July 11, 2018 Newsletter

Dear Friends,

Tangents:
July 11, 1804: Burr-Hamilton duel.

On July 11, 1979, the abandoned United States space station Skylab made a spectacular return to Earth, burning up in the atmosphere and showering debris over the Indian Ocean and Australia.
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PHOTOS OF THE DAY

A monster saltwater crocodile is bound on a trailer after it was captured near Katherine, Australia. Northern Territory Parks and Wildlife trapped the 600 kilograms (1,328 pounds) aquatic reptile only 30km (19 miles) downstream from Katherine Gorge, a major tourist attraction outside the Northern Territory town of Katherine. Credit: NT Department of Tourism and Culture.

The Santa Maria Manuela is pictured as Tall Ships Arrive at Sunderland Docks. Credit: Charlotte Graham for the Telegraph

A wild cow leaps over revellers after the fourth running of the bulls at the San Fermin festival in Pamplona, Spain. Credit: Joseba Etxaburu/Reuters

A man dressed as a Kiliki traditional figure stands next to a door at the San Fermin festival in Pamplona. Credit: Vincent West/Reuters
Market Closes for July 11^th, 2018

International Markets

Bonds

Currencies

Commodities

Market Commentary
Canada
By Kristine Owram
     (Bloomberg) — Canadian stocks slid as an escalating U.S.- China trade war sent crude and copper prices tumbling and battered commodity stocks.
     The S&P/TSX Composite Index lost 131 points or 0.8 percent to 16,417.32, its biggest drop in two and a half weeks. Materials stocks were the biggest decliners, falling 2.7 percent, the most since February. First Quantum Minerals Ltd. retreated 7.1 percent and Hudbay Minerals Inc. lost 5.6 percent amid weak prices for copper and other industrial metals.
     Energy stocks lost 1 percent as West Texas Intermediate prices fell 5 percent, the most in more than a year. Trade tensions overshadowed the biggest drop in U.S. crude inventories since 2016, a development that would normally be bullish for oil.
     In other moves:
                            Stocks
* West Fraser Timber Co. fell 4.5 percent as lumber futures declined, pressured by trade worries
* WeedMD Inc. tumbled 16 percent after Hiku Brands Co. canceled a planned acquisition, reaching a deal instead with Canopy Growth Corp. Hiku jumped 20 percent and Canopy rose 2.2 percent
* Martinrea International Inc. lost 4.2 percent, Linamar Corp. fell 2.6 percent and Magna International Inc. retreated 3.1 percent as trade fears weighed on auto suppliers
                           Commodities
* Western Canada Select crude oil traded at a $19.30 discount to WTI
* Gold fell 0.9 percent to $1,244.40 an ounce
                            FX/Bonds
* The Canadian dollar weakened 0.7 percent to C$1.3208 per U.S. dollar after the Bank of Canada hiked interest rates
* The Canada 10-year government bond yield fell 1 basis point to 2.14 percent
US
By Randall Jensen
     (Bloomberg) — U.S. stocks fell as crude plunged the most in two years and the dollar spiked higher amid renewed tensions over trade and geopolitics.
     The S&P 500 dropped the most in two weeks, as energy and material producers tumbled at least 2 percent on renewed angst that the Trump administration’s trade stance will damp demand for commodities. Oil’s retreat took West Texas crude toward $70 a barrel, while metals and crop futures also slid. Caterpillar Inc. and Chevron Corp. led losses in the Dow Jones Industrial Average, and emerging-market equities fell the most since the end of June.
     The dollar saw the biggest rise in a month, while the Japanese yen and Chinese offshore yuan dropped. Ten-year Treasury yields fell for the second day in a row.
     “We impose tariffs last night after the close and markets across the world are just wrecked,” George Maris, Janus Henderson’s co-head of equities, said in an interview at Bloomberg’s New York headquarters. “Over the prior three days we just had quiet and markets just were green across the board.  This is right now the critical issue confronting markets.”
     The newest salvo in the trade war shattered the momentary calm in the markets that had allowed investors to turn their focus to earnings and growth in the economy and sent the S&P 500 to the highest close since February. Investors continue to be caught in a push and pull between corporate results, which begin to pile in this week, and the growing specter of the trade war.
     These are some events to look out for this week:
* Earnings season gets into gear with JPMorgan Chase & Co. and Citigroup Inc. among the largest companies due to give results, as well as India’s Infosys Ltd.
* The most noteworthy U.S. data may be the June inflation report on Thursday, which consensus expects will show both headline and core price growth picking up. There’s another deluge of Treasury debt sales too, with a total $156 billion of notes and bills offered during the week.
* Chinese trade data due at the end of the week will probably show slightly slower export growth, after early indicators pointed to softer overseas demand and weaker export orders, Bloomberg Economics said.
     And here are the main market moves:
                            Stocks
* The S&P 500 Index sank 0.7 percent to 2,774.10 as of 4 p.m. New York time.
* The Dow Jones Industrial Index declined 0.7 percent, the largest slide since the end of June.
* The Stoxx Europe 600 Index fell 1.3 percent, the biggest tumble in more than two weeks.
* The Topix Index declined 0.8 percent to 1,701.88.
* Hong Kong’s Hang Seng Index fell 1.1 percent, the largest fall in more than a week.
                            Currencies
* The Bloomberg Dollar Spot Index gained 0.7 percent, most since June 14.
* The Japanese yen dropped 0.9 percent to 111.95 per dollar.
* The offshore yuan fell 1.1 percent to 6.7227 per dollar.
* The euro declined 0.6 percent at $1.1671.
                            Bonds
* The yield on 10-year Treasuries fell less than one basis point to 2.84 percent.
                            Commodities
* West Texas Intermediate crude dropped 4.7 percent to $70.67 a barrel, biggest decline since Feb. 9.
* Gold declined 1 percent to $1,242.59 an ounce.
–With assistance from Sarah Ponczek, Phil Kuntz and Samuel Potter. 

Have a great night.

Be magnificent!

As ever,

Carolann

He who undervalues himself is justly undervalued by others.
                                            -William Hazlitt, 1778-1830

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
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