March 27, 2013 Newsletter

Dear Friends,

Tangents: Full Moon night!

Third night of Passover tonight…Easter weekend ahead of us.


Now the green blade riseth,

from the buried grain,

Wheat that in dark earth

many days has lain;

Love lives again,

that with the dead has been:

Love is come again,

like wheat that springeth green.

-J.M. C. Crum

Exciting news in the culinary world today:  Abbotsford farmer Bill Stewart has produced B.C.’s first Périgord truffle!  Let’s hope his success continues.

Business is a combination of war and sport. –Andre Maurois

Photos of the Day – March 27th, 2013

Toll collector Marilyn Alvarado (c.) leaves her tollbooth, as the last human toll collector, at the Golden Gate Bridge toll plaza in San Francisco, California. The Golden Gate Bridge will convert from manned tollbooths to a full electronic tolling system Stephen Lam/Reuters

Christie’s scientific specialist James Hyslop poses for photographs with a sub-fossilized pre-17th century Elephant Bird egg at the auction house’s premises in London. The extinct Elephant Bird species was native to Madagascar and among the heaviest known birds. Matt Dunham/AP

Market Closes for March 27th, 2013



Close Change


14526.16 -33.49 



S&P 500 1562.85 -0.92 



NASDAQ 3256.522 +4.039 



TSX 12699.65 -6.73 




International Markets



Close Change
NIKKEI 12493.79 +22.17 






22464.82 +153.74 




SENSEX 18704.53 +23.11 




FTSE 100 6387.56 -11.81 





Bonds % Yield Previous % Yield

10 Year Bond

1.756 1.817

30 Year


2.490 2.537

10 Year Bond

1.8454 1.9094

30 Year Bond

3.0879 3.1427


BOC Close Today Previous
Canadian $ 0.98396 0.98389 




1.01630 1.01637
Euro Rate 

1 Euro=




1.29859 0.77006


1.27776 0.78262


Gold Close Previous
London Gold  


1604.70 1599.59
Oil Close Previous 


WTI Crude Future 96.58 96.34
BRENT 110.37 110.18 


Market Commentary:


By Lindsey Rupp

March 27 (Bloomberg) — Canadian stocks fell, extending a monthly decline, as banks and energy producers slumped amid growing concern over Europe’s debt crisis.

Financial stocks retreated as Toronto-Dominion Bank and Royal Bank of Canada fell at least 0.9 percent. AGF Management Ltd. slipped 5.7 percent after the asset manager received a notice from the national tax collector. Niko Resources Ltd. rose 10 percent after saying it’s in negotiations to sell C$157 million ($154 million) worth of assets. Alacer Gold Corp. and Centerra Gold Inc. added more than 3.6 percent as gold prices increased for the first time in four days.

The Standard & Poor’s/TSX Composite Index fell 6.73 points, or 0.1 percent, to 12,699.65 at 4 p.m. in Toronto. The S&P/TSX lost as much as 0.7 percent earlier in the day and is down 1 percent in March. Trading volume was 4.3 percent lower than the 30-day average.

“Fears out of Europe are containing enthusiasm, and if you’re afraid of Europe then gold is the place to be,” Barry Schwartz, fund manager with Baskin Financial Services who helps manage about C$500 million, said from Toronto.

The Institute of International Finance said banks in Portugal, Spain and Italy may come under funding pressure after a deal yesterday in Cyprus rescued the island’s financial system at the expense of bank creditors.

European governments and the International Monetary Fund agreed earlier this week to lend Cyprus 10 billion euros ($13 billion) as long as the country liquidated its second-largest bank and forced losses on bank bondholders and deposits of more than 100,000 euros.

Canadian consumer prices rose 1.2 percent in February, the fastest monthly pace since 1991, on a spike in gasoline and clothing prices. The figure remains below the central bank’s 2 percent target.

