July 26, 2023, Newsletter

Dear Friends,

Tangents:
July 26, 1963: Sitcom 2, the world’s first geosynchronous communications satellite is launched.  Part of NASA’s Sitcom program, it was responsible for transmitting the first TV signal from a geosynchronous satellite, a manmade satellite whose orbital period around the Earth matches the Earth’s rotation.

July 26, 1964: Teamsters president Jimmy Hoffa and six others were convicted of fraud and conspiracy in the handling of a union pension fund.  Go to article >>

Mick Jagger, musician, b. 1943.  OMG! Mick Jagger turns 80 years old today.
Aldous Huxley, writer, b. 1894
Carl Jung, psychoanalyst, b. 1875.
George Bernard Shaw, writer,  b. 1856.

The surprising list of actors who were up to play Ken in ‘Barbie’.  Ryan Gosling delivered all the “energy” one could ask for. But just for kicks, here are the other actors who might have gotten the role.

Gulf Stream current could collapse in 2025, plunging Earth into climate chaos: ‘We were actually bewildered’
Researchers have predicted the collapse of the AMOC could happen any time between 2025 and 2095 — far sooner than previous predictions, although not all scientists are convinced. Read More
PHOTOS OF THE DAY

London, UK
People visit Luke Jerram’s sculpture, Mars: War & Peace, a Model of the Red Planet, at the Kensington and Chelsea festival
Photograph: Raşid Necati Aslım/Anadolu Agency/Getty Images

Berlin, Germany
People visit the Devouring Lovers installation by the Spanish artist Eva Fàbregas at Hamburger Bahnhof National Gallery
Photograph: David Gannon/AFP/Getty Images

Albany, Australia
Volunteers try to help pilot whales after more than 50 died in a stranding on Cheynes Beach
Photograph: Western Australia Department of Biodiversity, Conservation and Attractions/AFP/Getty Images
Market Closes for July 26^th, 2023

