January 9, 2023 Newsletter

Dear Friends,

Tangents: Happy Monday.
January 9, 1868:  Last convict ship, the Hougoumont, arrives in Freemantle, ending 80 years of penal transportation to Australia.
1964: President Lyndon B. Johnson declared a war on poverty.  How did that work out?   Go to article » 

Simone de Beauvoir, writer, b. 1908.
Joan Baez, folk singer, b. 1941.

You can still stay at the world’s oldest hotel, Nisiyama Onsen Keiunkan in Japan, which was founded in 705 AD.

A messy sibling rivalry is pure kryptonite for a drama-hungry public, and Prince Harry knows it. — Martin Ivens

The world’s no. 1 restaurant is closing its doors. How can you top that in a second act? — Howard Chua-Eoan

Want to avoid death? Human antifreeze might be just the thing for you. — Parmy Olson

Why hasn’t ET phoned Earth? Maybe aliens are waiting for the exact right moment.   Aliens may be waiting until a cosmic version of “high noon” to send out their signals to us, scientists have suggested.
In a new study, researchers hunted for technological signs of E.T. during the moments when exoplanets pass directly in front of their suns, from Earth’s point of view. These exact moments could be the perfect chance for an alien world to beam out a signal to Earthlings in an attempt to make contact.  Full Story: Live Science (1/6)

Why ancient Roman structures like the Pantheon still stand.  Modern concrete can crumble in just decades. So how are ancient Roman temples still standing after 2,000 years? Well, researchers say the Romans used this mystery ingredient to make their concrete super durable.

PHOTOS OF THE DAY

Brunnen, Switzerland
Revellers in traditional costumes and masks inspired by those of the Venetian Commedia dell’Arte march through the small Swiss town during a parade that marks the beginning of carnival season
Photograph: Urs Flueeler/EPA

Adelaide, Australia
Visitors inspect the Titan arum, aka Corpse Flower, as it begins to bloom at the city’s botanic gardens. It is the first time that the endangered plant has flowered in nearly 10 years at the gardens
Photograph: Matt Turner/EPA

Vatican, Italy
Pope Francis poses with ambassadors to the Holy See inside the Sistine chapel during his annual audience
Photograph: Vatican Pool/Getty Images
Market Closes for January 9^th, 2023

