June 5th, 2025, Newsletter

Dear Friends,

Tangents:
Carolann is away from the office for two days attending the 2025 Bloomberg Tech Conference in San Francisco, I will be writing the newsletter on her behalf.

June 5, 1661: Isaac Newton was admitted to Trinity College, Cambridge, as a student.
June 5, 1917: 10 million US men begin registering for draft in WW I
June 5, 1968: Sen. Robert F. Kennedy was shot and mortally wounded just after claiming victory in California’s Democratic presidential primary. Gunman Sirhan Bishara Sirhan was immediately arrested. Go to article

World Environment Day…

‘Alien’s language’ problem that stumped mathematicians for decades may finally be close to a solution
The Inter-universal Teichmüller Theory, an infamous proof that has confounded mathematicians for over a decade, has been partially solved.

Ancient DNA reveals mysterious Indigenous group from Colombia that disappeared 2,000 years ago
A new analysis of ancient DNA reveals a previously unknown lineage of hunter-gatherers who lived in what is now Colombia.

An ‘invisible threat’: Swarm of hidden ‘city killer’ asteroids around Venus could one day collide with Earth, simulations show
A new study suggests that unidentified “co-orbital asteroids” around Venus may have the capacity to impact our planet in the future, with potentially devastating consequences. However, there is no immediate threat.

Ginormous planet discovered around tiny red star challenges our understanding of solar systems
Scientists have discovered a giant planet called TOI-6894b, orbiting a star that should be far too small to have formed it. The discovery could further challenge theories of planet formation.

James Webb telescope spots ‘groundbreaking’ molecule in scorching clouds of giant ‘hell planet’
A pair of new studies has revealed that the hellish skies of exoplanet WASP-121b contain silicon monoxide gas, which has never been found in any planetary atmosphere to date.

PHOTOS OF THE DAY
Paris, France
Visitors look at the artwork Clinamen, an aquatic and musical installation by the artist Céleste Boursier-Mougenot, at the Bourse de Commerce Pinault collection
Photograph: Sarah Meyssonnier/Reuters

Colombo, Sri Lanka
A train arrives at a station next to the sea
Photograph: Ishara S Kodikara/AFP/Getty Images

Fitz Roy, Patagonia
‘Smoking Mountain in all its glory.’
Photograph: Guilheme Perodeau
Market Closes for June 5^th, 2025

International Markets

Bonds

Currencies

Commodities

Market Commentary:
“The best way to predict your future is to create it.” — Peter Drucker
Canada
By Bloomberg Automation
(Bloomberg) — The S&P/TSX Composite advanced slightly to 26,342.29 in Toronto.
The move follows the previous session’s decrease of 0.4%.
Shopify Inc. contributed the most to the index gain, increasing 1.3%.
First Majestic Silver Corp. had the largest increase, rising 15.5%.
Today, 116 of 217 shares rose, while 94 fell; 5 of 11 sectors were higher, led by materials stocks.

Insights
* This quarter, the index rose 5.7%
* So far this week, the index rose 0.6%
* The index advanced 19% in the past 52 weeks. The MSCI AC Americas Index gained 12% in the same period
* The S&P/TSX Composite is 0.5% below its 52-week high on June 3, 2025 and 22.7% above its low on June 17, 2024
* The S&P/TSX Composite is up 0.5% in the past 5 days and rose 5.6% in the past 30 days
* S&P/TSX Composite is trading at a price-to-earnings ratio of 18.9 on a trailing basis and 16.6 times estimated earnings of its members for the coming year
* The index’s dividend yield is 2.7% on a trailing 12-month basis
* S&P/TSX Composite’s members have a total market capitalization of C$4.24t
* 30-day price volatility fell to 6.80% compared with 7.20% in the previous session and the average of 18.48% over the past month

