May 16th, 2011 Newsletter
Dear Friends, Perhaps because I bought lots of Coca Cola shares today, I thought of this poem…. It is one of my all time favorites – maybe my favorite love poem – written by Frank O’Hara in 1966.
Having a Coke with You is even more fun than going to San Sebastian, Irún, Hendaye, Biarritz, Bayonne or being sick to my stomach on the Travesera de Gracia in Barcelona partly because in your orange shirt you look like a better happier St. Sebastian partly because of my love for you, partly because of your love for yoghurt partly because of the fluorescent orange tulips around the birches
partly because of the secrecy our smiles take on before people and statuary
it is hard to believe when I’m with you that there can be anything as still
as solemn as unpleasantly definitive as statuary when right in front of it
in the warm New York 4 o’clock light we are drifting back and forth
between each other like a tree breathing through its spectacles and the portrait show seems to have no faces in it at all, just paint
you suddenly wonder why in the world anyone ever did them
I look at you and I would rather look at you than all the portraits in the world except possibly for the Polish Rider occasionally and anyway it’s in the Frick which thank heavens you haven’t gone to yet so we can go together the first time and the fact that you move so beautifully more or less takes care of Futurism just as at home I never think of the Nude Descending a Staircase or at a rehearsal a single drawing of Leonardo or Michelangelo that used to wow me and what good does all the research of the Impressionists do them when they never got the right person to stand near the tree when the sun sank or for that matter Marino Marini when he didn’t pick the rider as carefully as the horse it seems they were all cheated of some marvelous experience which is not going to go wasted on me which is why I am telling you about it
– Frank O’Hara
photos of the day
May 16, 2011
British artist Tracey Emin stands in front of some of her neon artwork at the Hayward Gallery, in London. The exhibition is her first major exhibition in London, and features key works from all periods of the artist’s career, including seldom-seen early works and more recent large-scale installations.
Kirsty Wigglesworth/AP
The space shuttle Endeavour lifts off from Kennedy Space Center at Cape Canaveral, Florida.
John Raoux/AP
Market Commentary:
Canada
By Matt Walcoff
May 16 (Bloomberg) — Canadian stocks rose for the first time in five days as gold producers gained amid concern that Europe’s debt woes will worsen and TMX Group Inc. received a new takeover offer.
Goldcorp Inc., the world’s second-biggest producer of the metal by market value, gained 2.1 percent. TMX Group Inc., the owner of the Toronto Stock Exchange, advanced 5.5 percent after receiving a takeover bid from a group of Canadian banks and pension funds. Quadra FNX Mining Ltd., which produces base metals in the U.S., Canada and Chile, soared 5.8 percent after agreeing to form a joint venture with Sumitomo Metal Mining Co. and Sumitomo Corp.
The Standard & Poor’s/TSX Composite Index increased 14.19 points, or 0.1 percent, to 13,391.35 at 4:00 p.m. in Toronto.
“The Toronto market had been oversold,” said David Baskin, president of Baskin Financial Services Inc. in Toronto, which manages about C$8 billion ($8.2 billion). “You’re seeing a bit of a bounce back today. People got so pessimistic on all the commodities. When the commodities-futures guys increased the margin requirements, especially on silver, it may have caused some spillover to the other metals.”
The S&P/TSX index fell 2.2 percent from May 9 to May 13 on drops in oil, gold and copper and concern inflation may lead to higher interest rates in China. Only the Athens Stock Exchange General Index has dropped more than the S&P/TSX this quarter among developed-market stock benchmarks.
Gold producers gained today as European finance ministers, meeting in Brussels, pushed Greece to do more to address its debt before receiving more aid. The country should sell assets “before calling for more money,” Austrian Finance Minister Maria Fekter told reporters before the meeting.
Goldcorp advanced 2.1 percent to C$47.24. Iamgold Corp., which mines in Africa, South America and Quebec, increased 2.4 percent to C$18.65. Yamana Gold Inc., Canada’s fifth-biggest gold producer, climbed 1.2 percent to C$11.60.
