July 10th, 2023 Newsletter

Dear Friends,

Tangents: Happy Monday.

July 10, 1943: U.S. and British forces invaded Sicily during World War II.  Go to article >>
1985: Rainbow Warrior sunk, Greenpeace.

John Calvin, founder of Presbyterianism, b. 1509.
James M. Whistler, artist, b. 1834.
Marcel Proust, b. 1871.
Arthur Ashe, tennis player, b. 1943.

Kentucky man finds over 700 Civil War-era coins buried in his cornfield
The “Great Kentucky Hoard” includes hundreds of U.S. gold pieces dating to between 1840 and 1863, in addition to a handful of silver coins. Read More

Time moved ‘5 times slower’ in the early universe, mind-bending black hole study reveals
Astronomers have peered back to the dawn of the cosmos to observe time ticking five times more slowly in the early universe than it does now. Read More

Did Alexander the Great have any children?
Alexander the Great died at age 32, leaving behind a vast empire. Did he have any heirs to rule in the power vacuum that followed his death? Read More

Did the Cambrian explosion really happen?
Was there really a dramatic burst of biodiversity on Earth 540 million to 520 million years ago? Read More

See what Elton John told fans at his final concert.  The legendary artist has officially entered retirement. Listen to the heartfelt message he gave to his fans.

Construction workers unearth ‘intact’ marble head in Rome.  “Roma continues to return precious evidence of its past,” the city’s mayor said after this marble head was discovered during construction.

Happiness is beneficial for the body, but it is grief that develops the powers of the mind. -Marcel Proust, 1871-1922.
PHOTOS OF THE DAY

Chernihiv, Ukraine: Women wearing traditional Ukrainian costume take part in Kupala night celebrations after volunteering to clear debris from destroyed buildings Photograph: Genya Savilov/AFP/Getty Images

Kars, Turkey: A ladybird on a leaf after a rain shower Photograph: Anadolu Agency/Getty Images

Kurume, Japan: People wade through a street during heavy rain in Fukuoka prefecture. Torrential rain has been pounding south-western Japan, triggering floods and mudslides.  Photograph: Kyodo News/AP
Market Closes for July 10^th, 2023

