May 13, 2019 Newsletter

Dear Friends,

Tangents: Happy Monday!

On May 13, 1981, Pope John Paul II was shot and seriously wounded in St. Peter’s Square by Turkish assailant Mehmet Ali Agca. Go to article »
PHOTOS OF THE DAY

Cricket players from the Ship Inn and Borderers teams hold the first match of the season on the beach in Elie, Scotland.     CREDIT: STUART NICOL FOR THE TELEGRAPH

Courtney Conlogue if the US performs a manouvre on a wave one day before the start of the World Surf League women’s championship tour surfing events in Bal, Indonesia     CREDIT: SONNY YUMBELAKA/AFP/GETTY IMAGES

Yana Nestsiarava of Belarus dives from the 21 metre platform at Dun Laoghaire Harbour during the second stop of the Red Bull Cliff Diving World Series in Dublin, Ireland.     CREDIT: ROMINA AMATO/ RED BULL VIA GETTY IMAGES

A camera shy mountain hare in the Cairngorms, Scottish Highlands     CREDIT: ANDY HOWARD/SWNS
Market Closes for May 13^th, 2019

International Markets

Bonds

Currencies

Commodities

Market Commentary:
On this day in 1986, with Wall Street embracing media and retailing stocks, Home Shopping Network went public, selling 2 million shares at an initial offering price of $18. The stock closed at $47.75, up 165%, probably the highest first-day return at the time on record.
Canada
By Aoyon Ashraf
     (Bloomberg) — Canadian stocks continued to decline for a third day, after China retaliated with higher tariffs on a range of American goods. Pot stocks were the biggest losers as new Canada licensing rules may worsen a shortage.
     The S&P/TSX Composite Index fell 0.6% to 16,193. Health care and consumer discretionary sectors were the worst performers, while real estate and utilities suffered the least. Onex Corp. agreed to acquire WestJet Airlines Ltd. for C$3.5 billion ($2.6 billion), taking the Canadian carrier private in one of the buyout firm’s biggest deals.
     In other moves:
Stocks
* WestJet surged about 60% on news that the company will be acquired by Onex
* Air Canada climbed 5.5% to the highest in a year, following the WestJet acquisition
* Gold miners such as Pretium Resources gained 7.2%, as the metal rose on safe haven demand
* Eldorado Gold rose 5.5% after starting a $300 million senior secured notes offering
* Canopy Growth fell 7.6% and Cronos Group declined almost 6.3% amid new Canada licensing rules
Ratings
* ALO CN: Alio Gold Downgraded to Speculative Underperform at BMO
* AX-U CN: Artis REIT Upgraded to Outperform at BMO; PT C$12.50
* BHC CN: Bausch Health Upgraded to Neutral at JPMorgan
* BOS CN: AirBoss of America Raised to Buy at Industrial Alliance; PT C$12
* CRR-U CN: Crombie REIT Upgraded to Buy at Desjardins; PT C$16
* EFR CN: Energy Fuels Downgraded to Market Perform at Noble Capital
* MAL CN: Magellan Aerospace Downgraded to Hold at Canaccord; PT C$20
* NOA CN: NOA CN Raised to Strong Buy at Raymond James
* QSR CN: Restaurant Brands Downgraded to Underperform at Longbow
* TGL CN: TransGlobe Energy Upgraded to Buy at Arqaam Capital; PT C$2.90
Commodities
* Western Canada Select crude oil traded at a $13.35 discount to WTI
* Gold spot prices rose 1.1% to $1,299.65 an ounce
FX/Bonds
* The Canadian dollar fell 0.4% to C$1.3469 per U.S. dollar
* The Canada 10-year government bond yield retreated to 1.662%
US
By Randall Jensen and Sarah Ponczek
     (Bloomberg) — U.S. stocks and commodities tumbled after China retaliated with higher tariffs on a range of American goods. Treasuries jumped with the Japanese yen on demand for haven assets.
     The S&P 500 dropped the most in four months, the Dow Jones Industrial Average slumped more than 600 points and the Nasdaq Composite saw the biggest decline of the year after China targeted some of the nation’s biggest exporters. Both Boeing and Caterpillar Inc. fell nearly 5%, while Apple Inc. lost 5.8%. The new penalties also took aim at American farmers, driving down soybean and cotton prices. The dollar rallied and the 10-year Treasury yield fell to the lowest level since late March.
     Shares briefly came off lows during Monday’s session after President Donald Trump indicated he’ll speak with China’s Xi Jinping at the end of June during the G-20 summit and said he hasn’t yet decided about fresh tariffs on the remaining $300 billion in Chinese imports.
     Trade rattled financial markets again, with stocks sinking for the fifth time in six sessions since China’s defiance of Trump’s warning not to retaliate for his imposition of higher tariffs Friday escalated the skirmish, driving demand for havens from gold to the yen while punishing risk assets. Several banks have warned that the eruption increases the likelihood of a slowdown in global growth that would dent corporate profits.
     “China retaliating as fast as they did was a clear signal they’re not going to be pushed around,” said Samantha Azzarello, global market strategist for JPMorgan ETFs. “Markets would like a little bit more play nice and maybe even a bit of complacency from China. It was interesting it wasn’t done on the weekend. It was done just in time, Monday morning for markets to open.”
     Elsewhere, European shares dropped more than 1% after the European Union said it was finalizing a list of U.S. goods to target in the event Trump imposes levies on car imports. Oil turned lower after rising earlier on concerns about rising tensions in the Persian Gulf. Bitcoin climbed above $7,000 as the recent gains in cryptocurrencies extended over the weekend.
     Here are some notable events coming up this week:
* Earnings this week include Vodafone, Alibaba, Tencent, Cisco, Nvidia.
* New York Fed President John Williams speaks at an event in Zurich. Kansas City Fed President Esther George and Richmond Fed President Thomas Barkin also make appearances.
* Japan balance of payments is due Tuesday.
* China industrial production and retail sales are slated for Wednesday, same day as U.S. retail sales and industrial production.
* Bank of Indonesia has an interest rate decision on Thursday.
* Australian unemployment is out on Thursday.
     And here are the main market moves:
Stocks
* The S&P 500 Index decreased 2.4% as of 4 p.m. New York time, the biggest drop since Jan. 3.
* The Dow Jones Industrial Average slid 2.4%, the most since Jan. 3.
* The Nasdaq Composite Index tumbled 3.4%, the largest drop since Dec. 4.
* The Stoxx Europe 600 Index fell 1.2% to the lowest in two months.
* The MSCI Asia Pacific Index declined 0.9%.
* The MSCI Emerging Market Index decreased 1.7%.
Currencies
* The Bloomberg Dollar Spot Index rose 0.2%.
* The euro was little changed at $1.1232.
* The British pound fell 0.3% $1.2963.
* The Japanese yen jumped 0.6% to 109.33 per dollar.
Bonds
* The yield on 10-year Treasuries fell seven basis points to 2.398%, the lowest since March 28.
* Germany’s 10-year yield dipped two basis points to -0.07%.
* Britain’s 10-year yield declined three basis points to 1.10%.
Commodities
* West Texas Intermediate crude dropped 1.4% to $60.81 a barrel.
* Gold increased 1% to $1,300.10 an ounce.
–With assistance from Todd White.
Have a great night.

Be magnificent!
As ever,

Carolann

Nobody got anywhere in the world by simply being content.

                          -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