May 11, 2021 Newsletter

Dear Friends,

Tangents:
May 11, 1997~ Deep Blue, a chess-playing supercomputer, defeats Garry Kasparov in the last game of the rematch, becoming the first computer to beat a world-champion chess player in a classic match format.

1998 A French mint produced the first coins of Europe’s single currency, the euro.  Go to article »

Salvador Dali, artist, b.1904
Irving Berlin, lyricist, b. 1888
Martha Graham, dancer, b. 1894

Virtual Travel : See the Russian republic of Kalmykia, where encroaching desert has transformed the landscape.

Oddball star’s strange supernova. 
PHOTOS OF THE DAY

Artist Mark Wallinger stands in the middle of his artwork ‘British Summer Time’, a human sundial in the grounds of Chiswick House and Gardens during a preview for their new artistic programme, as the attraction gets ready for the public ahead of further easing of lockdown restrictions in England
CREDIT: ANDREW MATTHEWS/PA

A large bull shark in Florida faces off with a diver
CREDIT: CAPTAINJOHNMOORE / CATERS NEWS

A member of staff looks at an 800-year-old stained glass window on loan from Canterbury Cathedral for a new exhibition, titled ‘Thomas Becket: murder and the making of a saint,’ at the British Museum in London
CREDIT: PAUL GROVER FOR THE TELEGRAPH

The Queen, without a mask, is escorted by her son and heir to the throne, Prince Charles, during the ceremony for the state opening of Parliament
CREDIT: RICHARD POHLE/POOL

Market Closes for May 11^th, 2021

International Markets

Bonds

Currencies

Commodities

Market Commentary:
     On this day in 1861, as a sign of patriotic fellowship, the New York Stock Exchange banned all trading in Confederate stocks and bonds. However, members were still free to short-sell any Union securities.
Canada
By Aoyon Ashraf
(Bloomberg) — Canadian stocks pared some of their earlier losses on Tuesday, but still ended the session in the red amid a broader equity market selloff. The S&P/TSX Composite index fell 0.5% in Toronto with consumer discretionary and real estate stocks as the worst performers, while tech and health care were the best. Meanwhile, stock-market bull Brian Belski at BMO raised his year-end target for Canadian stocks and expects the S&P/TSX Composite Index to rise 5.9% over the next seven months. He now sees the TSX ending the year at 20,500 from his previous target of 19,500.
Commodities
* Western Canadian Select crude oil traded at about a $12.85 discount to West Texas Intermediate
* Spot gold rose 0.1% to $1,838.04 an ounce
FX/Bonds
* The Canadian dollar was flat at C$1.2097 per U.S. dollar
* The 10-year Canada government bond yield rose to 1.540%

By Bloomberg Automation:
     (Bloomberg) — The S&P/TSX Composite fell for the second day, dropping 0.5 percent, or 87.84 to 19,274.04 in Toronto. Today, financials stocks led the market lower, as 8 of 11 sectors lost; 159 of 229 shares fell, while 65 rose. Royal Bank of Canada contributed the most to the index decline, decreasing 0.8 percent. Aritzia Inc. had the largest drop, falling 4.5 percent.
Insights
* The index advanced 28 percent in the past 52 weeks. The MSCI AC Americas Index gained 44 percent in the same period
* The S&P/TSX Composite is 1.4 percent below its 52-week high on May 10, 2021 and 35.9 percent above its low on May 14, 2020
* The S&P/TSX Composite is up 0.4 percent in the past 5 days and was little changed in the past 30 days
* S&P/TSX Composite is trading at a price-to-earnings ratio of 24.4 on a trailing basis and 17.2 times estimated earnings of its members for the coming year
* The index’s dividend yield is 2.7 percent on a trailing 12-month basis
* S&P/TSX Composite’s members have a total market capitalization of C$3.03t
* 30-day price volatility rose to 9.31 percent compared with 9.17 percent in the previous session and the average of 8.80 percent over the past month
================================================================
| Index Points | |
Sector Name | Move | % Change | Adv/Dec
================================================================
* Financials | -42.3419| -0.7| 4/23
* Energy | -23.1867| -0.9| 4/16
* Industrials | -21.9573| -1.0| 5/25
* Consumer Discretionary | -15.9541| -2.0| 0/13
* Real Estate | -9.4018| -1.5| 1/25
* Utilities | -6.5896| -0.7| 2/14
* Consumer Staples | -6.2495| -0.9| 4/9
* Communication Services | -4.4503| -0.5| 2/5
* Health Care | 2.3112| 0.9| 4/6
* Materials | 17.2947| 0.7| 36/15
* Information Technology | 22.7118| 1.3| 3/8

