January 31, 2020 Newsletter

Dear Friends,

Tangents:  HAPPY FRIDAY!

And yes, we made it through January – welcome February!
February was the month of purification among the ancient Romans (Latin februum, “purgation”).
Februa was the Roman festival of Purification.   To purify is to separate the gold from the dross, the good from the bad.  It requires memory and the practice of discernment is often symbolized by a sword, but there is something feminine about February.  It is a  month filled with feasts celebrating female figures like St. Brigit, the Virgin Mary, and the Virgin Goddess Artemis.   Sunday, February 2^nd, is Candlemas Day – the feast of the Purification of the Blessed Virgin Mary.  The days will soon lengthen.  The sun is still more red than gold.  Yet the sky brightens when the clouds part and the rain (or snow) passes.  The month also opens with the Celtic festival of Imbolc, marking the lactation of the ewes, the flow of milk announcing the return of life: the joy of becoming, though Spring is still far away.

It is said that if the weather is fine and frosty at the close of January and the beginning of February, there is more winter ahead than behind.  Well, no worries on the wet coast – looks like there won’t be much winter left!  The Dutch used to call the month
Spokkelmaand (vegetation month).  The Anglo-Saxons knew it as Somōnath (mud month).  In the French Revolutionary calendar, its equivalent from 21 January to 19 February was Pluviôse (rain month).
Birthstone: Amethyst
Flower: Violet
Aquarius to February 18^th then Pisces, February 19-March 20^th.

Have a great Super Bowl Sunday!
At this year’s Super Bowl, the drinks will be served in aluminum cups.-CNN.
Groundhog Day, February 2^nd:
Punxsutawney Phil may retire early. Ahead of Groundhog Day, PETA pitched a robotic AI-groundhog that can predict weather more accurately.-Bloomberg.

Kobe fans paid vivid tribute. Artists worldwide splashed vibrant murals upon buildings and basketball courts to honor the NBA legend.-Bloomberg/

PHOTOS OF THE DAY

The Mall in London is lined by patriotic red, white & blue Union Jack flags to mark Great Britain’s exit from the European Union.
CREDIT: MATT SPRAKE/SPLASHNEWS.COM

Emilia langman from Falmouth surrounded by a field of daffodils near Penzance.
CREDIT: SIMON MAYCOCK/ALAMY LIVE NEWS

White pelicans, one of the largest birds from Canada and the United States, flying over the shore of the Chapala lagoon in Cojumatlan, Mexico.

They travel thousands of kilometers migrating from the low temperatures of North America.
CREDIT: ULISES RUIZ/AFP/GETTY IMAGES

People play on an installation called “impulse”. Twelve glowing LED seesaws, which range in length from 16 to 24 feet on Broadway, New York.
CREDIT: JOHANNES EISELE/AFP/GETTY IMAGES

Market Closes for January 31^st, 2020 

International Markets

Bonds

Currencies

Commodities

Market Commentary:
On this day in 1940, the first monthly Social Security check was issued to Ida May Fuller, a 65-year-old retired legal secretary in Ludlow, Vt. Because Social Security was launched only three years before she retired, Ms. Fuller had paid a cumulative total of only $24.75 in Social Security taxes. But her initial monthly check was $22.54—and, by the time she died in 1975 at the age of 100, Ms. Fuller had collected a lifetime total of $22,888.92 in Social Security benefits (nearly 1,000 times what she paid in).

Canada
By Aoyon Ashraf
(Bloomberg) — Canadian equities fell with global stocks as the spread of China’s coronavirus raised the risk of further slowdown of the world’s economy. The S&P/TSX Composite Index fell 1% to 17,318.49 on Friday. The move is the biggest since falling 1.3% on Oct. 1. Materials were the only sector that gained, led by gold and silver miners as prices for the precious metals rose on safe haven demand. Canadian Natural Resources contributed the most to the index decline, decreasing 4%. Methanex had the largest drop, falling 7.6%. Wheaton Precious Metals provided the biggest boost to the index, advancing 1.9%. Centerra Gold had the biggest gain, rising 6.3%.
Commodities
* Western Canada Select crude oil traded at a $20.65 discount to WTI
* Spot gold rose 0.8% to $1,586.51 an ounce
FX/Bonds
* The Canadian dollar fell 0.2% to C$1.3237 per U.S. dollar
* The Canada 10-year government bond yield fell 4.2 basis points to 1.274%
Insights
* In the past year, the index had a similar or greater loss five times. The next day, it declined three times for an average 0.4% and advanced twice for an average 0.4%
* This month, the index rose 1.5%
* The index advanced 11% in the past 52 weeks. The MSCI AC Americas Index gained 18% in the same period
* The Canada S&P/TSX is 2% below its 52-week high on Jan. 22, 2020 and 12% above its low on Feb. 1, 2019