TMX rallied 5.5 percent to C$44.05 after Maple Group Acquisition Corp., which comprises four banks and five pension funds, bid C$48 a share in cash and stock for the exchange owner. TMX agreed in February to a C$39-a-share all-stock bid from London Stock Exchange Group Plc.
Toronto-Dominion Bank, the largest lender among the Maple investors, increased 0.7 percent to C$82.27. Royal Bank of Canada, the country’s biggest bank, climbed 0.6 percent to C$58.82.
Base-metal and coal producers rose as copper gained for a third day. Teck Resources Ltd., Canada’s largest company in the industry, advanced 0.8 percent from a six-month low to C$45.19
SouthGobi Resources Ltd., which mines coal in Mongolia, surged 5.6 percent to C$11.33 after sinking 30 percent in the three months ending May 13. Last week, the company forecast higher sales prices and volumes.
First Quantum Minerals Ltd., Canada’s second-biggest publicly traded copper producer, increased 4.6 percent to C$128.76 as analysts at Citigroup Inc. recommended buying the shares after their 13 percent tumble from April 6 to May 13.
Quadra FNX climbed 5.8 percent to C$14.48. Sumitomo Metal Mining and Sumitomo Corp. will buy a 45 percent stake and invest $724 million in the Sierra Gorda copper-molybdenum project in Chile.
Fertilizer producers rose as wet weather delayed spring corn planting in the northern U.S. Potash Corp. of Saskatchewan Inc., the world’s largest fertilizer producer by market value, gained 2.1 percent to C$50.96. Agrium Inc. advanced 0.8 percent to C$78.65.
Sino-Forest Corp. gained 5.6 percent to C$20.27 after the stock was rated “outperform” by BMO equity analyst Stephen Atkinson.
Home-builder Brookfield Residential Properties Inc. surged 11 percent to C$10.94 after Barron’s said the stock “looks inexpensive relative to both earnings and book value.”
US
By Rita Nazareth
May 16 (Bloomberg) — U.S. stocks retreated, extending a two-week slump for the Standard & Poor’s 500 Index, as Greece sought additional bailout funds and a report showed that manufacturing growth in the New York region cooled.
Lowe’s Cos., the second-largest U.S. home improvement retailer, dropped 3.6 percent after cutting its full-year earnings forecast. NYSE Euronext tumbled 13 percent as Nasdaq OMX Group Inc. and IntercontinentalExchange Inc. pulled their takeover bid. AMR Corp. and JetBlue Airways Corp. added at least 4.8 percent after JPMorgan Chase & Co. raised its ratings for the companies, citing prospects for lower fuel costs.
The S&P 500 dropped 0.6 percent to 1,329.47 at 4 p.m. in New York after gaining as much as 0.4 percent. The Dow Jones Industrial Average slumped 47.38 points, or 0.4 percent, to 12,548.37. The 30-stock gauge declined during the first two weeks of a month for the first time since July 2009.
“There’s concern about a soft spot,” said Burt White, who helps oversee $284 billion as chief investment officer at LPL Financial Corp. in Boston. “We are starting to see a peak in manufacturing and margins. In addition, there’s the European debt crisis. They’ve been trying to deal with the symptoms, without curing the disease. It’s not an easy fix. The market has had a big run, with both stocks and commodities up a lot. The bigger the party, the tougher the hangover.”
U.S. stocks fell last week as concern over Europe’s debt crisis deepened and inflation reports spurred speculation global interest rates will rise. Still, the S&P 500 has advanced 5.7 percent in 2011 after 72 percent of the 435 companies that reported results since April 11 topped the average analyst earnings projection, according to data compiled by Bloomberg.
While the S&P 500 has rallied 5.8 percent since its year- to-date low on March 16, the gains have been led by so-called defensive industries that are thought to hold up better during an economic slowdown. Health-care companies, consumer firms that sell necessities, telephone operators and utilities have risen at least 9.9 percent, the most among 10 industry groups in the S&P 500. Financial and energy companies have been the worst performances.
European finance chiefs endorsed a 78 billion-euro ($111 billion) bailout for Portugal. Authorities stepped up the pressure on Greece to sell assets and deepen spending cuts to win an increase of its 110 billion-euro ($156 billion) aid package and more time to repay the loans.
