May 12, 2021 Newsletter

Dear Friends,

Tangents: Limerick Day.
Edward Lear, b. 1812.
Limerick Day is observed on the birthday of one of its champions, Edward Lear.  The limerick, which dates from the early 18^th century, has been described as the “only fixed verse form indigenous to the English language.  It gained its greatest popularity following the publication of Edward Lear’s Book of Nonsense.

The profs of our great university
Display the most striking diversity:
Some wise and some foolish,
Some saintly, some ghoulish, and some of the utmost perversity.
   ~From The Art of the Limerick by Cyril Bibby.

Florence Nightingale, b. 1820
Kate Hepburn, actress, b. 1907

On May 12, 1943, during World War II, Axis forces in North Africa surrendered.  Go to article »

Voyager spacecraft detects ‘persistent hum’ beyond our solar system.  Interstellar beings, if you’re trying to contact us, we’re kind of sorting through our own problems right now. 

PHOTOS OF THE DAY

Owner Philip Brind leads the single horse-power Ross along the Grand Western Canal towpath in Devon, assisted by crew and horseman Lauren Brinsden-Miles, as one of Britain’s last canal boat companies get ready for a grand reopening in June
CREDIT: MARK PASSMORE/APEX

Muslims use telescopes to look for the position of the moon to mark the end of the holy month of Ramadan, ahead the Eid al-Fitr festival, at Al-Musyari’in mosque in Jakarta, Indonesia
CREDIT: WILLY KURNIAWAN/REUTERS

This bizarre fish, thought to be a Pacific Football Fish, was found on the sand on the shore of Crystal Cove State Park’s Marine Protected Area in Laguna Beach, California, USA. The Pacific Football Fish is one of over 200 species of angler globally, according to California State parks, and can normally be found in the lower reaches of the ocean where no light reaches.

Market Closes for May 12^th, 2021

International Markets

Bonds

Currencies

Commodities

Market Commentary:
     On this day in 1817, the Warsaw Stock Exchange opened for trading in Poland, handling primarily government and corporate bonds. Initially, a mere one hour of trading, from 12 noon until 1 p.m., served to fill all the buy and sell orders.
Canada
By Aoyon Ashraf
(Bloomberg) — Canadian shares fell for a third day along with U.S. equities on inflation concerns after a higher than expected uptick in U.S. consumer prices. The S&P/TSX Composite index fell 0.9% in Toronto to lowest since April 23. All of the stock sectors fell, except energy as oil prices climbed. Meanwhile, Canadians are so alarmed by the red-hot housing market that many say they’d like to see the central bank raise the cost of borrowing to dampen demand for real estate and stabilize prices.
Commodities
* Western Canadian Select crude oil traded at about a $12.50 discount to West Texas Intermediate
* Spot gold fell about 1% to $1,819.87 an ounce
FX/Bonds
* The Canadian dollar fell 0.2% to C$1.2129 per U.S. dollar
* The 10-year Canada government bond yield rose about 6 basis points to 1.598%

By Bloomberg Automation:
     (Bloomberg) — The S&P/TSX Composite fell for the third day, dropping 0.9 percent, or 166.27 to 19,107.77 in Toronto. The move was the biggest since falling 1.1 percent on March 4. Today, materials stocks led the market lower, as 10 of 11 sectors lost; 177 of 229 shares fell, while 50 rose. Shopify Inc. contributed the most to the index decline, decreasing 2.0 percent. BRP Inc. had the largest drop, falling 10.4 percent.
Insights
* The index advanced 28 percent in the past 52 weeks. The MSCI AC Americas Index gained 43 percent in the same period
* The S&P/TSX Composite is 2.2 percent below its 52-week high on May 10, 2021 and 34.7 percent above its low on May 14, 2020
* The S&P/TSX Composite is down 1.1 percent in the past 5 days and fell 0.5 percent in the past 30 days
* S&P/TSX Composite is trading at a price-to-earnings ratio of 24.2 on a trailing basis and 17 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$3.02t
* 30-day price volatility rose to 9.75 percent compared with 9.31 percent in the previous session and the average of 8.84 percent over the past month
================================================================
| Index Points | |
Sector Name | Move | % Change | Adv/Dec
================================================================
* Materials | -55.7863| -2.2| 6/46
* Industrials | -30.2342| -1.3| 3/27
* Financials | -25.8462| -0.4| 6/21
* Information Technology | -23.2454| -1.3| 2/9
* Consumer Discretionary | -11.5563| -1.5| 2/10
* Utilities | -9.0883| -1.0| 3/13
* Real Estate | -6.9577| -1.1| 2/23
* Communication Services | -6.2746| -0.7| 1/7
* Health Care | -5.6405| -2.3| 2/8
* Consumer Staples | -0.2209| 0.0| 8/5
* Energy | 8.5908| 0.3| 15/8

