June 4, 2018 Newsletter

Dear Friends,

Tangents:
On June 4, 1989, Chinese army troops stormed Tiananmen Square in Beijing to crush the pro-democracy movement; hundreds – possibly thousands – of people died.
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Socrates, b.  June 4, 470 BC
June 4, 1942: Battle of Midway.
PHOTOS OF THE DAY

People make their way in a boat past a figure of an owl on Altauseer lake near Bad Aussee, Austria. Credit: The Telegraph

People take pictures during an eruption of the Great Geysir in Geysir, Iceland. Credit: The Telegraph

Catholic faithful throw petals during a procession marking the Feast of Corpus Christi in Minsk, Belarus. Credit: The Telegraph

Young brothers Fergus and Archie Baillie help police a vintage Mini Cooper at The BVAC Classic at Thirlestane Castle, Scotland. Credit: The Telegraph
Market Closes for June 4^th, 2018

International Markets

Bonds

Currencies

Commodities

Market Commentary:
$~ On this day in 1896, at approximately 4 a.m., Henry Ford unveiled his “Quadricycle” in the shed behind his home on Bagley Avenue in Detroit. The first automobile he designed used a light metal frame fitted with four bicycle wheels.
Number of the Day
22%
The volatility of Brent crude, the international benchmark, has fallen to around 22%. Since 1995, the average has been 32%. A lower figure indicates less volatility.
Canada
By Kristine Owram
     (Bloomberg) — Canadian stocks eked out a small gain but didn’t keep pace with their U.S. counterparts as a surge in Canadian crude prices failed to boost energy stocks.
     The S&P/TSX Composite Index added 9 points, or less than 0.1 percent, to 16,052.24. Energy shares tumbled 1.1 percent even as the discount for Canadian crude versus the U.S. benchmark tightened by nearly 50 percent. Cenovus Energy Inc. lost 5.9 percent, the most since March, on a report that ConocoPhillips is preparing to sell its stake in the company.
     Technology shares gained 1.5 percent and the health-care sector added 1.4 percent, boosted by cannabis stocks. The Canadian Senate will vote later this week on recreational pot legalization.
     In other moves:
                          Stocks
* Hudson’s Bay Co. jumped 7.2 percent to the highest since Feb.1. The retailer is selling e-commerce company Gilt for an undisclosed amount
* Enbridge Inc. rose 1.1 percent. The pipeline operator told shippers it won’t cap the amount of crude shippers can nominate for transport on its mainline, sending Canadian crude prices soaring
* Cameco Corp. gained 4.7 percent after Kazakhstan said it will support uranium prices at current levels
                         Commodities
* Western Canada Select crude oil traded at a $13.80 discount to WTI
* Gold fell 0.1 percent to $1,293.10 an ounce
                         FX/Bonds
* The Canadian dollar strengthened 0.1 percent to C$1.2935 per U.S. dollar
* The Canada 10-year government bond yield rose three basis points to 2.28 percent
US
By Sarah Ponczek and Janine Wolf
     (Bloomberg) — U.S. stocks reached the highest since mid- March, tracking peers in Europe and Asia as optimism over the world’s largest economy helped investors put protectionist fears to one side. Treasuries fell, pushing yields up for a fourth consecutive trading session.
     The S&P 500 strengthened for a second day. Microsoft Corp. agreed to buy coding site GitHub for $7.5 billion, helping to push the Nasdaq Composite Index to a record high for the first time since March. The Stoxx Europe 600 Index climbed, while the MSCI Asia Pacific Index surged even as China warned it will withdraw from commitments it made on trade if President Donald Trump carries out a separate threat to impose tariffs on the Asian country.
     “Investors have largely shrugged off the recent news of trade wars, as the concrete strength of the economy and earnings is outweighing the uncertainty from trade,” said Mark Hackett, chief of investment research at Nationwide Funds Group. “Even if all steel and aluminum tariffs are implemented, and the $50 billion specific measures in China are put in effect (leading to retaliation), the economic impact is a fraction of the positives from tax reform, fiscal spending and repatriation.”
     Investors are in a broad risk-on mood after impressive U.S. jobs data on Friday, which provided an upbeat end to a week that was otherwise dominated by the threat of another euro-area crisis. Much of that concern seems to have dissipated after nationalist parties finally took power in Italy, ending months of deadlock, while the Socialist led-opposition in Spain ousted Prime Minister Mariano Rajoy with a no-confidence vote Friday.
     “Nothing is better for the issues about trade wars or issues about G-7 than a good economy,” Omar Aguilar, chief investment officer for equities at Charles Schwab Investment Management, said by phone. “The jobs report on Friday gave a lot of people confidence that the U.S. economy is still pretty solid.”
     Attention may yet turn back to trade, however. G-7 leaders meet in Quebec later this week, with the European Union and Canada threatening retaliatory measures unless Trump reverses course on new steel and aluminum levies.
     Elsewhere, West Texas Intermediate crude fell below $66 a barrel after an OPEC committee stressed the need to ensure supplies can meet growing demand, adding to speculation the group will phase out its production cuts.
     These are some key events to watch this week:
* Reserve Bank of Australia monetary policy decision is out Tuesday.
* Tesla holds its annual shareholder meeting also Tuesday.
* U.S. ISM non-manufacturing index out Tuesday. Growth at U.S. service industries probably improved in May for the first time in four months, indicating the economy is strengthening after a first-quarter slowdown, economists forecast.
* Reserve Bank of India rate decision on Wednesday.
* U.S. trade balance and Australia GDP also out on Wednesday.
* On Thursday, Japanese Prime Minister Shinzo Abe meets with U.S. President Trump at the White House to discuss the planned U.S. summit with North Korea’s Kim Jong Un.
* Also on Thursday, euro-zone GDP.
* Turkey rate decision is due on Thursday.
* G-7 Leaders’ Summit starts in Quebec Friday through to June 9.
     These are the main moves in markets:
                          Stocks
* The S&P 500 Index gained 0.5 percent to 2,746.87, the Nasdaq Composite Index increased 0.7 percent to 7,606.46 and the Dow Jones Industrial Average rose 0.7 percent to 24,813.69 as of 4:23 p.m. in New York.
* The U.K.’s FTSE 100 Index rose 0.5 percent to the highest in more than a week.
* The MSCI Emerging Market Index rose 1.5 percent.
* Japan’s Nikkei 225 Stock Average gained 1.4 percent to the highest in a week on the biggest rise in almost seven weeks.
                          Currencies
* The Bloomberg Dollar Spot Index fell 0.1 percent, after reaching the lowest level in almost three weeks.
* The euro gained 0.3 percent to $1.1696, after touching the strongest level in almost two weeks.
* The British pound weakened 0.2 percent to $1.3314.
* The Japanese yen fell 0.3 percent to 109.82 per dollar.
                          Bonds
* The yield on 10-year Treasuries rose four basis points to 2.94 percent.
* Britain’s 10-year yield rose two basis points to 1.30 percent.
                          Commodities
* West Texas Intermediate crude fell 1.4 percent to $64.88 a barrel, the lowest in about a month.
* Gold fell 0.1 percent to $1,292.04 an ounce, the third straight decline.
–With assistance from Samuel Potter.

Have a great evening

Be magnificent!

As ever,

Carolann

We teach what we learn, and the cycle goes on.
                        -Joan L. Curcio, 1933-1999

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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