US
By Claire Ballentine and Vildana Hajric
(Bloomberg) — Energy, financial and industrials shares led U.S. stocks lower as the pullback centered in the technology sector widened while investors remained on edge over the threat of inflation. The tech-heavy Nasdaq 100 erased a loss of almost 2% to finish little changed as some dip buyers emerged. The benchmark S&P 500 dropped for a second day after setting a record high on Friday. Treasury yields edged up and the dollar traded near the lowest levels of this year. Debate rages over whether the expected jump in price pressures will be enduring enough to force the Federal Reserve into tightening policy sooner than current guidance suggests. Fed Governor Lael Brainard said policy makers must show continued patience as distortions in the post-pandemic boom sort themselves out while the economy is still far from the central bank’s objectives. “I just think that in general there’s this thought that inflation may rear its ugly head,” said JJ Kinahan, chief market strategist at TD Ameritrade. “We see a little bit higher rates, not significantly, but a bit higher rates. And I think this struggle between value and growth also continues at the same time.” Among the biggest pandemic winners, tech stocks whose valuations often depend on earnings prospects far into the future are now at the center of the inflation debate. That was epitomized in Cathie Wood’s Ark Innovation ETF, which has tumbled about 15% so far this year after surging almost 150% in 2020.
Even after the declines, the Nasdaq Composite trades at 26 times the 12-month projected profits, while the gauge of European technology shares enjoys a valuation of 29 times. Wednesday’s U.S. inflation report along with a series of U.S. government bond auctions this week are seen as the next factors to deepen or arrest the slide. The latest reading is expected to show an accelerated pace of consumer-price increases, with the year-on-year comparison made starker by the pandemic shock in 2020. “What’s interesting about tech and the selloff is that it comes in the face of stable yields, a Fed that is likely on hold for a while and some very strong earnings,” said Michael Arone, chief investment strategist for the U.S. SPDR exchange-traded fund business at State Street Global Advisors. “Markets seem to be anticipating some time of move in rates and inflation that could potentially be problematic for the tech and growth trade.” Copper prices traded near a record, while iron also rallied. Oil rose as fuel shortages are expanding across several U.S. states in the East Coast and South as filling stations run dry amid the unprecedented pipeline disruption caused by a criminal hack.
Here are some key events to watch this week:
* U.S. CPI report Wednesday is forecast to show prices continued to increase in April
* Bank of England Governor Andrew Bailey speaks Wednesday

These are some of the main moves in markets:
Stocks
* The S&P 500 fell 0.9% to the lowest since April 22 as of 4 p.m. New York time
* The Nasdaq 100 fell 0.1% to the lowest since April 1
* The Dow Jones Industrial Average fell 1.4%, more than any closing loss since Feb. 26
* The MSCI World index fell 1.2%, more than any closing loss since March 4
Currencies
* The Bloomberg Dollar Spot Index was little changed
* The euro rose 0.2% to $1.2149
* The British pound rose 0.2% to the highest in about three years
* The Japanese yen rose 0.1% to 108.66 per dollar
Bonds
* The yield on 10-year Treasuries advanced two basis points, climbing for the fourth straight day, the longest winning streak since March 19
* Germany’s 10-year yield advanced five basis points, more than any closing gain since March 3
* Britain’s 10-year yield advanced five basis points, more than any closing gain since March 18
Commodities
* West Texas Intermediate crude rose 0.7% to $65 a barrel
* Gold futures rose 0.1%, climbing for the fifth straight day, the longest winning streak since Jan. 5
–With assistance from Nancy Moran.
Have a great night.

Be magnificent!

As ever,

Carolann

Chance is the first step you take, luck is what comes afterward. –Amy Tan.

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