March 8, 2023 Newsletter

Dear Friends,

Tangents: International Women’s Day.

March 8, 1971: Joe Frazier defeated Muhammad Ali by decision at Madison Square Garden in New York in the first of three bouts between the heavyweights. Go to article » 

1913: US income tax begins.
1917: Russian Revolution begins.

What it’s like to drive Ferrari’s $393,000 SUV.

New York, London top list of cities with the most super-rich homeowners.

What to know about Holi, the festival of colors.  Millions of people in India and around the world are celebrating Holi this week. Learn about the Hindu festival and its signature traditions!

Couple jailed for stealing $1.7 million of wine from restaurant.  The pair of thieves made several pour decisions… here’s what we know about the heist.

The Oscars are this weekend.  And host Jimmy Kimmel said he’s ready for anything — even another slap.

Bronze Age ice skates with bone blades discovered in China: Archaeologists in China have unearthed 3,500-year-old ice skates crafted from animal bone in the country’s western Xinjiang Uyghur Autonomous Region, a mountainous area that some archaeologists think was the birthplace of skiing.
These ice skates, the oldest ever found in China, were made from the bones of oxen and horses. Full Story: Live Science (3/7)

Newfound ancient Egyptian sphinx statue may depict Roman emperor Claudius, but not everyone agrees: Archaeologists excavating an ancient temple in Egypt have unearthed a statue of a sphinx whose face may depict the Roman emperor Claudius, the Egyptian Ministry of Tourism and Antiquities said in a statement Monday (March 6).
However, scholars not affiliated with the research told Live Science that they cannot be certain the face is that of Claudius. Full Story: Live Science (3/7)

Ghostly scraps of oldest recorded supernova revealed in stunning telescope image: The shredded remnants of the first supernova ever recorded by humans — which appeared in the sky more than 1,800 years ago and vanished within eight months — rise from the cosmic grave in a stunning new image from the National Science Foundation’s NOIRLab.
Tinged blood red and swirling around an invisible center of mass, the ghostly clouds of gas are thought to be the last scraps of a star that exploded so brightly and violently that the blast was visible in Earth’s nighttime skies for nearly a year in A.D. 185.  Full Story: Live Science (3/7)

Galaxy-size shock waves found rattling the cosmic web – the largest structure in the universe: For the first time, astronomers have spotted enormous, galaxy-scale shock waves rattling the “cosmic web” that connects nearly all known galaxies.
These cosmic waves could reveal clues about how the largest objects in the universe were sculpted. Full Story: Live Science (3/7)

PHOTOS OF THE DAY

London, UK
Research into clothing patents stretching back over 200 years, funded by the European Research Council at Goldsmiths, University of London, has revealed a hidden history of women’s sport. As part of the project, a selection of active and sportswear patents from the 1890s to the 1940s were recreated by the sewing sociologist Dr Katrina Jungnickel and her team at the Politics of Patents project
Photograph: Goldsmiths/PA

Manchester, UK
The Flying Scotsman, which is being operated by an all-female footplate team to mark International Women’s Day, passes over the River Irwell at Ramsbottom. The crew is made up of three volunteers from the East Lancashire Railway – Linda Henderson, Charlotte Instance and Steph Elwood – who are accompanied by driver Beth Furness from Network Rail
Photograph: Peter Byrne/PA

Kabul, Afghanistan
Women campaign for their rights on International Women’s Day
Photograph: AFP/Getty
Market Closes for March 8^th, 2023

