May 12, 2017 Newsletter

Dear Friends,

Tangents:
Annually on May 12, National Limerick Day celebrates the birthday of English artist, illustrator, author and poet Edward Lear (May 12, 1812 – Jan. 29, 1888).  Lear is known mostly for his literary nonsense in poetry, prose and limericks.
National Limerick Day also celebrates the limerick poem.  Limerick poems were popularized by Edward Lear’s book “Book of Nonsense” in 1846.
A limerick is a very short, humorous, nonsense poem. Within a limerick, there are five lines.  The first two lines rhyme with the fifth line and the third and fourth line rhyme together.

There was a Young Lady whose chin
Resembled the point of a pin;
So she had it made sharp, and purchased a harp,
And played several tunes with her chin.

There was an old man with a beard
Who said “It is just as I feared!”
Two owls and a hen
Four Larks and a wren
Have all built their nests in my beard.

TODAY IN HISTORY
On May 12, 1943, during World War II, Axis forces in North Africa surrendered.

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PHOTO OF THE DAY

Royal attendants carried seed rice during a royal plowing ceremony in Bangkok, Thailand, today. The annual event – dating back some 700 years – marks the beginning of the growing season for rice in Thailand. The country produces some 30 million tons of rice a year and is the world’s No. 2 rice exporter, after India.
Sakchai Lalit/AP
Market Closes for May 12^th, 2017

International Markets

Bonds

Currencies

Commodities

Market Commentary:
On this day in 1817, the Warsaw Stock Exchange opens for trading in Warsaw, Poland, handling primarily government and corporate bonds.
Number of the Day
17.52%
The percent decline in Macy’s shares, the largest decrease in its stock since October 2010. At $24.31, it was also the lowest close for Macy’s stock since August 2011.
Canada
By Lu Wang
     (Bloomberg) — Canadian stocks fell, with the benchmark index staging a third straight weekly decline, as financial firms extended losses that were triggered by a Moody’s Investors Service credit downgrade of the country’s largest banks.
     The S&P/TSX Composite Index slipped 0.1 percent to 15,537.88 at 4 p.m. in Toronto. The measure is down 0.3 percent over five days, the worst week since mid-April.
     In other moves:
* Home Capital Group Inc. dropped 15 percent. The mortgage lender said on a conference call that a few companies have expressed interest, but it’s not rushing to make a deal.
* Hudson’s Bay Co. dropped 4.6 percent. The owner of Saks Fifth Avenue said first-quarter sales were difficult because of lower store traffic, a promotional environment and the continued shift to online shopping. Same-store sales fell 2.9 percent on a constant currency basis.
* Badger Daylighting Ltd. sank 14 percent. The provider of non- destructive excavating services reported first-quarter earnings that missed analyst estimates.
* Ithaca Energy Inc. jumped 22 percent after saying Delek Group intends to offer C$1.95 per share for the stock it doesn’t already own.
US
By Brian Chappatta
     (Bloomberg) — The dollar fell while Treasuries rallied after tepid data on retail sales and inflation in the U.S. economy rekindled concern that growth won’t accelerate to levels economists project. U.S. stocks ended the day mixed, gold erased a weekly loss, and crude stayed below $48 a barrel.
     The S&P 500 Index fell as Nordstrom Inc. became the latest retailer to miss earnings estimates. Small caps retreated 1 percent in the week, while technology shares edged higher. The dollar pared a weekly gain, while 10-year Treasury yields fell to 2.32 percent after retail sales in April rose less than forecast and inflation slowed. The Bloomberg Commodity Index rose for a third day, recovering from a 16-month low. European stocks struggled for direction following the biggest drop in three weeks Thursday.
     Consumer prices rebounded last month, though at a slower pace than expected, while retail sales advanced after an unexpected drop in March. That was enough to bolster the case for Federal Reserve tightening in June, though not enough to ignite stocks or upset bonds. Investors cast a wary eye on Washington, where President Donald Trump escalated his war with fired FBI director James Comey at the same time his cabinet attempted to move forward on trade and regulatory reforms.
     Read our Markets Live blog here.
     Here are key events investors will be watching:
* Chinese President Xi Jinping hosts world leaders including Russian President Vladimir Putin at a summit promoting his $500 billion trade-and-infrastructure plan, which is called the Belt and Road Initiative. The summit begins Sunday and will showcase Xi’s plans to remake global trade patterns in China’s favor.
     Here are the main moves in markets:
     Stocks
* The S&P 500 fell 0.2 percent to end the week at 2,390.67 at 4 p.m. in New York. The index lost 0.4 percent in the period, the first slide in four weeks.
* The Nasdaq Composite Index capped a weekly gain with a rise of 0.1 percent. Small caps in the Russell 2000 Index sank 1 percent in the five days.
* The Stoxx Europe 600 rose 0.3 percent to turn in a gain of the same amount in the five days.
* The MSCI Emerging Market Index rose 0.3 percent to cap a fifth straight advance, its longest rally since March. The measure climbed to the highest in 11 months.

      Currencies
* The Bloomberg Dollar Spot Index slipped 0.3 percent. It rose 0.4 percent in the past five days, the first weekly advance in a month.
* The yen added 0.5 percent to 113.289 per dollar, trimming its drop for the week.
* The euro gained 0.6 percent to $1.0929, to pare a weekly decline to 0.6 percent.

     Bonds
* The yield on 10-year Treasury notes fell six basis points to 2.32 percent, after retreating three basis points Thursday. That left the rate lower by two basis points in the week.
* The five-year breakeven rate, which measures the yield spread between Treasuries and Treasury Inflation Protected Securities, fell about 0.06 percentage point Friday, on pace for the biggest drop since June, while the 10-year gauge sank the most this year.
* Benchmark yields in France, Germany and the U.K. dropped.

     Commodities
* Oil’s rebound ran out of steam as investors focus on all the production that OPEC can do nothing about. Crude capped the first weekly gain with an advance of 1 cent Friday to settle at $47.84.
* West Texas Intermediate rose 3.4 percent in the week, but is down 11 percent in 2017.
* Gold advanced 0.3 percent to settle at $1,227.70 an ounce in New York for a third straight day of gains. The metal rose 0.1 percent in the week after touching the lowest level since mid- March on Tuesday.
* Aluminum rose as China’s top state smelter suspends production capacity of intermediate material alumina. London aluminum added 0.9 percent to settle at $1,891 a ton.
* Cotton prices jumped to the highest in almost three years amid signs of tightening global supplies and buoyant demand as exports reached a government target in the U.S., the world’s biggest shipper.

Have a wonderful weekend everyone.

Be magnificent!

There will have to be rigid and iron discipline
before we achieve anything great and enduring,
and that discipline will not come by mere academic argument
and appeal to reason and logic.
Discipline is learnt in the school of adversity.
Mahatma Gandhi

As ever,

Carolann

Not on one strand are life’s jewels strung.
                 -William Morris, 1834-1896

Carolann Steinhoff, B.Sc., CFP®, CIM, CIWM
Portfolio Manager &
Senior Vice-President

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
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www.carolannsteinhoff.com