January 8, 2015 Newsletter

Dear Friends,

Tangents:

Carolann is out of the office, I will be writing the newsletter on her behalf.

PHOTOS OF THE DAY

The waning moon is setting over the mountain ‘Les Cornettes de Bise’ located at the border of the Haute-Savoie and the Valais canton of Switzerland in the Chablais Alps, photographed from Glutieres, Switzerland. Anthony Anex/AP

A man looks over the high waves in the Mediterranean Sea in Tel Aviv, Israel, during a heavy winter storm sweeping through the Middle East. Oded Balilty/AP

Market Closes for January 8^th, 2015   

International Markets

Bonds

Currencies

Commodities

Market Commentary:

Canada

By Eric Lam

     (Bloomberg) — Canadian stocks rose for a second day, climbing the most in three weeks, as Valeant Pharmaceuticals International Inc. extended a record and crude prices held steady.

     Valeant jumped 6.2 percent, extending a record after raising its earnings forecasts for the year. Penn West Petroleum Ltd. and Pacific Rubiales Energy Corp. rallied at least 4.9 percent as energy producers advanced to snap a three-day slump. Insurers Sun Life Financial Inc. and Manulife Financial Corp. rose to pace gains among financials stocks.

     The Standard & Poor’s/TSX Composite Index rose 172.72 points, or 1.2 percent, to 14,457.72 at 4 p.m. in Toronto, the most since Dec. 17. The benchmark equity gauge has rallied 1.5 percent in two days, after posting the worst three-day start to a year since 2007.

     Valeant surged 6.2 percent for a second day of gains to give health-care stocks the best performance in the S&P/TSX. All of the 10 main industries in the S&P/TSX advanced as trading volume was 8.2 percent below the 30-day average.

     Valeant, Canada’s largest drugmaker, said it now forecasts 2015 cash earnings per share of $10.10 to $10.40, from $10. The company also boosted its forecasts for revenue.

     Global stocks rallied on signs central banks will likely remain stimulative. The MSCI World Index jumped 1.9 percent, the most in three weeks, as the S&P 500 rallied 1.8 percent in New York.

     Data in Europe indicated producer prices and German factory orders slid more than anticipated, bolstering the case for the European Central Bank to boost stimulus. The Federal Reserve yesterday signaled no change in interest-rate policy amid accelerating growth in the economy.

     Pacific Rubiales climbed 5.2 percent to C$6.08 and Penn West rose 4.9 percent to C$2.13 as the S&P/TSX Energy Index jumped 1.6 percent. The industry had lost 8.6 percent in the past three days. West Texas Intermediate crude rose 14 cents to settle at $48.79 a barrel in New York.

     Restaurant Brands International Inc., which owns the Burger King and Tim Hortons brands, surged 2.5 percent to C$47.65, a record.

     First Quantum Minerals Ltd. jumped 6.5 percent and Teck Resources Ltd. climbed 4.6 percent as copper rose for the second time in four days.

US

By Joseph Ciolli

     (Bloomberg) — Stocks targeted by bearish traders were among the biggest winners as this week’s rally got started.

     A group of the 50 companies in the Russell 3000 Index with the highest level of short interest rebounded 2.2 percent from an almost 20-month low yesterday, according to data compiled by Goldman Sachs Group Inc. and Bloomberg. That outpaced the Standard & Poor’s 500 Index, which rose 1.2 percent. Today the inverse has been true, with gains in the benchmark index beating the basket.

     The S&P 500 has recovered 3 percent over the past two days after absorbing its fifth decline of 4 percent or more since last January. The change in sentiment was brought about in part by the first gain for crude oil in five sessions, prompting short sellers to reconsider their positions, according to Ben Wallace of Grimes & Co.

     “The market turned around because of the oil rebound and short covering,” Wallace, a portfolio manager at Westborough, Massachusetts-based Grimes, said by phone. “Then you expect short covering to be followed by buying. At this point investors have been conditioned to think that any selloff is only temporary.”

     In a short sale, a bearish trader borrows stock and then sells it, hoping to replace it at a lower price.

     Equities also got a boost yesterday after the Federal Reserve signaled no change in interest-rate policy and optimism increased over employment growth. The benchmark U.S. equity index continued its rebound today, adding 1.8 percent to 2,062.40 at 2:51 p.m., wiping out losses for the year. The Goldman Sachs index of shorted stocks advanced 1.5 percent.

     Investors sought out defensive sectors such as health-care and consumer staples yesterday, making those the two best- performing groups in the S&P 500 with increases of more than 1.7 percent. Today, they embraced riskier areas. Technology companies led with a 2.4 percent increase, while commodity stocks in the index added at least 2 percent.

Have a wonderful evening everyone!

Be magnificent!

“One of the most beautiful qualities of true friendship is to understand and to be understood.” Lucius Annaeus Seneca

As ever,

Karen

Queensbury Securities Inc.,

St. Andrew’s Square,

Suite 340A, 730 View St.,

Victoria, B.C. V8W 3Y7