International Markets

Bonds

Currencies

Commodities

Market Commentary:
📈 On this day in 1817: The New York Stock & Exchange Board, the ancestor of the NYSE, was formed when 24 brokers agreed on a “Constitution” that fixed commissions at 0.25% and set a fine of at least six cents for talking out loud about other subjects while stocks were being traded.
Canada
By Bloomberg Automation
(Bloomberg) — The S&P/TSX Composite rose 0.4% at 20,346.53
in Toronto. The move follows the previous session’s decrease of
1.2%.
Shopify Inc. contributed the most to the index gain,
increasing 3.2%. Ecn Capital Corp. had the largest increase,
rising 16.6%.
Today, 132 of 236 shares rose, while 96 fell; 6 of 11
sectors were higher, led by information technology stocks.
Insights
* This quarter, the index rose 5%
* The index declined 4.2% in the past 52 weeks. The MSCI AC Americas Index lost 5.1% in the same period
* The S&P/TSX Composite is 8.4% below its 52-week high on April 5, 2022 and 13.8% above its low on Oct. 13, 2022
* The S&P/TSX Composite is up 0.4% in the past 5 days and fell 1.6% in the past 30 days
* S&P/TSX Composite is trading at a price-to-earnings ratio of 13.1 on a trailing basis and 13.1 times estimated earnings of its members for the coming year
* The index’s dividend yield is 3.2% on a trailing 12-month basis
* S&P/TSX Composite’s members have a total market capitalization of C$3.24t
* 30-day price volatility rose to 8.70% compared with 8.62% in the previous session and the average of 8.08% over the past month
================================================================
|Index Points | |
Sector Name | Move | % Change | Adv/Dec
================================================================
Information Technology | 27.3430| 2.2| 14/0
Industrials | 14.7619| 0.5| 20/6
Materials | 11.5738| 0.5| 22/28
Energy | 7.5195| 0.2| 20/15
Utilities | 5.7916| 0.7| 13/2
Financials | 2.6987| 0.0| 16/12
Real Estate | -0.0759| 0.0| 11/11
Communication Services | -0.3250| 0.0| 3/3
Consumer Staples | -0.6701| -0.1| 5/6
Health Care | -0.7177| -0.9| 2/4
Consumer Discretionary | -2.6222| -0.4| 6/9
================================================================
| | |Volume VS | YTD
| Index | | 20D AVG | Change
Top Contributors |Points Move| % Change | (%) | (%)
================================================================
Shopify | 15.2200| 3.2| -23.8| 28.2
Nutrien | 9.7090| 2.5| -10.1| 13.4
Constellation Software | 9.6890| 3.2| -31.7| 11.8
Bank of Montreal | -2.6250| -0.4| -18.3| 3.8
Sun Life Financial | -2.7150| -1.0| -54.4| 5.9
Bank of Nova Scotia | -2.7180| -0.5| -27.0| 3.6
US
By Rita Nazareth
(Bloomberg) — Wall Street didn’t get much relief from Jerome Powell’s testimony to American lawmakers — especially after another round of jobs figures came on the hot side, bolstering bets the Federal Reserve will have no alternative but remain hawkish in the months to come.
Equities whipsawed even after the Fed chief’s reassurance that no decision has been made on the size of a rate increase in March and the central bank isn’t seeking to cause a recession.
For one, Powell reiterated that officials are likely to take rates higher than previously anticipated, and could move at a faster pace if needed.
Then, there’s all the anxiety building ahead of the next economic readings.
Policymakers will scrutinize Friday’s jobs report for three key indicators: payrolls, wage gains and the unemployment rate.
If they all point to a robust labor market — perhaps even just slightly stronger than forecast — that will be a green light to a bigger hike, likely reducing suspense in the inflation reports due next week.
“The Fed has been very consistent in that ‘if inflation continues to be higher, we’re going to hike more’,” said Kara Murphy at Kestra Investment Management. “And now the market is acting surprised. I’ve likened it a little bit to when it’s bedtime at my house and I’m telling the kids, ‘it’s bedtime,’ and I tell them three times and they don’t listen to me. And then suddenly the fourth time they’re like ‘oh, I’ve got to get my pj’s on.’”
After a series of small twists and turns, the S&P 500 finished up by just 0.1%, while remaining below the 4,000 level.
The gauge is still trading above its key 200-day moving average — a threshold that has been vigorously defended by traders.
Bonds also saw some choppy action on Wednesday, with the two-year yield remaining above 5% — its highest since 2007.
Bets among swap traders were solidly tilted toward a half-point move in March rather than a quarter-point.
It’s proving quite difficult to budge Treasury investors from the turbocharged curve shift that’s gripped markets — with yields on shorter-term US securities continuing to rise faster than longer-maturity peers — as traders double down on the prospects for a US recession.
To James Demmert at Main Street Research, the market is finally coming to the realization that elevated interest rates are here to stay and the idea of a Fed pivot anytime soon is wishful thinking.
“The Fed may be much more determined to raise rates,” Demmert added. “At the same time, the lag effect of rising rates over the past year may be slowing the economy.
The risk of a recession has now increased in recent weeks, as the lag effect from the Fed’s tightening may soon start to show up in the data, just as the Fed has doubled down on raising interest rates.
This combination of a weakening economy and more rate hikes would surely push the economy into a recession.”
The economy proved resilient to start the new year, marked by steady consumer spending and stabilizing manufacturing activity, according to the Fed’s latest Beige Book.
However, the outlook going forward is less optimistic.
“Amid heightened uncertainty, contacts did not expect economic conditions to improve much in the months ahead.”
Fed Bank of Richmond President Thomas Barkin said the central bank needs to continue to raise rates, without giving an opinion on the size of the hike planned later this month. “We’ve seen some progress but at 5.5% inflation remains well above the Fed 2% target, and as a result we’ve made clear we still have work to do.”
Citigroup Inc. economists see the Fed raising its benchmark lending rate by 50 basis points at the March meeting, joining Goldman Sachs Group Inc. in lifting their forecast.
They increased the estimate from 25 basis points, and also boosted their projection for peak rates to a range of 5.5% to 5.75%.
Amid ever-changing macro data that’s dimming visibility into future cash flows, Wall Street analysts have been busy revisiting their corporate earnings views.
The bottoms-up consensus currently sees S&P 500 earnings per share coming in at $220 this year compared with $222 in 2022.
And for all the criticism that the estimate should go down more, analysts are moving very quickly compared with recent history.
From June 2022 to now, analysts have slashed their 2023 EPS estimates by 12%, on pace for the sharpest decline in full-year outlooks since 2010, data compiled by RBC Capital Markets show.
“Analysts’ estimates have come down a lot, possibly setting the market up for some pleasant surprises,” Nicholas Colas, co-founder of DataTrek Research, said in a note to clients. “If those fail to materialize, we are looking at another wave of reductions in earnings estimates, and no amount of sector rotation performance chasing will fill the hole left by that issue.”
Key events this week:
* Canada rate decision, Wednesday
* EIA crude oil inventories, Wednesday
* China CPI, PPI, Thursday
* US Challenger job cuts, initial jobless claims, household change in net worth, Thursday
* Bank of Japan policy rate decision, Friday
* US nonfarm payrolls, unemployment rate, monthly budget statement, Friday