US
By Kamaron Leach and Vildana Hajric
(Bloomberg) — U.S. stocks slumped for a third day and bond yields climbed after a report showed inflation rose more than forecast, adding to concern that price pressures will stifle a recovery in the world’s biggest economy. The technology sector continues to lead the retreat in equities, with Apple and Microsoft pacing declines in the Nasdaq 100.  Cathie Wood’s ARK Innovation ETF resumed its slide, bringing this year’s loss to about 18%. After closing at a record high on Friday, the benchmark S&P 500 slumped the most since Feb. 25. Energy was the only one of the 11 industry sectors in the green. Treasury yields moved briefly off the highs of the day after a successful 10-year note auction. “The markets have been hovering around all-time highs with a lot of the reopening trade already priced in,” said Mike Loewengart, managing director of investment strategy at E*Trade Financial.  “So it’s not out of the question that the outsized inflation read could bring us back down to earth a bit.”
The debate over whether inflation will be persistent enough to force the Federal Reserve to tighten policy sooner than current guidance suggests comes as abundant stimulus has powered a rally in global equities, raising concerns valuations had become expensive. Fed Vice Chair Richard Clarida said he was surprised by the rise in consumer prices and “we would not hesitate to act” to bring inflation down to its goals if needed. The consumer price index increased 0.8% from the prior month after a 0.6% gain in March. Excluding the volatile food and energy components, the so-called core CPI rose 0.9% from March. “The CPI data point feeds into a myopic narrative that the U.S. is overheating and the Fed is one step away from tightening,” said Mike Bailey, director of research at FBB Capital Partners. “Bears will feast on this tightening theme in the short term, but my sense is inflation will prove fleeting and markets will revert back to a more bullish view of moderate growth and lower risk of Fed tightening until we get to a full recovery.”
Elsewhere, the claim among advocates that Bitcoin is an inflation hedge appears to be in question after the CPI report. The digital asset slumped as much as 5.8% to around $53,600. European stocks closed mostly higher, lifted by optimism about economic re-openings and booming commodities. Copper and iron ore were on course for new records amid a broadening commodities boom. Oil was steady above $65 per barrel. The biggest U.S. pipeline is still closed in the wake of a cyberattack, leading to acute fuel shortages in some parts of the nation.

These are some of the main moves in markets:
Stocks
* The S&P 500 fell 1.8%, falling for the third straight day, the longest losing streak since March 4 as of 3:05 p.m. New York time
* The Nasdaq 100 fell 2.5%, falling for the third straight day, the longest losing streak since May 5
* The Dow Jones Industrial Average fell 1.6%, more than any closing loss since Feb. 25
* The MSCI World index fell 1.5%, more than any closing loss since Jan. 29
Currencies
* The Bloomberg Dollar Spot Index rose 0.6%, more than any closing gain since April 30
* The euro slipped 0.6%, more than any closing loss since April 30
* The British pound slipped 0.6%, more than any closing loss since April 30
* The Japanese yen slipped 0.9%, more than any closing loss since March 4
Bonds
* The yield on 10-year Treasuries advanced seven basis points, more than any closing gain since March 12
* Germany’s 10-year yield advanced four basis points, climbing for the sixth straight day, the longest winning streak since Feb. 8
* Britain’s 10-year yield advanced five basis points, more than any closing gain since March 12
Commodities
* West Texas Intermediate crude rose 1%, climbing for the fourth straight day, the longest winning streak since April 15
* Gold futures fell 0.9% to $1,820 an ounce

–With assistance from Claire Ballentine.
Have a great evening.

Be magnificent!

As ever,

Carolann

There will come a time when you believe everything is finished; that will be the beginning. –Louis Dearborn L’Amour,1908-1988

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