AC Americas Index lost 7% in the same period
* The S&P/TSX Composite is 6.8% below its 52-week high on April 5, 2022 and 15.8% above its low on Oct. 13, 2022
* The S&P/TSX Composite is up 1.8% in the past 5 days and rose 6.1% in the past 30 days
* S&P/TSX Composite is trading at a price-to-earnings ratio of 13.7 on a trailing basis and 13.4 times estimated earnings of its members for the coming year
* The index’s dividend yield is 3.1% on a trailing 12-month basis
* S&P/TSX Composite’s members have a total market capitalization of C$3.28t
* 30-day price volatility rose to 12.92% compared with 12.87% in the previous session and the average of 13.12% over the past month
================================================================
|Index Points | |
Sector Name | Move | % Change | Adv/Dec
================================================================
Financials | 67.1850| 1.1| 24/5
Energy | 50.3172| 1.4| 24/15
Information Technology | 12.5654| 1.0| 10/4
Real Estate | 1.7572| 0.3| 14/8
Communication Services | 1.0118| 0.1| 4/2
Health Care | 0.3697| 0.4| 4/3
Consumer Discretionary | -2.0989| -0.3| 10/5
Utilities | -4.1537| -0.5| 3/13
Industrials | -7.2685| -0.3| 17/9
Consumer Staples | -8.8689| -1.1| 5/6
Materials | -9.9230| -0.4| 20/29
================================================================
| | |Volume VS | YTD
| Index | | 20D AVG | Change
Top Contributors |Points Move| % Change | (%) | (%)
================================================================
RBC | 20.3800| 1.6| 97.3| 6.5
Suncor Energy | 16.2000| 3.9| 95.0| 7.3
Cenovus Energy | 11.8300| 4.8| 66.9| 2.2
Agnico Eagle Mines | -4.4980| -1.8| 75.2| 8.1
Franco-Nevada | -6.5100| -2.4| -17.4| 6.8
Couche-Tard | -7.2200| -2.2| 12.8| 2.4
US
By Rita Nazareth
(Bloomberg) — Tech mega caps powered a stock-market rebound, tempering data suggesting that while the Federal Reserve still has a path to a soft landing, the risk of a recession this year is very much alive.
The S&P 500 closed at its highest since early December.
Tesla Inc. topped the $500 billion mark, leading gains in the Nasdaq 100 as Elon Musk teased potential for the carmaker to produce 2 million vehicles in 2023.
In late trading, chipmaker Intel Corp. tumbled on a bleak forecast.
US gross domestic product expanded at a faster-than-estimated pace into the end of 2022, but there were signs of slowing underlying demand as the steepest rate hikes in decades threaten growth.
The Fed is expected to boost rates by 25 basis points next week amid bets the central bank is approaching the end of its tightening cycle.
Yet officials are signaling that rates will stay high through the rest of this year.
The economy continues to be very resilient in the face of rate increases, but plenty of risks lie ahead, so “we wouldn’t be so quick to blow the all clear,” said Chris Zaccarelli at Independent Advisor Alliance.
“That said, this year’s stock-market rally is impressive and shouldn’t be ignored,” the firm’s chief investment officer added. “Unfortunately, the Fed is likely to start talking down the market again, as early as next week, so prepare for
volatility. We may be in the eye of the hurricane and not completely out of the woods yet.”
To Chris Gaffney, president of world markets at TIAA Bank, the recent data show the Fed is doing a good job, “but there’s more work to be done.”
A team led by Deutsche Bank AG’s Binky Chadha is maintaining its view that the S&P 500 can rise to 4,500 by the end of the first quarter, about 11% above Thursday’s close, before sliding amid an economic contraction.
The benchmark is headed for its best January since 2019.
However, it seems like many investors still don’t have the appetite to chase the rally.
Some 35% of clients in a recent JPMorgan Chase & Co. survey said they plan to add to stock holdings in the coming weeks.
That’s a hair away from a 33% reading in late November that marked an all-time low.
Investors fretting about the prospects for global earnings growth may want to brace for a long slog this year, and stiff headwinds to equities as a result.
Analysts’ estimates for 2023 profits continue to fall, with major regions showing negative revision momentum, according to research from Bloomberg Intelligence’s Gina Martin Adams and Gillian Wolff.
In the US, for example, sell-side analysts have lowered projections by more than half since September, while the outlook for emerging markets has slumped even more.

Corporate Highlights:
* Visa Inc. and Mastercard Inc. saw purchase volumes on their cards climb less than expected in the final three months of the year.
* Hasbro Inc., one of the world’s largest toymakers, said it would cut jobs after a disappointing holiday shopping season.
* Bed Bath & Beyond Inc. said it received a default notice from JPMorgan Chase & Co. after it failed to prepay an over advance and satisfy certain creditor protections.
* American Airlines Group Inc. expects profit this year to exceed estimates following a slow start.
* Southwest Airlines Co.’s operations meltdown last month will lead to a first-quarter loss.
* Comcast Corp. topped Wall Street profit estimates in the fourth quarter despite continuing to lose customers in its cable and broadband businesses.
Meantime, Thursday’s auction of seven-year Treasury notes ensured that January will be one of the best months ever for US government debt auctions.
The high demand reflects investor wagers that the Fed is nearing the end of its rate hikes as inflation comes down from its peak.
Traders also continued to keep an eye on the latest geopolitical developments.
The International Monetary Fund is exploring a multiyear aid package for Ukraine worth as much as $16 billion to help cover the country’s needs and provide a catalyst for more international funding while Kyiv tries to repel Russian forces, according to people familiar with the matter.
Key events:
* American Express, Charter Communications, Chevron, HCA Healthcare to report results Friday
* US personal income/spending, PCE deflator, University of Michigan consumer sentiment, pending home sales, Friday

Some of the main moves in markets:
Stocks
* The S&P 500 rose 1.1% as of 4 p.m. New York time
* The Nasdaq 100 rose 2%
* The Dow Jones Industrial Average rose 0.6%
* The Stoxx Europe 600 rose 0.4%
* The MSCI World index rose 0.9%
Currencies
* The Bloomberg Dollar Spot Index was little changed
* The euro fell 0.2% to $1.0891
* The British pound was little changed at $1.2412
* The Japanese yen fell 0.5% to 130.23 per dollar
Cryptocurrencies
* Bitcoin fell 2.1% to $23,112.34
* Ether fell 0.6% to $1,608.75
Bonds
* The yield on 10-year Treasuries advanced five basis points to 3.49%
* Germany’s 10-year yield advanced six basis points to 2.22%
* Britain’s 10-year yield advanced seven basis points to 3.32%
Commodities
* West Texas Intermediate crude rose 1.2% to $81.10 a barrel
* Gold futures fell 0.6% to $1,946.90 an ounce
This story was produced with the assistance of Bloomberg Automation.
–With assistance from Cecile Gutscher, Sujata Rao, Isabelle Lee, Vildana Hajric and Peyton Forte.
Have a lovely evening.

Be magnificent!
As ever,

Carolann

A great many people think they are thinking when they are merely rearranging their prejudices. –William James, 1845-1910.

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