March 23, 2015 Newsletter

Dear Friends,

Tangents:

March 23^rd, 1922, Mahatma Gandhi, at his trial on a charge of sedition:

Non-violence is the first article of my faith.  It is the last article of my faith.  But I had to make my choice.  I had either to submit to a system which I considered has done an irreparable harm to my country or incur the risk of the mad fury of my  people bursting forth when they understood the truth from my lips.  I know that my people have sometimes gone mad.  I am deeply sorry for it; and I am therefore, here, to submit not to a light penalty but to the highest penalty.  I do not ask for mercy.  I do not plead any extenuating act.  I am here, therefore, to invite and submit to the highest penalty that can be inflicted upon me for what in law is a deliberate crime and what appears to me to be the highest duty of a citizen. –from The Book of Days.

PHOTOS OF THE DAY

President Barack Obama poses with six-year-old Girl Scouts from Tulsa, Okla., during the White House Science Fair Monday in the Red Room of the White House in Washington. The Girl Scouts used Lego pieces to design a battery-powered page turner to help people who are paralyzed or have arthritis. Jacquelyn Martin/AP

Elisabeth Moss (from l. to r.), Christina Hendricks, January Jones and Jon Hamm attend the unveiling of a bench in honor of the ‘Mad Men’ series in front of the Time & Life Building on Monday in New York. Charles Sykes/Invision/AP

Market Closes for March 23^rd,  2015     

International Markets

Bonds

Currencies

Commodities

Market Commentary:

Canada

By Eric Lam

     (Bloomberg) — Canadian stocks rose a second day, following the biggest weekly advance in six, as commodities producers gained after New York crude climbed. Railway shares tumbled.

     Surge Energy Inc. and Pengrowth Energy Corp. increased at least 6.4 percent as West Texas Intermediate crude rebounded from near a six-year low. AGF Management Ltd. jumped 4.9 percent to pace gains among financial shares. Centerra Gold Inc. added 5.8 percent as gold climbed to a two-week high. Canadian Pacific Railway Ltd. and Canadian National Railway Co. retreated at least 2 percent for a fifth straight day of losses.

     The Standard & Poor’s/TSX Composite Index rose 14.80 points, or 0.1 percent, to 14,957.21 at 4 p.m. in Toronto. The benchmark gauge advanced 1.4 percent last week, the biggest gain since Feb. 6. It has gained five of the past six sessions.

     Surge Energy jumped 6.5 percent for a second straight increase as energy shares rose 0.3 percent as a group. Six of 10 industries advanced on trading volume 19 percent lower than the 30-day average.

     New York benchmark crude added 1.9 percent to settle at $47.45, erasing an earlier slide after the dollar extended its decline, boosting the appeal of commodities denominated in the U.S. currency.

     Sherritt International Corp. rallied 6 percent for a second straight advance, after the company said a worker strike at its Ambatovy mine in Madagascar wouldn’t affect 2015 production guidance.                      

     Teck Resources Ltd. increased 4.6 percent and First Quantum Minerals Ltd. rallied 4.2 percent as copper climbed to an 11- week high on concerns supply will be limited to lead base metals higher in London. Raw-materials producers in the S&P/TSX jumped 1.3 percent.

     Railroad stocks tumbled in Canada and the U.S. after Kansas City Southern Corp. cut its forecast for revenue growth in 2015. A Canadian Pacific potash train derailed near Wetaskiwin, Alberta on March 22, a company spokesman said.

     Canadian Pacific sank 2.5 percent for a fifth straight decline, the longest losing streak since Jan. 7. Canadian National lost 2 percent.

     Industrials shares plunged 1.5 percent as a group, most in the broader index. The industry has declined 2.4 percent in five days of declines.

US

By Joseph Ciolli

     (Bloomberg) — U.S. stocks retreated after the Standard & Poor’s 500 Index climbed within four points of a record, as a drop in transportation companies overshadowed gains in shares of consumer-staples producers.

     The Dow Jones Transportation Average dropped 2 percent , led lower by Kansas City Southern Corp.’s 8 percent plunge after it cut its outlook for revenue growth in 2015. The Nasdaq Biotechnology Index fell 2.2 percent after setting a record Friday. Oreo maker Mondelez International Inc. and Reynolds American Inc. rose more than 1.6 percent.

     The S&P 500 slipped 0.2 percent to 2,104.42 at 4 p.m. in New York. The Nasdaq Composite Index lost 0.3 percent from a 15- year high. The Russell 2000 Index fell 0.1 percent after reaching a record on Friday. About 5.9 billion shares changed hands on U.S. exchanges today, 14 percent below the three-month average.

     “I don’t see any reason to think we need to take another leg up to start the week today,” Michael James, a Los Angeles- based managing director of equity trading at Wedbush Securities Inc., said in a phone interview. “The market is going to remain in a trading range, and we’re in the upper band right now.”

