May 2, 2024, Newsletter

Dear Friends,

Tangents: Happy Friday Eve.  Robert’s Rules of Order Day.

May 2, 1611: King James Bible first published.
May 2, 1989: The Iron Curtain begins to crumble as Hungary dismantles its border fence.
1932: Pearl S. Buck wins the Pulitzer Prize.
1941: General Mills began shipping a new cereal called “Cheerioats” to six test markets. (The cereal was later renamed “Cheerios.”) The home of Cheerios is Buffalo, NY.  Go to article >>

Leonardo da Vinci, d. 1519.
Henry M. Robert, General, b.1837.
Benjamin Spock, pediatrician, b. 1903.
Naomi Campbell, model, b. 1970.

Stunning image shows atoms transforming into quantum waves — just as Schrödinger predicted
A new imaging technique, which captured frozen lithium atoms transforming into quantum waves, could be used to probe some of the most poorly understood aspects of the quantum world. Read More.

Rare ‘Excalibur’ sword from Spain dates to Islamic period 1,000 years ago
The sword is the first weapon from the Islamic period to be found in the Spanish city of Valencia. Read More.

Sun’s chaotic peak triggers record-breaking ‘global auroras’ on Mars
Mars has had frequent planet-wide auroras in recent months, including an unprecedented trio of events in February. Experts say the sudden increase is the result of the ongoing solar maximum. Read More.

See up to 50 ‘shooting stars’ per hour as the Eta Aquarid meteor shower peaks
The Eta Aquarid meteor shower will peak this weekend, bringing up to 50 “shooting stars” per hour to the sky Saturday night and early Sunday (May 4 – 5). Read More.

Princess Charlotte turns 9
The Prince and Princess of Wales released this sweet photo of their daughter to mark the occasion.

Scientists reveal the face of a Neanderthal who lived 75,000 years ago
A Neanderthal was buried 75,000 years ago, and experts painstakingly pieced together what she looked like. See the images here.

PHOTOS OF THE DAY

Frankfurt, Germany
The sun rises behind a small television tower on the outskirts of the city
Photograph: Michael Probst/AP

Florida, US
‘Inside the St Augustine Lighthouse. I really liked the black rails against the stark white walls and the spaciousness inside, which made the curved stairwell look very graceful.’
Photograph: Joy Scovell

​​​​​​​Whitby, UK
‘Getting my daily exercise walking around the abbey, which just happens to be by the brewery.’
Photograph: Howard Green
Market Closes for May 2^nd, 2024

