June 20, 2016 Newsletter
Dear Friends,
Tangents:
Summer Solstice today!
In summer, the song sings itself. –William Carlos Williams
Sumer is icumen in,
Lhude sing cuccu!
Groweth sed, and bloweth me [meadow]
And springeth the wude nu.
Anonymous, Cuckoo Song (c. 1250)
SUMMER TIME: The idea of making fuller use of the hours of daylight by advancing the clock originated with Benjamin Franklin (1706-90), but its introduction was due to its advocacy from 1907 by William Willett (1856-1915), a Chelsea builder. It was adopted in 1916 in Germany, then in Britain as a wartime measure, when clocks were advanced by one hour. In Britain it became permanent by an Act of 1925. Summer Time began on the day following the third Saturday in April, unless that was Easter Day, in which case it was the day following the second Saturday in April. It ended on the day following the first Saturday in October. In 1961 Summer Time was extended by six weeks, beginning March and ending in October, and similar extensions were made in 1962 and subsequent years. During the Second World War it ran from 25 February to 31 December in 1940 and from 1 January in the four years from 1941. In 1945 it ended in October. Double Summer Time (i.e. two hours in advance of GMT instead of one) was in force from 1941 to 1945 and in 1947 to save fuel. After the war Summer Time was in force in the years from 1948 to 1952 and 1961 to 1964. From 27 October 1968 until 31 October 1971 clocks were kept one hour ahead of GMT continuously. This was known as British Standard Time (BST). The most recent legislation is the Summer Time Act of 1972, which enacted that Summer Time should begin at 2 o’clock GMT in the morning of the day after the third Saturday in March or, if that is Easter Day, the day after the second Saturday in March and that it should end at 2 o’clock GMT in the morning of the day after the fourth Saturday in October. Since the Second World War a number of other countries have adopted some form of Summer Time. –Brewer’s Dictionary of Phrase & Fable.
June 20:
1837 – Queen Victoria ascends throne at age 18 after the death of her uncle, William IV.
PHOTOS OF THE DAY
The full moon rises behind a tree next to the ancient marble Temple of Poseidon at Cape Sounion, southeast of Athens, on the eve of the summer solstice on Monday. The temple, built in 444 BC, was dedicated to Poseidon, god of the sea. Petros Giannakouris/AP
A close-up of the head of ‘Cyber Horse,’ made from thousands of infected computer and cell phone bits, is on display at the entrance to the annual Cyberweek conference at Tel Aviv University in Israel on Monday. Amir Cohen/Reuters
A man jumps over a puddle outside Victoria Station as heavy rain falls in London on Monday. Monday marks the Summer Solstice – the longest day of the year and the astronomical change of seasons when days are longest and nights are shortest in the Northern Hemisphere. Lauren Hurley/PA/AP
Market Closes for June 20th, 2016
Market
Index |
Close | Change |
Dow
Jones |
17804.87 | +129.71
+0.73% |
S&P 500 | 2083.25 | +12.03
+0.58% |
NASDAQ | 4837.215 | +36.876
+0.77% |
TSX | 14015.14 | +113.37
|
+0.82%
|
International Markets
Market
Index |
Close | Change |
NIKKEI | 15965.30 | +365.64
|
+2.34%
|
||
HANG
SENG |
20510.20 | +340.22
|
+1.69%
|
||
SENSEX | 26866.92 | +241.01
|
+0.91%
|
||
FTSE 100 | 6204.00 | +182.91
|
+3.04%
|
Bonds
Bonds | % Yield | Previous % Yield |
CND.
10 Year Bond |
1.206 | 1.122 |
CND.
30 Year Bond |
1.838 | 1.768 |
U.S.
10 Year Bond |
1.6783 | 1.6095 |
U.S.
30 Year Bond |
2.4866 | 2.4203 |
Currencies
BOC Close | Today | Previous |
Canadian $ | 0.78099 | 0.77588
|
US
$ |
1.28043 | 1.28886 |
Euro Rate
1 Euro= |
Inverse | |
Canadian $ | 1.44876 | 0.69025
|
US
$ |
1.13146 | 0.88381 |
Commodities
Gold | Close | Previous |
London Gold
Fix |
1281.80 | 1290.70 |
Oil | Close | Previous |
WTI Crude Future | 49.37 | 47.98
|
Market Commentary:
Canada
By Anna-Louise Jackson and Bailey Lipschultz
(Bloomberg) — Canadian stocks advanced the most in five weeks, joining a rally in global equities, as energy producers followed crude higher and financial shares had their best gains in a month.