International Markets

Bonds

Currencies

Commodities

Market Commentary:
On this day in 1790, Treasury Secretary Alexander Hamilton submitted to Congress his “Report on the Public Credit,” which proposed buying distressed bonds to consolidate the national debt. U.S. and state bonds, which had been trading at a fraction of their value, jumped in price. In turn, several members of Congress hired sailboats and stagecoaches to take them south so they could snap up bonds at bargain prices before Southern newspapers shared the news of Hamilton’s proposals.
Canada
By Bloomberg Automation
(Bloomberg) — The S&P/TSX Composite rose for the second day, climbing 0.2%, or 42.56 to 19,857.07 in Toronto.
The index advanced to the highest closing level since Dec. 14.
Royal Bank of Canada contributed the most to the index gain, increasing 0.7%.
Ballard Power Systems Inc. had the largest increase, rising 7.3%.
Today, 126 of 236 shares rose, while 108 fell; 7 of 11 sectors were higher, led by energy stocks.
Insights
* The index declined 5.8% in the past 52 weeks. The MSCI AC Americas Index lost 17% in the same period
* The S&P/TSX Composite is 10.6% below its 52-week high on April 5, 2022 and 11.1% above its low on Oct. 13, 2022
* The S&P/TSX Composite is up 2.4% in the past 5 days and fell 0.5% in the past 30 days
* S&P/TSX Composite is trading at a price-to-earnings ratio of 13.1 on a trailing basis and 12.6 times estimated earnings of its members for the coming year
* The index’s dividend yield is 3.2% on a trailing 12-month basis
* S&P/TSX Composite’s members have a total market capitalization of C$3.21t
* 30-day price volatility fell to 13.47% compared with 13.49% in
the previous session and the average of 13.72% over the past month
================================================================
| Index Points | |
Sector Name | Move | % Change | Adv/Dec
================================================================
Energy | 27.6861| 0.8| 34/5
Financials | 13.2464| 0.2| 15/14
Information Technology | 10.0473| 0.9| 13/1
Industrials | 4.4956| 0.2| 14/12
Real Estate | 3.6846| 0.7| 15/8
Utilities | 3.5499| 0.4| 8/7
Consumer Staples | 2.4288| 0.3| 7/4
Health Care | -1.7468| -2.3| 3/4
Communication Services | -2.3186| -0.2| 1/5
Consumer Discretionary | -4.8431| -0.7| 7/8
Materials | -13.6617| -0.6| 9/40
================================================================
| | |Volume VS |
| Index | | 20D AVG |YTD Change
Top Contributors |Points Move| % Change | (%) | (%)
================================================================
RBC | 9.3240| 0.7| 26.5| 3.2
Brookfield Corp | 6.2110| 1.4| -58.1| 6.6
Enbridge | 5.8710| 0.8| -28.5| 3.7
TD Bank | -3.3820| -0.3| -39.0| -1.8
Agnico Eagle Mines | -3.3970| -1.5| -43.1| 4.1
Nutrien | -3.8420| -1.0| -52.1| 4.1
US
By Rita Nazareth
(Bloomberg) — A rally in stocks fizzled out after two Federal Reserve officials signaled that interest rates could top 5%, throwing some cold water on traders who saw a peak below that mark.
The S&P 500 failed to stay above the key 3,900 level, erasing an advance that reached almost 1.5%.
The Dow Jones Industrial Average underperformed, while the Nasdaq 100 rose thanks to gains in big tech, with Tesla Inc. surging about 6%.
The dollar and Treasury yields pared their declines.
Fed Bank of San Francisco President Mary Daly said she expects the central bank to raise rates to somewhere over 5%.
Her Atlanta counterpart Raphael Bostic noted that policymakers should hike above 5% by early in the second quarter and then go on hold for “a long time.”
Investors also awaited Thursday’s US CPI report that will come out almost a week after the latest jobs data showed that wage growth has decelerated.
The figures will be among the last such readings policymakers will see before their Jan. 31-Feb. 1 gathering.
“In addition to the probability of interest rates remaining high and a possible economic slowdown, any bullishness triggered by slowing inflation may be offset by stocks still-high valuations and overly optimistic earnings expectations,” said Chris Larkin at E*TRADE from Morgan Stanley. “It could be a recipe for choppy near-term and long-term trading.”
Morgan Stanley’s Michael Wilson said that while investors are generally pessimistic about the outlook for economic growth, corporate profit estimates are indeed still too high.
That suggests the S&P 500 could fall much lower than the 3,500 to 3,600 points the market is currently estimating in the event of a mild recession, the strategist said.
His counterparts at Goldman Sachs Group Inc. expect pressure on profit margins, changes to US corporate tax policies and the likelihood of a recession to overshadow the positive impact from China’s economic reopening.
“With all eyes on this week’s CPI report, corporate earnings season, and next month’s Fed meeting, we expect volatility to return,” said Mark Hackett, chief of investment research at Nationwide. “Investors should avoid overreacting to large market moves as elevated volatility is our new normal.”
Still, the rising threat of an economic recession has done nothing to dissuade Corporate America from spending big on its own shares.
American firms announced a record $1.26 trillion of buybacks in 2022, up 3% from a year ago, according to data compiled by Birinyi Associates.
In corporate news, Apple Inc.’s push to replace the chips inside its devices with homegrown components will include dropping a key Broadcom Inc. part in 2025.
Jefferies Financial Group Inc. said profit tumbled amid a persistent deal slump that looks poised to crimp a key profit engine across Wall Street.
Elsewhere, equities in developing nations entered a bull market amid a rally fueled by optimism over China’s reopening and a weakening dollar.
The MSCI Emerging Markets Index advanced 2.5% on Monday, taking its gains from an Oct. 24 low to over 20%. 
Key events this week:
* US wholesale inventories, Tuesday
* Fed Chair Jerome Powell among speakers at Riksbank symposium in Stockholm, Tuesday
* World Bank expected to release global economic prospects report, Tuesday
* ECB Governing Council members speak at Euromoney conference in Vienna, Wednesday
* US CPI, initial jobless claims, Thursday
* St Louis Fed President James Bullard at Wisconsin Bankers Association virtual event, Thursday
* Richmond Fed President Thomas Barkin speaks at VBA/VA Chamber, Thursday
* China trade, Friday
* US University of Michigan consumer sentiment, Friday
* Citigroup, JPMorgan Chase, Wells Fargo report earnings, Friday

Some of the main moves in markets:
Stocks
* The S&P 500 was little changed as of 4 p.m. New York time
* The Nasdaq 100 rose 0.6%
* The Dow Jones Industrial Average fell 0.3%
* The MSCI World index rose 0.7%
Currencies
* The Bloomberg Dollar Spot Index fell 0.6%
* The euro rose 0.8% to $1.0734
* The British pound rose 0.7% to $1.2182
* The Japanese yen rose 0.2% to 131.82 per dollar
Cryptocurrencies
* Bitcoin rose 1.5% to $17,206.51
* Ether rose 4% to $1,319.87
Bonds
* The yield on 10-year Treasuries declined three basis points to 3.53%
* Germany’s 10-year yield advanced two basis points to 2.23%
* Britain’s 10-year yield advanced five basis points to 3.53%
Commodities
* West Texas Intermediate crude rose 1.4% to $74.82 a barrel
* Gold futures rose 0.3% to $1,874.50 an ounce
This story was produced with the assistance of Bloomberg Automation.
–With assistance from Vildana Hajric, Isabelle Lee, Peyton Forte and Emily Graffeo.

Have a lovely evening.

Be magnificent!
As ever,

Carolann

Each person  must live their life as a model for others.  –Rosa Parks, 1913-2005.

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