July 21, 2022 Newsletter

Dear Friends,

Tangents: Happy Friday Eve.
July 21, 1983: The world’s lowest recorded temperature, -128.6 ͦF (-89.2 ˚C), is measured at Vostok Station, Antarctica.
2002: Telecommunications giant WorldCom Inc. filed for bankruptcy protection after disclosing it had inflated profits by nearly $4 billion through deceptive accounting. Go to article »

Federal agents seize what could be a priceless Faberge egg from a Russian oligarch’s yacht. (h/t Ellen Kominers)

How to recover from burnout.

This designer is turning balloons into fine furniture.  These inflatable furnishings look like they could pop or fall apart with the slightest bit of weight, but surprisingly, they’re quite sturdy.

PHOTOS OF THE DAY

A cyclist shows off his skills during the BMX Day celebration in Santiago
CREDIT: Alberto Valdés/EPA

A giant interactive gorilla sculpture is unveiled in Bristol Zoo gardens
CREDIT: Andrew Matthews/PA

Visitors enjoy the views from Canton Tower in Guangdong province. The main body of Canton tower is 454 meters high, the antenna pole is 146 meters high, and the total height is 600 meters. It is the second tallest tower in China and the third tallest in the world
CREDIT: Anadolu Agency/Getty Images

Market Closes for July 21st, 2022

International Markets

Bonds

Currencies

Commodities

Market Commentary:
On this day in 1933, Wall Street began to digest the implications of President Franklin D. Roosevelt’s “New Deal,” including the Glass-Steagall Act, enacted just over one month earlier. The Dow Jones Industrial Average suffered its ninth-worst daily percentage loss, dropping 7.8%.
Canada
By Bloomberg Automation
(Bloomberg) — The S&P/TSX Composite rose for the fifth day, climbing 0.2%, or 42.18 to 19,062.85 in Toronto.
The index advanced to the highest closing level since July 7.
Shopify Inc. contributed the most to the index gain, increasing 4.8%. Mullen Group Ltd. had the largest increase, rising 11.8%.
Today, 149 of 238 shares rose, while 86 fell; 8 of 11 sectors were higher, led by industrials stocks.
Insights
* This month, the index rose 1.1%
* So far this week, the index rose 3.6%, heading for the biggest advance since the week ended Feb. 5
* The index declined 5.2% in the past 52 weeks. The MSCI AC Americas Index lost 10% in the same period
* The S&P/TSX Composite is 14.2% below its 52-week high on April 5, 2022 and 4.9% above its low on July 14, 2022
* The S&P/TSX Composite is up 4% in the past 5 days and fell 1% in the past 30 days
* S&P/TSX Composite is trading at a price-to-earnings ratio of 14.9 on a trailing basis and 11.7 times estimated earnings of its members for the coming year
* The index’s dividend yield is 3.1% on a trailing 12-month basis
* S&P/TSX Composite’s members have a total market capitalization of C$3.05t
* 30-day price volatility fell to 20.43% compared with 20.52% in the previous session and the average of 19.78% over the past month
================================================================
| Index Points | |
Sector Name | Move | % Change | Adv/Dec
================================================================
* Industrials | 30.5260| 1.3| 22/7
* Information Technology | 26.8573| 2.4| 14/0
* Financials | 14.3878| 0.2| 22/7
* Real Estate | 6.2633| 1.2| 21/1
* Materials | 5.8784| 0.3| 37/13
* Consumer Discretionary | 3.3804| 0.5| 10/3
* Utilities | 2.7152| 0.3| 7/9
* Consumer Staples | 1.2145| 0.2| 6/5
* Communication Services | -1.9795| -0.2| 4/3
* Health Care | -2.1466| -2.6| 2/5
* Energy | -44.9228| -1.3| 4/33
================================================================
| | |Volume VS |
| Index | | 20D AVG |YTD Change
Top Contributors |Points Move| % Change | (%) | (%)
================================================================
* Shopify | 18.6500| 4.8| 93.3| -70.1
* Canadian Pacific | 9.8050| 1.6| -32.2| 4.8
* Canadian National | 6.3910| 1.1| -25.6| -3.9
* Intact Financial | -5.0320| -2.3| 21.1| 8.7
* Canadian Natural Resources | -6.4440| -1.2| -45.7| 21.5
* Suncor Energy | -6.9160| -1.7| -11.5| 27.6
US
By Stephen Kirkland
(Bloomberg) — Stocks rose amid a rally in mega caps as strength in the corporate sector buoyed investor sentiment.