International Markets

Bonds

Currencies

Commodities

Market Commentary:
📈 On this day in 1786, the earliest known U.S. stock and bond tables were published in the Massachusetts Centinel.
Canada
By Bloomberg Automation
(Bloomberg) — The S&P/TSX Composite advanced slightly to 20,561.64 in Toronto.
The move follows the previous session’s decrease of 0.1%.
Canadian Pacific Kansas City Ltd. contributed the most to the index gain, increasing 1.7%.
Tilray Brands Inc. had the largest increase, rising 15.9%.
Today, 123 of 228 shares rose, while 99 fell; 6 of 11 sectors were higher, led by financials stocks.
Insights
* This month, the index rose 2%
* The index advanced 8.4% in the past 52 weeks. The MSCI AC Americas Index gained 16% in the same period
* The S&P/TSX Composite is 1.4% below its 52-week high on Feb. 2, 2023 and 15% above its low on Oct. 13, 2022
* The S&P/TSX Composite is up 0.3% in the past 5 days and rose 5% in the past 30 days
* S&P/TSX Composite is trading at a price-to-earnings ratio of 13.4 on a trailing basis and 14.5 times estimated earnings of its members for the coming year
* The index’s dividend yield is 3.3% on a trailing 12-month basis
* S&P/TSX Composite’s members have a total market capitalization of C$3.25t
* 30-day price volatility little changed to 10.05% compared with 10.05% in the previous session and the average of 10.78% over the past month
================================================================
| Index Points | |Sector Name | Move | % Change | Adv/Dec
================================================================
Financials | 21.0089| 0.3| 22/7
Industrials | 17.8979| 0.6| 18/8
Energy | 6.7520| 0.2| 24/14
Consumer Discretionary | 3.5857| 0.4| 10/3
Health Care | 1.7360| 3.0| 2/2
Real Estate | 1.4882| 0.3| 16/5
Utilities | -0.8851| -0.1| 7/9
Communication Services | -1.5697| -0.2| 1/4
Consumer Staples | -7.5346| -0.9| 3/8
Materials | -10.9977| -0.4| 19/29
Information Technology | -21.3762| -1.3| 1/10
================================================================
| | |Volume VS| YTD| Index | | 20D AVG | Change Top Contributors |Points Move|% Change | (%) | (%)
================================================================
Canadian Pacific Kansas | 11.7200| 1.7| 55.6| 9.8
TD Bank | 9.8610| 0.9| -46.5| -1.9
Rogers Communications | 4.3400| 2.8| 72.5| -4.0
Teck Resources | -5.8390| -3.2| 56.7| 9.9
Constellation Software| -6.4540| -1.7| 6.5| 33.7
CGI Inc | -8.9360| -4.5| 196.6| 10.8
================================================================
| | Index |Volume VS | YTD| | Points | 20D AVG | Change Biggest Gainers | % Change | Move | (%) | (%)
================================================================
Tilray Brands | 15.9| 1.5590| 335.9| -30.5
MAG Silver | 10.5| 0.9990| 149.7| -22.6
TFI International | 4.3| 3.8500| 85.5| 25.0
================================================================
| |Index Points| Volume VS |YTD Change Biggest Losers | % Change | Move |20D AVG (%)| (%)
================================================================
CGI Inc | -4.5| -8.9360| 196.6| 10.8
Teck Resources | -3.2| -5.8390| 56.7| 9.9
George Weston | -2.7| -1.8710| 44.7| -9.2
US
By Rita Nazareth
(Bloomberg) — There was something for every Wall Street bull and bear in Jerome Powell’s remarks Wednesday, but the market finished the day betting the Federal Reserve’s next move will possibly be a skip.
Two-year US yields dropped alongside the dollar.
Stocks rebounded from session lows, with the Dow Jones Industrial Average notching its 13th straight advance — the longest winning run since 1987.
In late trading, Facebook parent Meta Platforms Inc. climbed after projecting revenue that beat estimates while eBay Inc. fell on a disappointing profit outlook.
The Fed raised rates by 25 basis points to the highest level in 22 years, and Powell said further hikes will be “data dependent” as officials fine-tune their effort to further quell inflation.
Swaps referencing future decisions priced in slightly lower odds of another increase this year, which ebbed to 47%.
Comments:
Rajeev Sharma, managing director of fixed income at Key Private Bank:
“In our opinion, the rate hiking cycle is done and the Fed will now pause for the rest of the year. The latest market reaction also supports this thesis with yields dipping slightly across the front end of the yield curve.”
Frances Donald, global chief economist at Manulife Investment Management:
“We now believe that the Fed is on a prolonged ‘hawkish hold’. In our base case, their next move will likely be a cut but it will take until 2024 until we see it. That said, Powell will have no choice but to keep the threat of hikes alive, lest he encourage markets to prematurely price in cuts and reignite inflation expectations.”
Chris Zaccarelli, chief investment officer for Independent Advisor Alliance:
“Bears can point to Powell’s insistence that all meetings are live and that core inflation is ‘pretty elevated,’ and bulls can point to Powell’s insistence that they could easily skip the next meeting and keep rates unchanged in September.”
Seema Shah, chief global strategist at Principal Asset Management:
“While the statement is a yawner, the broad signal is of a Fed that considers each monetary policy meeting as ‘live’. Data dependence remains the buzzword and, given the confusing signals of waning inflation but a tight labor market, keeping all options on the table seems to be a sensible approach.”
Edward Moya, senior market analyst for the Americas at Oanda:
“The Fed is keeping optionality for future rate increases, but it probably won’t need them. The disinflation process will remain as the economy is weakening, and the corporate world should start feeling the impact of tighter credit conditions.”
Preston Caldwell, chief US economist at Morningstar:
“We expect today’s meeting to be the Fed’s final rate hike.  Even with economic growth showing no signs yet of slowing to the below-trend growth rate usually needed to cause broad-based disinflationary pressure in the economy, inflation is nevertheless showing signs of abating due to relaxing of supply side constraints. As such, we expect the Fed to pause on rate hikes in its final three meetings of 2023.”
Jon Maier, chief investment officer at Global X:
“Now, it looks like the Fed might be closing in on the end of its current cycle of rate hikes. But they’re not painting themselves into a corner – they’re keeping an option open for another possible rate increase later this year. It shows they’re staying flexible and ready to respond to any economic twists and turns that might come up.”
David Russell, vice president of Market Intelligence at TradeStation:
“The Fed is in wait-and-see mode. They’re going to get two more months of employment and inflation data before the September meeting, so there’s no reason to make any changes now.  Investors can now put this behind them and get back to earnings.”
Another driver of trading Wednesday was the large batch of earnings reports, with results from big tech being highly scrutinized after the shares notched a historic advance in the first six months of the year.
Google parent Alphabet Inc. climbed to a 15-month high as revenue beat expectations, while Microsoft Corp. fell the most since January on a tepid sales growth and Texas Instruments Inc.’s lukewarm forecast weighed on chipmakers.
“Big tech earnings have been very Darwinian, and investors are only rewarding the companies that truly post strong results,” David Bahnsen, chief investment officer at the Bahnsen Group. “After extreme gains so far this year in big tech stocks, we have now moved to a phase where each company’s stock price is very non-correlated to one another.”