The S&P/TSX Composite Index rose 0.8 percent percent to 14,015.14 at 4 p.m. in Toronto, the most since May 16, with all 10 main industries in the benchmark gaining. The gauge rebounded after falling for second straight week, down 1 percent. A report in Canada showed wholesale sales rose 0.1 percent in April, less than the 0.5 percent forecast.
Global equities surged, with the pound strengthening the most since 2008, on signs the campaign for the U.K to stay in the European Union was gaining momentum before this week’s referendum. Canadian stocks have climbed 7.7 percent this year, second only among developed nations to New Zealand’s 8.6 percent gain.
Energy companies rallied with oil as West Texas Intermediate crude futures traded above $49 a barrel. Enbridge Inc. rose 2.2 percent, while Cenovus Energy Inc. added 3.1 percent. Crew Energy Inc. and Baytex Energy Corp. posted the strongest gains, up more than 6.6 percent.
Financial stocks added 0.7 percent, the most since May 24. Alaris Royalty Corp. jumped 4.4 percent and Great-West Lifeco Inc. rose 2.4 percent, the best for both in four months. Brookfield Asset Management Inc. fell 0.3 percent after the company said it has completed the spin off of Business Partners LP. The company’s private equity arm tumbled 18 percent in its first regular trading session.
Technology companies gained 0.8 percent, with Kinaxis Inc. adding 3.5 percent, its biggest rally in a month. Open Text Corp. increased 2.8 percent, snapping a four-day decline of 1.6 percent.
Raw-materials companies rallied 0.3 percent, even as gold prices slipped for a second straight day. First Quantum Minerals Ltd. and Lucara Diamond Corp. both added at least 4.8 percent. Kinross Gold Corp. fell 2.2 percent as the company temporarily suspends mining and processing operations at its Tasiast mine in Mauritania. Barrick Gold Corp. lost 2 percent and fell for a third day.
US
By Oliver Renick
(Bloomberg) — U.S. stocks climbed, with the S&P 500 Index rising the most in almost four weeks, after the latest polls showed the U.K. campaign to remain in the European Union is gaining ground before Thursday’s referendum.
Monday’s rebound was paced by gains in consumer discretionary, industrial and technology shares. Amazon.com Inc. and Priceline Group Inc. advanced more than 1 percent to bolster consumer companies. Banks moved higher amid a steep increase in Treasury yields as investors abandoned haven assets, with Bank of America Corp. and Goldman Sachs Group Inc. up more than 1 percent.
The S&P 500 rose 0.6 percent to 2,083.25 at 4 p.m. in New York, though it trimmed gains in the final hour before the looming U.K. vote and testimony tomorrow by Federal Reserve Chair Janet Yellen. The gauge had climbed as much as 1.4 percent. The Dow Jones Industrial Average rallied 129.71 points, or 0.7 percent, to 17,804.87. The Nasdaq Composite Index increased 0.8 percent, recovering from the lowest since May 23.
“We’re kind of going back to that risk-on again — it’s more an unwind of the panic we saw last week in the VIX up at 22 and the bond buying, and it seems to be because of what’s changing in the vote,” Mark Kepner, a managing director and equity trader at Themis Trading LLC in Chatham, New Jersey, said by phone. “The market was starting to prepare for a Brexit and it seems the polls in the U.K have changed since late last week.”
A poll published over the weekend showed 45 percent of voters supported the ‘Remain’ camp, while 42 percent were in favor of a so-called Brexit — a turnaround from early last week, when a slew of surveys put the latter group ahead. Odds at betting shops also suggested dwindling support for the ‘Leave’ camp following Thursday’s murder of U.K. lawmaker Jo Cox, who backed staying in the EU.
The S&P 500 bounced Monday after falling in six of the past seven sessions, a stretch that followed a climb to within 0.6 percent of its all-time high on June 8. The benchmark posted its worst weekly retreat since April amid global anxiety that Britain will choose to secede and central banks’ efforts to boost growth are losing their potency.
Valuations stuck above the three-year average and four quarters of falling profits have also added to the recent hurdles for stocks. The S&P 500 briefly sprang back near 2,100 today, a level that’s proved difficult to hold above in other rallies during the past year, and closed 2.2 percent from its record set 13 months ago.