Treasuries gained as data pointed to weakness in the US economy.
The S&P 500 posted its biggest three-day gain since May 27, led by tech and consumer discretionary stocks.
Tesla Inc. topped the leaderboard after its quarterly results beat estimates, with Apple Inc. and Amazon.com Inc. also pushing higher ahead of earnings due next week.
Stocks briefly hit session lows in morning trading on news of US President Joe Biden testing positive for Covid.
Treasury yields dropped, with the 10-year rate sinking 12 basis points to 2.90% after a knee-jerk move higher following the European Central Bank’s greater-than-expected rate hike.
Data showing a rise in jobless claims suggested softening in the labor market, while the Philadelphia-area manufacturers’ outlook for business conditions slumped to the lowest since 1979 and the Conference Board’s leading economic index fell more than estimated.
Markets were buffeted in early trading after the ECB hiked rates by 50 basis points, the first increase in 11 years and biggest since 2000.
It comes as a brewing political crisis in Italy ramps up the pressure on the ECB to shield the most vulnerable eurozone members from market speculation through a new crisis management tool.
The euro initially climbed on the decision before paring those gains against the dollar.
“There’s enough circuit breakers in the market, particularly when you think about the strength of the consumer, the strength of the corporate sector and how well telegraphed this potential recession has been,” Stephen Parker, head of advisory solutions at JPMorgan Private Bank, said on Bloomberg TV. “Because of that, a lot of that pain has already been felt by markets.”
The S&P 500 has climbed more than 9% from a multi-year trough in mid-June amid earnings optimism and speculation the Federal Reserve will take a more measured approach to tightening policy.
Whether the market has bottomed remains open to debate, but over the past month yields have fallen and rates markets have discarded bets for a full percentage point hike when the Fed meets next week.
Still, sentiment remains fragile amid accelerating inflation and the prospect of a steep downturn in global economies as well as the geopolitical risks, notably in Europe.
The resumption of Russian gas exports to the region through Nord Stream could provide some relief for the continent that’s racing to store the fuel before the winter. 
More market commentary:
* “This is where we are, this is the world we live in, where  there is going to be daily volatility like this,” Megan Horneman, CIO at Verdence Capital Advisors, said by phone. “The market is still trying to figure out where to go. We don’t know, from an inflation standpoint, we don’t know how far the Fed is going to have to go, the ECB is now getting quite aggressive.”
* “The ECB did what’s needed, but let’s be clear – they have no good options,’ said James Athey, investment director at Abrdn.  “The stagflation trade-off they face is horrible, the worst error they could make is to allow inflation to become unhinged.  But dealing with inflation clearly hurts growth. Either way, equities aren’t a great investment.”

Some of the main moves in markets:
Stocks
* The S&P 500 rose 1% as of 4 p.m. New York time
* The Nasdaq 100 rose 1.4%
* The Dow Jones Industrial Average rose 0.5%
* The MSCI World index rose 0.8%
Currencies
* The Bloomberg Dollar Spot Index fell 0.2%
* The euro rose 0.3% to $1.0211
* The British pound was little changed at $1.1979
* The Japanese yen rose 0.5% to 137.55 per dollar
Bonds
* The yield on 10-year Treasuries declined 12 basis points to 2.90%
* Germany’s 10-year yield declined three basis points to 1.22%
* Britain’s 10-year yield declined nine basis points to 2.05%
Commodities
* West Texas Intermediate crude fell 3.5% to $96.36 a barrel
* Gold futures rose 1% to $1,734.60 an ounce
–With assistance from Tassia Sipahutar, Denitsa Tsekova, Sagarika Jaisinghani, Natalia Kniazhevich, Emily Graffeo and Vildana Hajric.
Have a lovely evening.

Be magnificent!
As ever,

Carolann
Procrastination makes easy things hard, hard things harder. – Mason Cooley, 1927-2002.

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