US
By Rita Nazareth and Vildana Hajric
(Bloomberg) — Stocks slumped and bonds rallied on heightened concern that the spread of the coronavirus will slam global economic growth. The S&P 500 Index erased its 2020 gain and the Dow Jones Industrial Average dropped more than 600 points as traders remained on edge over the impact of the disease that’s now infected about 10,000 people around the world. A gauge of U.S. equity volatility spiked to an almost four-month high. Caterpillar Inc. plunged as its outlook trailed estimates, adding to worries about global business spending. Amazon.com Inc. soared after a blowout quarter. Treasury 30-year yields breached 2% for the first time since October.

     Investors in China will get their first chance to trade since Jan. 23 as financial markets reopen on Monday. For equities, the declines are likely to be exacerbated by the amount of leverage. That could create a downward spiral where steep losses become steeper with traders facing margin calls. As an example of how extreme selling can be, the Shanghai stock benchmark fell almost 6% in May, when it resumed trading following a holiday break on negative trade-war news. With all the angst over the viral outbreak this week, the offshore yuan tested the key level of 7.
The final week of January was tumultuous across global markets as a barrage of corporate earnings, central-bank decisions and economic data landed in the growing shadow of the epidemic. The outbreak will cut U.S. economic growth by 0.4 percentage point in the first quarter as the number of tourists from China plunges and exports to the Asian nation slow, according to Goldman Sachs Group Inc. Still, a report showed that American consumer sentiment increased in January to an eight-month high, indicating sustained optimism in the face of the coronavirus.

     “The virus outbreak represents this unknown that, frankly, markets aren’t very good at handicapping,” said David Lafferty, chief market strategist at Natixis Investment Managers in Boston. “It’s almost like an open-ended risk.” American stocks had their worst month since August, with the S&P 500 dropping more than 3% from its all-time high on Jan. 17, led by energy and raw-material companies. While the benchmark gauge and the Dow Average both erased gains for the year, the Nasdaq Composite Index still held on to a 2% advance in 2020. It was the first time since Sept. 2018 that the major equity measures failed to move together on a monthly basis.
Some other corporate highlights:
* U.S. Steel Corp. reported the worst loss in almost three years and expects similar results this quarter.
* Exxon Mobil Corp. and Chevron Corp. posted the weakest results in years amid disappointing numbers in almost all business lines.
* Honeywell International Inc. sales forecast disappointed analysts as an industrial slowdown crimped revenue growth.
* Boeing Co. was cut by Moody’s Investors Service to the lowest tier of investment grade.
* Visa Inc. said the incentives it hands out to banks and retailers will climb faster than revenue and are on track to be at the high end of its targeted range for 2020.
* Colgate-Palmolive Corp. posted strong sales growth last quarter even as it raised prices to consumers.

Elsewhere, oil is off to the worst start to a year since 1991 on concern that the spread of coronavirus will curb demand for transportation fuels. Emerging-market shares fell for a seventh day while Brazil’s real sank to an all-time low. The pound ended a tumultuous month on a high note amid Britain’s exit from the European Union.

These are some of the main moves in markets:
Stocks
* The S&P 500 sank 1.8% as of 4 p.m. New York time, the largest tumble in four months.
* The Stoxx Europe 600 Index decreased 1.1%.
* The MSCI Emerging Market Index fell 1%.
Currencies
* The Bloomberg Dollar Spot Index dipped 0.3%.
* The euro increased 0.6% to $1.1094.
* The Japanese yen appreciated 0.6% to 108.35 per dollar.
Bonds
* The yield on 10-year Treasuries declined eight basis points to 1.51%.
* Germany’s 10-year yield decreased three basis points to -0.43%.
* Britain’s 10-year yield fell two basis points to 0.524%.
Commodities
* The Bloomberg Commodity Index decreased 0.4%.
* West Texas Intermediate crude dipped 1.1% to $51.56 a barrel.
* Gold strengthened 1% to $1,589.26 an ounce.

–With assistance from Cormac Mullen, Todd White, Sam Potter, Constantine Courcoulas, Claire Ballentine, Elizabeth Stanton, Justina Vasquez, Sophie Caronello and Nancy Moran.
Have a  wonderful weekend everyone.

Be magnificent!
As ever,

Carolann

There are two ways of spreading light: to be the candle or the mirror that reflects it.
                                                                                               -Edith Wharton, 1862-1937                    

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