Some of the main moves in markets:
Stocks
* The S&P 500 rose 0.1% as of 4 p.m. New York time
* The Nasdaq 100 rose 0.5%
* The Dow Jones Industrial Average fell 0.2%
* The MSCI World index fell 0.1%
Currencies
* The Bloomberg Dollar Spot Index was little changed
* The euro was little changed at $1.0548
* The British pound rose 0.2% to $1.1848
* The Japanese yen was little changed at 137.25 per dollar
Cryptocurrencies
* Bitcoin rose 0.2% to $22,093.4
* Ether rose 0.6% to $1,559.44
Bonds
* The yield on 10-year Treasuries advanced one basis point to 3.98%
* Germany’s 10-year yield declined five basis points to 2.65%
* Britain’s 10-year yield declined six basis points to 3.77%
Commodities
* West Texas Intermediate crude fell 1.4% to $76.51 a barrel
* Gold futures were little changed
This story was produced with the assistance of Bloomberg Automation.
–With assistance from Isabelle Lee, Vildana Hajric and Elena Popina.

Have a lovely evening.

Be magnificent!
As ever,

Carolann
A woman’s guess is much more accurate than a man’s certainty. –Rudyard Kipling, 1865-1936.

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
(C): 250.881.0801
Toll Free: 1.877.430.5895
Fax: 778.430.5828
www.carolannsteinhoff.com