Financial shares contributed most to the S&P/TSX decline, retreating 0.7 percent as a group. Royal Bank of Canada, the country’s largest lender, slipped 1.3 percent to C$60.71 as the firm announced plans to issue more U.S. covered bonds. Toronto Dominion fell 0.9 percent to C$83.95.

AGF Management declined 5.7 percent to C$10.84. The asset manager said the Canadian Revenue Agency contacted the firm about the transfer pricing and allocation of income between a Canadian and foreign subsidiary within AGF Management. The CRA could reassess tax years 2005 through 2007. AGF Management said it plans to rebut any formal assessment the agency may request.

Energy producers pared losses as oil rose to a five-week high after a government report showed that U.S. refineries boosted operating rates. Crude tumbled as much as 0.8 percent earlier in the day, on a report that U.S. inventories rose.

Oil producer Suncor Energy Inc. dropped 1.1 percent to C$30.40. Crude pipeline operator Enbridge Inc. slid 0.6 percent to C$47.

Niko Resources added 10 percent to C$5.82. The oil and natural gas explorer with operations in Bangladesh, Pakistan and India, is in “advanced negotiations” with two potential buyers for undisclosed assets, the company said today in a statement.

It plans to complete the agreements by the end of next month.

Raw-materials producers climbed 1.1 percent as a group, as gold advanced 0.6 percent to settle at $1,607.20 an ounce. The metal has risen 1.8 percent in March as Europe’s debt woes spurred demand for gold as a haven.

Alacer Gold gained 5.6 percent to C$4.16 and Centerra Gold rose 3.6 percent to C$6.27. Barrick Gold Corp., the largest gold producer in the world, added 2 percent to C$29.90.


By Sarah Pringle

March 27 (Bloomberg) — U.S. stocks fell, after the Standard & Poor’s 500 Index yesterday rallied toward a record high, amid concern over Europe’s debt crisis and as pending American home sales slipped in February.

Banks fell as JPMorgan Chase & Co. and Citigroup Inc. lost at least 0.8 percent. Cliffs Natural Resources Inc. tumbled 14 percent after Morgan Stanley downgraded the shares. Apple Inc. slumped 2 percent after Pacific Crest predicted it would miss revenue expectations. Humana Inc. and UnitedHealth Group Inc. rose at least 1.7 percent after the U.S. Medicare program was granted authority to raise insurers’ payments. AOL Inc. surged 8.4 percent after Barclays Plc lifted the company’s rating.

The S&P 500 dropped 0.1 percent to 1,562.85 at 4 p.m. in New York, paring an earlier decline of as much as 0.8 percent.

The Dow Jones Industrial Average fell 33.49 points, or 0.2 percent, to 14,526.16. About 5.2 billion shares changed hands on U.S. exchanges, 18 percent below the three-month average.

“When you have typically light days, the market can get pushed around a little bit more on nothing,” Frank Ingarra, head trader at Greenwich, Connecticut-based NorthCoast Asset Management LLC, said in a telephone interview. His firm oversees $1.5 billion. “The market’s still poised to go up.”

The S&P 500 rallied yesterday to within two points of its record of 1,565.15 reached in October 2007, as orders for durable goods and home prices exceeded estimates. The benchmark gauge has traded above 1,560 on seven days since March 14, only to fall short of the record each time. The Dow climbed to another record yesterday, after first surpassing its 2007 all- time high on March 5.

The bull market in equities entered its fifth year this month as the S&P 500 more than doubled from its bottom in 2009, driven by an unprecedented three rounds of bond purchases by the Federal Reserve. The S&P 500 is up 9.6 percent for the year, and has gained 3.2 percent in March.

The Institute of International Finance said today banks in Portugal, Spain and Italy may come under funding pressure after a deal earlier this week in Cyprus rescued the island’s financial system at the expense of bank creditors.

European governments and the International Monetary Fund agreed Monday to lend Cyprus 10 billion euros ($13 billion) as long as the country liquidated its second-largest bank and forced losses on bank bondholders and deposits of more than 100,000 euros.