International Markets

Bonds

Currencies

Commodities

Market Commentary:
📈 On this day in 1991, Borland International created a “software powerhouse” by buying Ashton-Tate for $440 million. Analysts said Borland had “the dominant position in database software for personal computers.” Microsoft’s Bill Gates said, “My largest concern about price competition comes from Borland.” Over the next three years, Borland stock lost three-quarters of its value.
Canada
By Bloomberg Automation
(Bloomberg) — The S&P/TSX Composite declined slightly to 19,822.45 in Toronto.
The move follows the previous session’s increase of 0.1%.
Today, financials stocks led the market lower, as 5 of 11 sectors lost; 88 of 229 shares fell, while 137 rose.
Nutrien Ltd. contributed the most to the index decline, decreasing 2.5%.
Quebecor Inc. had the largest drop, falling 4.3%.
Insights
* The index advanced 4.2% in the past 52 weeks. The MSCI AC Americas Index gained 12% in the same period
* The S&P/TSX Composite is 4.9% below its 52-week high on Feb. 2, 2023 and 10.9% above its low on Oct. 13, 2022
* The S&P/TSX Composite is down 1.7% in the past 5 days and fell 0.3% in the past 30 days
* S&P/TSX Composite is trading at a price-to-earnings ratio of 12.9 on a trailing basis and 13.7 times estimated earnings of its members for the coming year
* The index’s dividend yield is 3.5% on a trailing 12-month basis
* S&P/TSX Composite’s members have a total market capitalization of C$3.14t
* 30-day price volatility fell to 11.48% compared with 11.51% in the previous session and the average of 11.40% over the past month
================================================================
| Index Points | |
Sector Name | Move | % Change | Adv/Dec
================================================================
Financials | -18.1820| -0.3| 11/18
Communication Services | -13.4267| -1.6| 0/5
Utilities | -12.1851| -1.4| 0/16
Consumer Staples | -0.4620| -0.1| 5/6
Industrials | -0.4115| 0.0| 14/12
Information Technology | 0.6723| 0.0| 10/1
Consumer Discretionary | 1.0342| 0.1| 11/3
Health Care | 1.5323| 2.9| 2/2
Real Estate | 1.9790| 0.4| 12/9
Energy | 2.0420| 0.1| 26/12
Materials | 28.8276| 1.2| 46/4
================================================================
| | |Volume VS | YTD
| Index | | 20D AVG | Change
Top Contributors |Points Move| % Change | (%) | (%)
================================================================
Nutrien | -6.9750| -2.5| -25.5| -20.2
Constellation Software | -6.1390| -1.7| -22.8| 26.3
Enbridge | -5.2410| -0.8| 29.8| -9.3
Barrick Gold | 3.0700| 1.2| -38.5| -5.4
Franco-Nevada | 3.5030| 1.4| -30.4| 1.2
Agnico Eagle Mines | 4.8040| 2.2| -41.4| -6.7
US
By Rita Nazareth
(Bloomberg) — The stock market kicked off the week on a cautious note, with traders sifting through remarks from a slew of Federal Reserve speakers while awaiting key inflation data and the start of the earnings season.
Following a three-day slide in the S&P 500, the benchmark posted a small gain. The market didn’t get much support from the mega-cap space as Tesla Inc. fell almost 2% and Amazon.com Inc. dropped before its Prime Day event.
The Nasdaq 100, which notched a historic first half of a year amid the artificial-intelligence craze, will go through a “special rebalance.”
A gauge of big banks pared gains on news about a plan to boost capital requirements.
In the run-up to Wednesday’s consumer price index, the market got the latest thinking from a raft of policymakers.
Three Fed officials — Michael Barr, Mary Daly and Loretta Mester — said the central bank will need to raise interest rates further this year to bring inflation back to its 2% goal.
Meantime, Fed Bank of Atlanta President Raphael Bostic noted officials can be patient amid evidence of an economic slowdown.
Market momentum has slowed since equities notched a strong first-half rally as concern resurfaced about the impact of the many economic crosscurrents on corporate profits.
Morgan Stanley’s Michael Wilson became the latest to warn that earnings forecasts will matter more than usual this time around given elevated equity valuations, higher interest rates and dwindling liquidity.
“Many risks still lie ahead,” said Seema Shah, chief global strategist at Principal Asset Management. “With broad equity valuations having once again become stretched and market breadth extremely narrow, the market is priced for perfection — leaving it vulnerable to earnings disappointments.”
This is the fifth straight time that analysts are leaning bearish heading into the earnings season, and in each of the four prior periods, the news wasn’t nearly as bad as expected — spurring an average gain of over 6% for the S&P 500, according to Bespoke Investment Group.
“Will this earnings season finally be the quarter that proves analysts correct?,” the firm’s strategists said in a note. “If they stay negative every quarter, eventually they’ll be proven right, but betting against the market heading into earnings season recently proved to be an expensive ride.”
The earnings season kicks off in earnest on Friday, when JPMorgan Chase & Co., Citigroup Inc. and Wells Fargo & Co. report their numbers.
There’s more pain on the way for the S&P 500 as profit warnings and fears of higher interest rates combine to threaten the key US stock indicator, according to the latest Markets Live Pulse survey.
While earnings seasons have usually been positive for equities in the past decade, according to Deutsche Bank AG strategists, the upcoming one will hurt stocks, said 55% of the 346 MLIV respondents.
To Matt Maley at Miller Tabak + Co., it’s going to be harder for the market to rally if the earnings season is “not as bad as we thought” — especially since the market has become so  expensive.
This does not mean that if the guidance from companies is “just OK,” the market will sell off meaningfully, Maley added.
However, if corporate outlooks show any material disappointment, “it should create some serious headwinds for the stock market.”
The question is whether earnings can continue to bend without markets breaking, according to Saira Malik at Nuveen.
With analysts cutting earnings estimates in recent weeks, companies may once again find it easier to deliver stronger-than-expected results.
“We are cautious about the self-fulfilling optimism driven by these diminished expectations,” Malik noted. “Additionally, we’re mindful of mixed US economic data and the potential for two more rate hikes this year.”
In other corporate news, a gauge of US-listed Chinese shares climbed on news the Asian nation will extend policies to support the property market.
Icahn Enterprises LP soared as Carl Icahn renegotiated loan terms with a group of banks just months after a report by Hindenburg Research sent shares in his investment firm tanking.
Cava Group Inc. rallied as a majority of brokers initiated coverage on the fast-casual restaurant operator with buy-equivalent recommendations.
Key events this week:
* St. Louis Fed President James Bullard speaks, Tuesday.
* Canada rate decision, Wednesday.
* Bank of England Governor Andrew Bailey speaks, Wednesday.
* US CPI, Wednesday.
* Federal Reserve issues Beige Book, Wednesday.
* Fed speakers include Neel Kashkari, Loretta Mester, Raphael Bostic, Wednesday.
* China trade, Thursday.
* Eurozone industrial production, Thursday.
* US initial jobless claims, PPI, Thursday.
* US University of Michigan consumer sentiment, Friday.
* US banks kick off earnings, Friday.
Some of the main moves in markets:
Stocks
* The S&P 500 rose 0.2% as of 4 p.m. New York time
* The Nasdaq 100 was little changed
* The Dow Jones Industrial Average rose 0.6%
* The MSCI World index rose 0.3%
Currencies
* The Bloomberg Dollar Spot Index fell 0.2%
* The euro rose 0.3% to $1.0997
* The British pound rose 0.2% to $1.2863
* The Japanese yen rose 0.6% to 141.30 per dollar
Cryptocurrencies
* Bitcoin rose 2.3% to $30,889.97
* Ether rose 1.7% to $1,901.15
Bonds
* The yield on 10-year Treasuries declined six basis points to 4.00%
* Germany’s 10-year yield was little changed at 2.64%
* Britain’s 10-year yield declined one basis point to 4.64%
Commodities
* West Texas Intermediate crude fell 0.9% to $73.21 a barrel
* Gold futures were little changed
This story was produced with the assistance of Bloomberg Automation.
–With assistance from Brett Miller, Tassia Sipahutar, Robert Brand, Vildana Hajric, Isabelle Lee, Peyton Forte and Carly Wanna.
Have a lovely evening.

Be magnificent!
As ever,

Carolann
You can, you should, and if you’re brave enough to start, you will. –Stephen King, b. 1947.

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