     The S&P 500 and Dow are less than 1 percent from records they last reached on March 2. The Nasdaq Composite jumped on Friday to a 15-year high, almost erasing its losses since the end of the dot-com bubble. The S&P 500 rose 2.7 percent last week, with the dollar weakening, as concern eased about an interest-rate increase.

     The Nasdaq gauge has rebounded 3.3 percent since March 11. It crossed 5,000 earlier this month before losing 3.2 percent in nine days. The index was bolstered by a rally in health-care stocks. The Nasdaq Biotechnology Index jumped 6.2 percent through Friday for its biggest weekly gain since October.

     The S&P 500 has gone 24 consecutive sessions without back- to-back advances, the longest since a 24-day stretch in 2008. In 2014, gains came much easier as the measure never fell four days in a row.

     The benchmark equity gauge rose as much as 0.3 percent Monday, less than three points from its all-time record reached on March 2. The Nasdaq Composite came within 18 points of its March 2000 peak of 5,048.62 before closing down on the day.

     The Nasdaq index approached a record the same week that its biggest member, Apple Inc., entered a much older gauge, the Dow Jones Industrial Average. At 44, the Nasdaq has been around less than half as long as the Dow, and has spent about one-third of its life trying to claw back from the dot-com crash.                        

     Federal Reserve Vice Chairman Stanley Fischer said raising interest rates from near zero “likely will be warranted before the end of the year,” and subsequent increases probably won’t be uniform or predictable.

     “A smooth path upward in the federal funds rate will almost certainly not be realized,” as the economy will encounter shocks such as the surprise plunge in oil prices or future geopolitical crises, Fischer said Monday in remarks prepared for delivery to the Economic Club of New York.

     San Francisco Fed President John Williams will deliver a speech via videoconference to the Australian Business Economists. Cleveland Fed President Loretta Mester said in a Bloomberg Television interview in Paris Monday that it is appropriate to raise rates this year.

     Sales of previously owned homes fell short of a 5 million annual rate in February for a second month, showing an industry struggling to gain traction amid rising prices and a lack of inventory.

     Closings rose 1.2 percent to a 4.88 million annual rate, the National Association of Realtors reported Monday in Washington. The median value of a house climbed 7.5 percent from the same month last year.

     The Chicago Board Options Exchange Volatility Index increased 3 percent to 13.41. The gauge, know as the VIX, fell 19 percent last week, its biggest five-day decline since January.

     Six of the S&P 500’s 10 main groups retreated, led by a 0.8 percent slide among industrial companies.

     Kansas City Southern slipped 8 percent after announcing updated 2015 guidance, pushing the Dow Jones Transportation Index down 2 percent. The company now sees low single-digit revenue growth for the year, reducing a January outlook forecasting a mid-single-digit increase. Union Pacific Corp. and CSX Corp. lost more than 3.9 percent.                    

     Vertex Pharmaceuticals Inc. dropped 4 percent after the company said its cystic fibrosis drug Kalydeco combined with an experimental drug helped patients’ breathing less than analysts forecast. Celgene Corp. and Regeneron Pharmaceuticals Inc. decreased more than 2.1 percent.

     Consumer-staples producers in the S&P 500 rose 0.3 percent. Mondelez added 1.6 percent, while tobacco company Reynolds American gained 2.3 percent and Archer-Daniels-Midland Co.advanced 0.3 percent.

     Tiffany & Co. rallied 5.8 percent after a 4 percent selloff Friday. Darden Restaurants Inc. added 3.7 percent to hit an all- time high for a second day.

     Apple, EBay and International Business Machines Corp. rose more than 1 percent as technology shares gained 0.1 percent.

     Tenet Healthcare Corp. jumped 4.9 percent after saying it will combine its outpatient surgery centers with closely held United Surgical Partners International Inc. in a joint venture, expanding its bet on facilities that are becoming more popular with patients.

Have a wonderful evening everyone.

Be magnificent!

As long as you pursue pleasure, you are attached to the sources of pleasure;

and as long as you are attached to the sources of pleasure,

you cannot escape pain and sorrow,  The soul shines in the hearts of all living beings.

When you see the soul in others, you forget your own desires and fears,

and lose yourself in the service of others.

The soul shines equally in people on the farthest island, and in people close at hand.

Mundaka Upanishad

As ever,

Carolann

Cannot people realize how large an income is thrift?

                     -Marcus Tullius Cicero, 106-43 B.C.

Carolann Steinhoff, B.Sc., CFP®, CIM, CIWM

Senior Vice-President &

Senior Investment Advisor

Queensbury Securities Inc.,

St. Andrew’s Square,

Suite 340A, 730 View St.,

Victoria, B.C. V8W 3Y7