Index Points
Materials | 14.9826| 0.4| 35/15
Financials | 9.6275| 0.1| 15/10
Energy | 8.8657| 0.2| 20/18
Real Estate | 1.8803| 0.4| 14/2
Health Care | 0.0221| 0.0| 2/2
Consumer Discretionary | -0.2278| 0.0| 4/6
Communication Services | -2.2078| -0.4| 2/3
Consumer Staples | -3.1848| -0.3| 5/5
Utilities | -3.2250| -0.3| 5/10
Industrials | -6.5655| -0.2| 11/16
Information Technology | -6.6587| -0.3| 3/7
(MT Newswires)
The Toronto Stock Exchange posted a small gain on Thursday, following on Wednesday’s dip, but failed to reach the record closing levels of earlier this week amid diverging views on the outlook for interest rates and after Canada posted its largest-ever trade deficit.
The S&P/TSX Venture Exchange closed up 13.29 points to 26,342.29.
Among sectors, Base Metals, up 2.42%, and Energy, up 0.45%, were the biggest gainers on the day, with Health Care and Information Technology down 0.63% and 1.09%, respectively.
Reflecting the diverging views on rates, Royce Mendes, Head of Macro Strategy at Desjardins Capital, today reacted to a speech from a Bank of Canada official by saying data on the economy and inflation will need to be “somewhat weaker-than-previously envisaged” for the central bank to feel comfortable reducing rates further.
But National Bank cited S&P Global Services PMI data released yesterday that showed Canada “dead last in manufacturing and dead last in services” and the bank expects a resumption of the rate cutting cycle in late July.
For its part, Rosenberg Research noted fresh data today showed Canadian exports fell to the lowest since June 2023 in April, confirming the rosy Q1 picture was a mirage.”
It said when Canada’s GDP surprised to the upside last week it had written that it seemed to be driven by an “unusual” increase in exports, suggesting some pre-tariff distortions.
Rosenberg Research expected some reversion in Q2, and said here it is: The consensus was for a merchandise trade deficit of C$1.5 billion, and it came in at C$7.1 billion as exports fell rapidly.
This would imply Q2 GDP growth sharply below the 2.2% pace in Q1, Rosenberg added.
Rosenberg Research said its remains “skeptical” on the Canadian dollar, especially in the context of yesterday’s BoC decision to pause on rates, “which only builds up pressure for fast cuts later this year.”
A day after the BoC decided to keep the policy interest rate at 2.75%, Deputy Governor Sharon Kozicki delivered a speech entitled ‘Reaching out for a clearer view of the economy’ before the C.D. Howe Institute in Toronto.
In justifying the central bank’s decision to hold rates steady yesterday, Desjardins noted Kozicki said the Governing Council relied heavily on private consultations with firms and unpublished survey data.
Kozicki said “firms believed that their worst-case tariff scenarios were much less likely to materialize than they reported earlier this year.”
However, avoiding the worst-case scenario hardly seems like a reason to hold rates steady at the current neutral setting given that the economy is still being hammered by tariffs, Mendes wrote.
Mendes noted that despite consumers receiving a major discount on their monthly expenses from the elimination of the carbon tax, preliminary data released alongside the speech suggest that consumers still see inflation averaging about 4% over the coming year.
He cited Kozicki as saying “firms spoke about their costs increasing, which likely means they will need to raise prices at some point.”
The surveys, Mendes said, do not preclude a rate cut in July, but do raise the bar for upcoming hard data releases.
“Assuming the final readings for Q2 inflation expectations remain elevated, data on the economy and inflation will need to be somewhat weaker-than-previously envisaged for the Bank of Canada to feel comfortable reducing rates further,” he added.
The Kozicki comments came as National Bank said tariff uncertainty is not only dragging down Canadian factories.
It noted S&P Global’s Services PMI for the month of May, in which the Canadian reading was the weakest of all 14 countries whose services sector is covered by S&P Global.
“That’s dead last in manufacturing and dead last in services, leaving Canada as clear outlier in this sample of key peers.”
National Bank added: “Complicating matters, the report on Canada also flags an acceleration in input price inflation and the biggest rise in output prices in a year.
That won’t come as any comfort to the Bank of Canada, who left its policy rate on hold yesterday in light of tariff-related inflation risks.
But while there may be cost pressures that stem from the disrupted trade environment, there are also disinflationary pressures associated with the economic slack that has accumulated and will continue to accumulate this year.
On balance, we’re less concerned about near-term inflation than we are for the health of the economy.
As more data accrues over the next eight weeks, we expect the Bank of Canada to adopt a similar view allowing for a resumption of the rate cutting cycle in late July.”
Of commodities, gold traded lower Thursday on Thursday as the dollar weakened after the U.S. trade deficit narrowed in April with imports plunging due to the Trump Administration imposing widespread tariffs on the country’s trading partners.
Gold for August delivery was last seen down U$24.40 to US$3,374.80 per ounce.
But West Texas Intermediate oil closed higher on expectations demand is strengthening as the U.S. driving season takes hold while wildfires in northern Alberta cut into oil-sands supply.
WTI crude oil for July delivery closed up $0.52 to settle at US$63.37 per barrel, while August Brent crude was last seen up $0.47 to US$65.33.
US
By Rita Nazareth
(Bloomberg) — Stocks fell alongside Treasuries as online squabbling between President Donald Trump and Elon Musk knocked down Tesla Inc., weighing heavily on the megacap tech space.
While equities closed away from session lows, the Nasdaq 100 dropped almost 1%.
Tesla sank 14% as Trump proposed ending Musk’s government contracts and subsidies after his onetime adviser attacked the Republican tax-policy bill.
Earlier gains in equities were driven by hopes tensions between the US and China would ease as Trump and Xi Jinping agreed to further trade talks.
On the eve of the all-important jobs data, an unexpected jump in unemployment claims added to speculation the Federal Reserve will cut rates at least twice this year.
Economists see payrolls rising by 125,000 after job growth in March and April exceeded projections.
That would leave the average over the past three months tracking a still-solid 162,000.
The unemployment rate is seen holding at 4.2%.