“I don’t think the bottom’s going to drop out, but it’s not that simple to just say, ‘Cyprus, where is it, who cares?’”

Robert Doll, chief equity strategist at Nuveen Asset Management LLC, said in an interview on Bloomberg TV’s “Surveillance” with Tom Keene and Scarlet Fu. He helps oversee $117 billion at the Chicago-based firm. “It took years for Europe to get into this mess. It will take years for Europe to get out.”

While the improving economy is driving the bull market in U.S. equities, Doll said gains may slow after the S&P 500 surged 130 percent since March 2009.

“We’re due for a rest and a rest doesn’t mean a big decline,” he said.

Fewer Americans signed contracts to purchase previously owned homes in February, indicating a pause in momentum for an industry that is helping power the economy. The index of pending home sales fell 0.4 percent to 104.8, the second-highest level since April 2010, after a revised 3.8 percent increase the prior month, the National Association of Realtors reported.

The Chicago Board Options Exchange Volatility Index, which measures the cost of using options as insurance against claims, rose 3 percent to 13.15 today. The KBW Bank Index dropped 0.6 percent, as 18 of the gauge’s 24 members retreated. JPMorgan slid 1.8 percent to $47.77 and Citigroup lost 0.8 percent to $44.46, pacing declines among financial firms.

Cliffs Natural Resources plunged 14 percent, the most in the S&P 500, to $18.46. Morgan Stanley cut its recommendation on shares of the biggest U.S. iron-ore producer to underweight, the equivalent of sell, from equal weight. The company’s iron-ore business will be halved in the coming years because of increased supply in the Great Lakes area, analysts led by Evan Kurtz wrote in a note.

Separately, Credit Suisse Group AG cut its 12-month estimate on the share price to $10 from $20, while maintaining an underperform rating.

Apple slumped 2 percent to $452.08. Pacific Crest analyst Andy Hargreaves said the company may miss revenue expectations during the second and third quarters, due to “relatively soft” sales of large-screen iPads and iPhones. Apple shares have slumped 15 percent this year, sliding to their lowest price in more than 13 months on March 4.

Dollar General Corp. fell 2.4 percent to $50.95. The discount retailer said 30 million of its shares will be sold in an underwritten secondary public offering. The offer is by certain existing shareholders and no shares are being sold by the company, Goodlettsville, Tennessee-based Dollar General said in a statement.

Best Buy Co. dropped 2.4 percent to $22.15. S&P Capital IQ cut its rating on the electronics retailer to sell from hold.

Humana jumped 3 percent to $68.72 and UnitedHealth rose 1.7 percent to $56.62, after congressional researchers said the U.S. Medicare program has the authority to raise payments to insurers.

AOL, the Web publisher that owns the Huffington Post and TechCrunch, climbed 8.4 percent to $39.20. Barclays raised its rating on the company to overweight from equalweight, saying profit will increase faster than analysts’ estimates on cost- cutting and modest revenue growth.

Mattress Firm Holding Corp. rallied 12 percent to $34.77.

Raymond James equity analyst Budd Bugatch lifted his rating on the Houston-based retailer to outperform from market perform.

SAIC Inc. advanced 3.9 percent to $13.32 after the eighth- largest contractor to the U.S. government said late yesterday it will pay a special dividend of $1 per share. The company forecast full-year earnings of $1.16 to $1.33 a share.


Have a wonderful evening everyone.


Be magnificent!


The whole universe is to us a writing of the Infinite in the language of the finite.

Swami Vivekananda, 1863-1902

As ever,




Have no fear of perfection – you’ll never reach it.

-Salvador Dali, 1904-1989

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

Senior Vice-President &

Senior Investment Advisor

Queensbury Securities Inc.,

St. Andrew’s Square

Suite 340A, 730 View St.,

Victoria, B.C. V8W 3Y7