The CBOE Volatility Index fell 5.4 percent today to 18.37, paring an early drop of nearly 15 percent. The measure of market turbulence known as the VIX capped a third consecutive weekly climb on Friday, the longest in five months. About 6.7 billion shares traded hands on U.S. exchanges, 3 percent below the three-month average.
The Fed last week signaled a cautious approach to future rate increases, scaling back its projections for the next two years. Yellen and her fellow policy makers reiterated rates are likely to rise at a “gradual” pace. The Fed chair will testify on monetary policy before lawmakers Tuesday and Wednesday in a semiannual report. Traders have cut back their bets on higher borrowing costs, pricing in less than even odds for an increase as late as February 2017.
“Last week, the positioning got a little bit too bearish, and now we are seeing a readjustment of that,” said Michael Hewson, a market analyst at CMC Markets in London. “People are talking about the slight shift in the betting odds with respect to this week’s U.K. vote. Brexit is a risk, but is it going to bring the global economy crashing down? No. When you get stretched too far in one direction, don’t be surprised it’s like an elastic band — you pull it, pull it, pull it, and it snaps.”
Among the S&P 500’s 10 main industries Monday, energy, industrial and consumer discretionary shares rose at least 0.8 percent, while technology and financial companies added more than 0.5 percent. Utilities slipped 0.4 percent, shaving an earlier 1.1 percent drop.
Auto-parts makers were the biggest gainers in consumer discretionary, with Delphi Automotive Plc and BorgWarner Inc. climbing more than 3.7 percent, the best for both since April. Federal-Mogul Holdings Corp. jumped as much as 9 percent after Carl Icahn raised his bid for the remaining 18 percent of the parts maker.
Travel-related companies surged, with Expedia Inc. joining Priceline and TripAdvisor Inc. with increases of more than 2.5 percent following an upgrade to the equivalent of buy from neutral at Atlantic Equities LLC. Royal Caribbean Cruises Ltd. and Carnival Corp. added at least 1.4 percent. A Wells Fargo analyst said cruise lines have underperformed amid concerns over the Brexit referendum, and are the best way in the leisure industry to play a “stay” vote.
Boeing Co. advanced 2.3 percent toward a five-week high, contributing to industrials’ longest rally in two months. The aircraft maker is nearing a $4 billion deal with Russia’s largest air-freight company that would help extend the life of the iconic, hump-nosed 747 jumbo jet, people close to the transaction said. General Electric Co. and 3M Co. added at least 1.2 percent. FedEx Corp. gained 1.4 percent. The delivery company said it will buy six Boeing 767 freighters valued at $1.2 billion.
Technology shares rose 0.5 percent, cutting the day’s best gains by two-thirds. Semiconductors were the strongest members of the group, rallying the most since May 24, with Skyworks Solutions Inc. and Qorvo Inc. rallying more than 2.7 percent. Intel Corp. advanced 1.3 percent. Also among tech companies, EBay Inc. jumped 3.3 percent, its best one-day gain in 10 weeks.
Among stocks moving on corporate news, Marathon Oil Corp. soared 10 percent, its greatest gain in two months after saying it will buy PayRock Energy Holdings for $888 million. Marathon’s climb led energy producers as West Texas Intermediate crude futures increased as much as 2.9 percent amid speculation the U.K. will vote to remain in the EU. Chevron Corp. added 1 percent and Devon Energy Corp. climbed 3.7 percent.
WellCare Health Plans Inc. rose to its highest since October 2007, with its 3.6 percent increase helping to boost the Russell 2000 Index to its best day in nearly a month. The climb comes after a Wall Street Journal report said Justice Department officials may be questioning the merger of Anthem Inc. and Cigna Corp., making WellCare a potential target. Rival managed-care companies Centene Corp. and Molina Healthcare Inc. Advanced at least 1.9 percent.
Have a wonderful evening everyone.
Be magnificent!
When you have an ideal will you think it helps rid you of “what is,” but it never does.
You may preach non-violence for the rest of your life
and all the time be sowing the seeds of violence.
Krishnamurti
As ever,
Carolann
He hath awakened from the dream of life-
‘tis we, who lost in stormy visions, keep
with phantoms an unprofitable strife.
-Percy Bysshe Shelley, 1792-1822
Carolann Steinhoff, B.Sc., CFP®, CIM, CIWM
Portfolio Manager &
Senior Vice-President
Queensbury Securities Inc.,
St. Andrew’s Square,
Suite 340A, 730 View St.,
Victoria, B.C. V8W 3Y7