Corporate Highlights:
* Broadcom Inc., a chip supplier to companies like Alphabet Inc.and Apple Inc., gave a lackluster revenue forecast for the current quarter, suggesting that the AI spending frenzy isn’t as strong as some investors anticipated.
* Lululemon Athletica Inc. trimmed its profit outlook for the full year and projected lower-than-expected sales for the current quarter.
* Circle Internet Group Inc. surged after the company and some of its shareholders raised nearly $1.1 billion in an initial public offering that was upsized twice amid strong demand.
* Brown-Forman Corp., owner of the Jack Daniel’s brand, tumbled on results that trailed expectations while projecting a sales decline for the current fiscal year.
* Kimberly-Clark Corp. has agreed to sell a majority stake in its global Kleenex and tissue businesses outside of North America to a newly-formed venture with Brazilian pulp supplier Suzano SA.

Some of the main moves in markets:
Stocks
* The S&P 500 fell 0.5% as of 4 p.m. New York time
* The Nasdaq 100 fell 0.8%
* The Dow Jones Industrial Average fell 0.3%
* The MSCI World Index fell 0.4%
* Bloomberg Magnificent 7 Total Return Index fell 2.2%
* The Russell 2000 Index was little changed
* Tesla fell 14%
Currencies
* The Bloomberg Dollar Spot Index was little changed
* The euro rose 0.2% to $1.1436
* The British pound rose 0.1% to $1.3572
* The Japanese yen fell 0.7% to 143.73 per dollar
Cryptocurrencies
* Bitcoin fell 2.6% to $101,936.68
* Ether fell 3% to $2,527.19
Bonds
* The yield on 10-year Treasuries advanced four basis points to 4.40%
* Germany’s 10-year yield advanced five basis points to 2.58%
* Britain’s 10-year yield advanced one basis point to 4.62%
Commodities
* West Texas Intermediate crude rose 0.8% to $63.36 a barrel
* Spot gold fell 0.5% to $3,356.77 an ounce

Have a lovely evening.

Be magnificent!

As ever,

Shab
“A painting is not a picture of an experience, but is the experience.” — Mark Rothko

Shab Mohammadpour
Assistant to Carolann Steinhoff
Queensbury Securities Inc.
340A – 730 View Street
Victoria BC  V8W 3Y7
Tel: 778-430-5851
Fax: 778-430-5828