Corporate Highlights
* Boeing Co. rose after generating $2.58 billion in free cash flow in the second quarter, far exceeding expectations, amid a flurry of jet deliveries.
* Regional banks climbed as news that PacWest Bancorp is being bought by Banc of California bolstered confidence in the industry. Wells Fargo & Co. paced gains in larger lenders on plans to repurchase as much as $30 billion of its shares.
* Rail giant Union Pacific Corp. advanced after appointing Jim Vena as its new chief executive officer. Retailer Gap Inc. gained after naming Mattel Inc.’s Richard Dickson as its next CEO.
* Coca-Cola Co. rose after raising its full-year guidance after second-quarter results show continued momentum and consumer willingness to pay higher prices to quench their thirst with the company’s sugary sodas, fruit juices and sports drinks.
* AT&T Inc. advanced on profit and free cash flow that topped analysts’ estimates, offering a brighter picture as the phone giant faces a challenging restructuring effort, a heavy debt load and the potentially high costs of cleaning lead out of its old copper phone network.
* Visa Inc. posted card-spending growth that was more robust than Wall Street expected as consumer demand for travel and dining out remained strong last quarter.
* Snap Inc. fell after projecting revenue at the lower end of analysts’ estimates for this quarter, signaling that improvements to the digital advertising business are taking

Key events this week:
* China industrial profits, Thursday
* ECB rate decision, Thursday
* US GDP, durable goods orders, initial jobless claims, wholesale inventories, Thursday
* Japan Tokyo CPI, Friday
* BOJ rate decision, Friday
* Eurozone economic confidence, consumer confidence, Friday
* US consumer income, employment cost index, University of Michigan consumer sentiment, 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 fell 0.4%
* The Dow Jones Industrial Average rose 0.2%
* The MSCI World index was little changed
Currencies
* The Bloomberg Dollar Spot Index fell 0.3%
* The euro rose 0.4% to $1.1095
* The British pound rose 0.3% to $1.2946
* The Japanese yen rose 0.5% to 140.25 per dollar
Cryptocurrencies
* Bitcoin rose 0.6% to $29,411.02
* Ether rose 0.6% to $1,873.36
Bonds
* The yield on 10-year Treasuries declined three basis points to 3.86%
* Germany’s 10-year yield advanced six basis points to 2.48%
* Britain’s 10-year yield advanced one basis point to 4.28%
Commodities
* West Texas Intermediate crude fell 0.9% to $78.93 a barrel
* Gold futures rose 0.6% to $2,015.30 an ounce
This story was produced with the assistance of Bloomberg Automation.
–With assistance from Brett Miller, Tassia Sipahutar, Sujata Rao, Emily Graffeo, Isabelle Lee and Michael Mackenzie

Have a lovely evening.

Be magnificent!
As ever,

Carolann
Power does not corrupt men; fools, however, if they get into a position of power, corrupt power. –George Bernard Shaw, 1856-1950.

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