International Markets

Bonds

Currencies

Commodities

Market Commentary:
📈 On this day in 1963: Edward C. Johnson II, the head of Fidelity Investments, started a small mutual fund and gave it to his son, Ned, to run. He called it the Magellan Fund, and its success helped popularize mutual funds.
Canada
By Bloomberg Automation
(Bloomberg) — The S&P/TSX Composite rose for the second day, climbing 0.4%, or 94.68 to 21,823.22 in Toronto.
The move was the biggest since rising 0.6% on April 23.
Royal Bank of Canada contributed the most to the index gain, increasing 1.3%.
Thomson Reuters Corp. had the largest increase, rising 6.9%.
Today, 136 of 223 shares rose, while 83 fell; 8 of 11 sectors were higher, led by industrials stocks.
Insights
* So far this week, the index fell 0.7%
* The index advanced 6.9% in the past 52 weeks. The MSCI AC Americas Index gained 23% in the same period
* The S&P/TSX Composite is 2.5% below its 52-week high on April 9, 2024 and 16.8% above its low on Oct. 27, 2023
* The S&P/TSX Composite is down 0.3% in the past 5 days and fell 1.1% in the past 30 days
* S&P/TSX Composite is trading at a price-to-earnings ratio of 18.2 on a trailing basis and 14.8 times estimated earnings of its members for the coming year
* The index’s dividend yield is 3.1% on a trailing 12-month basis
* S&P/TSX Composite’s members have a total market capitalization of C$3.45t
* 30-day price volatility rose to 8.77% compared with 8.68% in the previous session and the average of 7.96% over the past month
================================================================
| Index Points | |
Sector Name | Move | % Change | Adv/Dec
================================================================
Industrials | 41.2788| 1.4| 20/6
Energy | 31.8678| 0.8| 35/5
Financials | 11.6082| 0.2| 14/13
Utilities | 9.4672| 1.2| 13/2
Information Technology | 7.7831| 0.4| 5/5
Real Estate | 4.0418| 0.9| 13/7
Consumer Discretionary | 1.7417| 0.2| 10/3
Consumer Staples | 1.5257| 0.2| 6/5
Health Care | -1.6816| -2.5| 3/1
Communication Services | -2.3319| -0.3| 3/2
Materials | -10.6264| -0.4| 14/34
================================================================
| | |Volume VS| YTD
|Index Points| | 20D AVG | Change
Top Contributors | Move |% Change | (%) | (%)
================================================================
RBC | 17.4300| 1.3| -19.1| 1.3
Thomson Reuters | 14.9700| 6.9| 173.8| 15.0
Shopify | 13.8600| 1.7| -5.9| -4.5
Canadian Natural Resources | -4.7310| -0.6| -59.9| 17.9
Constellation Software | -9.9530| -2.0| 34.8| 7.9
TD Bank | -16.4000| -1.6| -44.1| -7.2
US
By Rita Nazareth
(Bloomberg) — The world’s largest technology companies drove stocks higher ahead of Apple Inc.’s earnings, with traders also gearing up for Friday’s jobs report.
Bonds climbed, while the dollar dropped the most in 2024.
Equities halted a two-day drop, with Nvidia Corp. leading a rally in chipmakers and Apple up 2.3%.
Wall Street expects the iPhone maker to announce a buyback, following the steps of fellow big techs Alphabet Inc. and Meta Platforms Inc.
Any news related to artificial-intelligence features could provide additional excitement for a stock that has tumbled 10% this year.
In the run-up to the monthly employment report, data showed US labor costs jumped the most in a year as productivity gains slowed, adding to risks inflation will remain elevated.
Economists surveyed by Bloomberg forecast a 240,000 gain in nonfarm payrolls, which would be the slowest pace since November.
The Fed decided Wednesday to leave the target range for the benchmark rate at 5.25% to 5.5% following a slew of data that pointed to lingering price pressures.
Yet Chair Jerome Powell said it’s unlikely that the Fed’s next move would be to raise rates.
“While the Fed appears to have all but ruled out a rate hike, it also made clear it’s willing to keep rates higher for longer,” said Chris Larkin at E*TRADE from Morgan Stanley.
“The markets will be hungry for any data suggesting the economy isn’t heating up any more than it did in the first quarter.”
The S&P 500 topped 5,060, while the Nasdaq 100 added 1.3%.
Qualcomm Inc., the world’s biggest seller of smartphone processors, surged on an upbeat forecast.
eBay Inc. slumped on a disappointing outlook.
Treasury 10-year yields fell five basis points to 4.57%.
A survey conducted by 22V Research shows that30% of the investors polled think Friday’s jobs report will be “risk-on,” 27% expect a “risk-off” reaction, and 43% said “mixed/negligible.”
Among the labor indicators, the tally showed investors will be paying the most attention — by far — to average hourly earnings.
“Markets will likely still react more to a weaker print than strong data as investors have turned more hawkish,” said Oscar Munoz and Gennadiy Goldberg at TD Securities. “However, the recent string of upside surprises to economic data is unlikely to be sustained for long as expectations continue to reset higher.”
The options market is betting that stocks will swing widely after Friday’s US jobs report, which traders expect will offer more clarity on how much the Fed may cut interest rates this year.
The S&P 500 is expected to move 1.2% in either direction after the release, based on the cost of at-the-money puts and calls expiring Friday, according to Stuart Kaiser, Citigroup Inc.’s head of US equity trading strategy.
That figure, based on the prices of S&P straddles as of Wednesday’s close, is the largest implied swing ahead of an employment report since March 2023, he said.
After Wednesday’s Fed decision to hold rates, the length of the current pause reached 280 days — which remains the second-longest on record, according to Ryan Grabinski at Strategas Securities.
“Longer pauses have been constructive for equities,” Grabinski said. “The longest pause from June 2006 to September 2007 was associated with the best equity-market return. We are reaching the point where a Fed cut is probably more likely to mean issues are perking up.”
Meantime, Bank of America Corp.’s Savita Subramanian says a sturdy economy will sustain the bull-market run in US stocks even without Fed rate cuts.
“I think we’re going to a soft landing, with a reasonable market environment, maybe better growth ahead than what we’re used to, higher rates and a little bit higher inflation,” Subramanian said Thursday on Bloomberg Television.
Hedge funds are turning increasingly defensive as uncertainty around geopolitics and the path of interest rates, as well as the stock market’s April swoon, has investing pros spooked.
Positioning data shows that hedge fund added defensive equity positions to their portfolio in April at the fastest pace in eight months, while still being net sellers of global stocks, according to figures compiled by Goldman Sachs Group Inc.’s prime brokerage desk.
That snaps a four-month streak of buying.
Health care saw the biggest inflows, while consumer discretionary stocks had the largest net selling in seven months, according Goldman’s data.