“They are putting a patch on the problem,” said Matthew DiFilippo, director of research at Stewart Capital Advisors LLC in Indiana, Pennsylvania, which manages $1 billion. “I don’t really see there’s a way that they can fix it without a restructuring. Investors are an emotional group of people. I wouldn’t be surprised to see some market strength on efforts to give them a longer lifeline.”
In deliberations clouded by the absence of International Monetary Fund Managing Director Dominique Strauss-Kahn, Europe’s rich countries also weighed whether to make holders of Greek bonds assume some losses. The IMF named John Lipsky as acting managing director yesterday after Strauss-Kahn was charged with the attempted rape of a New York hotel maid. Strauss-Kahn, 62, has denied the charges and will plead not guilty, his lawyer Benjamin Brafman said.
Bill Gross, who runs the world’s biggest bond fund at Pacific Investment Management Co., said Greece is the world’s biggest candidate for default.
“We suggest that Greece is insolvent and that at some point the can cannot be kicked down the road any further,” said Gross in an “InBusiness with Margaret Brennan” interview on Bloomberg Television. “Ultimately debt holders will have to bear some of the burden as well.”
Stocks also fell as a report showed that manufacturing in the New York region expanded at a slower pace than anticipated in May as the cost of raw materials surged. The Federal Reserve Bank of New York’s general economic index fell to 11.9 from a one-year high of 21.7 in April. Economists in a Bloomberg News survey projected it would drop to 19.6, according to the median forecast. Readings greater than zero signal growth.
Lowe’s dropped 3.6 percent to $24.84. Economic pressures and bad weather lowered sales, Lowe’s said. Home prices fell in more than three-fourths of U.S. cities in the first quarter, hurt by foreclosures selling at cut-rate prices, the National Association of Realtors said May 10. The decline and rising fuel bills deterred homeowners from undertaking major projects on their houses.
NYSE Euronext tumbled 13 percent to $35.73. Nasdaq and ICE pulled their bid for NYSE Euronext after talks with U.S.
regulators showed they wouldn’t secure antitrust approval, clearing the path for Deutsche Boerse AG. NYSE Euronext agreed to be bought by the Frankfurt-based bourse on Feb. 15, a merger that would create the world’s largest exchange operator. The NYSE board twice rejected a rival proposal from Nasdaq and ICE, saying the unsolicited offer would lead to too much debt and regulatory opposition.
“It became clear that we would not be successful in securing regulatory approval for our proposal despite offering a variety of substantial remedies,” Bob Greifeld, chief executive officer of Nasdaq, said in a statement.
AMR gained 4.9 percent to $6.69, while JetBlue rose 5.6 percent to $6.14. JPMorgan raised its recommendation for the carriers to “overweight” from “neutral.”
UBS AG lifted its estimates for combined profit by companies in the S&P 500 for this year and 2012 on productivity growth, share buybacks, rising oil prices and strength in emerging markets.
Thomas Doerflinger, a New York-based strategist for UBS, lifted his earnings estimate for 2011 to $101 a share from $96, and to $108 from $104 for next year. Better-than-forecast profit from energy companies account for 68 percent of the increase, he wrote in a note dated today. Profit estimates from technology stocks made up about 30 percent of the boost, he said.
Have a wonderful evening everyone.
Be magnificent!
When the mind and intellect developed, man asked,
Who am I? Who is it before me?
The search for reality began…
Moving one step towards finding the answer to the question,
Who am I, we brought consciousness from outside to inside.
Wisdom turned the direction of the consciousness within and
we perceived our soul.
The journey of the soul in the outer world was over and the journey within had begun.
-Acharya Mahaprajna, 1920-2010
As ever,
Carolann
Your time is limited, so don’t waste it living
someone else’s life. Don’t be trapped by dogma –
which is living with the results of other people’s
thinking. Don’t let the noise of others’ opinions
drown out your own inner voice. And most
important, have the courage to follow your heart
and intuition. They somehow already know what
you truly want to become. Everything else is
secondary.
-Steve Jobs, 1955-
Carolann Steinhoff, B.Sc., CFP, CIM, FCSI
Senior Vice-President &
Senior Investment Advisor