Corporate Highlights:
* Peloton Interactive Inc. said Chief Executive Officer Barry McCarthy is stepping down as the company undergoes a major restructuring that will reduce its global workforce by 15% in an effort to slash costs.
* MGM Resorts International reported first-quarter sales and earnings that beat analysts’ projections, benefiting from the post-pandemic recovery in Macau and a new partnership with Marriott International Inc. that helped fill hotel rooms.
* Carvana Co. reported stronger earnings with revenue topping expectations as the company digs into its restructuring plan and regains sales momentum.
* DoorDash Inc., the largest food delivery service in the US, offered a disappointing profit forecast for the current quarter as the company invests in expanding its list of non-restaurant partners and improving efficiency.
* Moderna Inc. reported a narrower first-quarter loss than Wall Street had expected, as the biotech giant’s cost-cutting helped offset a steep decline in its Covid business.
* Apollo Global Management Inc. reported higher first-quarter profit as the firm raked in more management fees and originated a record $40 billion of private credit, a key area of growth.

Key events this week:
* Eurozone unemployment, Friday
* US unemployment, nonfarm payrolls, ISM Services, Friday
* Chicago Fed President Austan Goolsbee speaks, Friday

Some of the main moves in markets:
Stocks
* The S&P 500 rose 0.9% as of 4 p.m. New York time
* The Nasdaq 100 rose 1.3%
* The Dow Jones Industrial Average rose 0.9%
* The MSCI World index rose 1%
Currencies
* The Bloomberg Dollar Spot Index fell 0.7%
* The euro rose 0.1% to $1.0727
* The British pound was little changed at $1.2537
* The Japanese yen rose 0.9% to 153.20 per dollar
Cryptocurrencies
* Bitcoin rose 3.6% to $59,352.38
* Ether rose 2.1% to $2,999.18
Bonds
* The yield on 10-year Treasuries declined five basis points to 4.57%
* Germany’s 10-year yield declined four basis points to 2.54%
* Britain’s 10-year yield declined eight basis points to 4.29%
Commodities
* West Texas Intermediate crude was little changed
* Spot gold fell 0.7% to $2,303.82 an ounce

This story was produced with the assistance of Bloomberg Automation.
–With assistance from Ryan Vlastelica and Jessica Menton.

Have a lovely evening.

Be magnificent!
As ever,

Carolann
As a well-spent day brings happy sleep, so a life well used brings a happy death. -Leonardo da Vinci, 1452-1519.

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