May 20, 2020 Newsletter

Dear Friends,

Tangents:
Honoré de Balzac, writer,  b.1799
Henri Rousseau, painter, b. 1844

1927: First trans-Atlantic flight, Charles Lindbergh
1932: Amelia Earhart Atlantic crossing

Longstanding mystery of matter and antimatter may be solved.
PHOTOS OF THE DAY

Punting on a private trip on the River Cam in Cambridge, England. The public punts are not yet open.
CREDIT: GEOFF ROBINSON PHOTOGRAPHY

A woolen masterpiece called The Knittingale Hospital, which has been knitted with wool by Margaret Seaman, 91, at her home in Caister- on-Sea, Norfolk. The scene has been knitted during the coronavirus lockdown to raise funds for the NHS
CREDIT: JOE GIDDENS/PA

Youtubers wearing masks of pigs films a video at a shopping district in Tokyo, Japan
CREDIT: REUTERS/KIM KYUNG-HOON
Market Closes for May 20^th, 2020 

International Markets

Bonds

Currencies

Commodities

Market Commentary:
On this day in 1862, President Abraham Lincoln signed the Homestead Act into law, enabling anyone who had farmed public land for at least five years to acquire title to 160 acres free and clear, after the payment of a minimal filing fee. The Homestead Act uncorked a flood of migration into the Midwest and West, turning the U.S. into the world’s breadbasket.
Canada
By Aoyon Ashraf
(Bloomberg) — Canadian stocks rose for a fourth consecutive session, led by the tech sector as Shopify Inc. rallied.
The S&P/TSX Composite Index gained 0.8% on Wednesday.
Shopify said it plans to launch a business account and card for merchants, adding fuel to the company’s shares which have already doubled since the beginning of the year. The stock added 2.6% in Toronto.
Energy stocks also saw a boost after oil rose for the fifth straight session as investors weighed signs the market is rebalancing against what’s still a precarious economic outlook.
Meanwhile, Prime Minister Justin Trudeau’s government is willing to take equity stakes in Canada’s largest firms in exchange for bridge financing as big business grapples with fallout from the coronavirus pandemic. Publicly traded companies seeking cash under a new financing facility will need to issue warrants that give government an option to acquire stock worth 15% of the loans, according to details of the plan released Tuesday.
Commodities
* Western Canada Select crude oil traded at a $9.75 discount to West Texas Intermediate
* Spot gold rose 0.3% to about $1,749.52 an ounce
FX/Bonds
* The Canadian dollar strengthened 0.3% to C$1.3898 per U.S. dollar
* The 10-year government bond yield fell about 3 basis points to 0.564%

By Bloomberg Automation:
(Bloomberg) — The S&P/TSX Composite rose for the fourth day, climbing 0.8 percent, or 112.15 to 14,997.63 in Toronto.
The index advanced to the highest closing level since May 11. Royal Bank of Canada contributed the most to the index gain, increasing 2.7 percent. Frontera Energy Corp. had the largest increase, rising 22.4 percent.
Today, 149 of 229 shares rose, while 78 fell; 6 of 11 sectors were higher, led by financials stocks.
Insights
* This month, the index rose 1.5 percent
* The index declined 8.6 percent in the past 52 weeks. The MSCI AC Americas Index gained 3.3 percent in the same period
* The S&P/TSX Composite is 16.5 percent below its 52-week high on Feb. 20, 2020 and 34.2 percent above its low on March 23, 2020
* The S&P/TSX Composite is up 0.8 percent in the past 5 days and rose 4.2 percent in the past 30 days
* S&P/TSX Composite is trading at a price-to-earnings ratio of 17.7 on a trailing basis and 23 times estimated earnings of its members for the coming year
* The index’s dividend yield is 3.5 percent on a trailing 12-month basis
* S&P/TSX Composite’s members have a total market capitalization of C$2.25t
* 30-day price volatility rose to 26.75 percent compared with 26.73 percent in the previous session and the average of 49.25 percent over the past month
================================================================
| Index Points | |
Sector Name | Move | % Change | Adv/Dec
================================================================
Financials | 55.5244| 1.4| 22/4
Industrials | 33.2193| 1.9| 23/7
Energy | 29.6633| 1.5| 27/3
Information Technology | 28.2561| 2.0| 7/3
Consumer Discretionary | 6.1795| 1.3| 12/2
Real Estate | 1.7153| 0.4| 17/9
Health Care | -1.7718| -1.1| 4/6
Communication Services | -2.4757| -0.3| 3/4
Consumer Staples | -3.4402| -0.5| 4/7
Utilities | -8.0847| -1.1| 6/10
Materials | -26.6307| -1.2| 24/23
US
By Vildana Hajric and Claire Ballentine
(Bloomberg) — Stocks climbed to more than 10-week highs as investors focused on signs the American economy will continue to reopen and U.S. central bankers acknowledged the severity of the coronavirus pandemic when they met last month. Crude oil rallied for a fifth day.
The S&P 500 erased all of Tuesday’s losses, with Lowe’s Cos. and Target Corp. reporting sales that topped estimates. The index pulled back from its session high after the Senate passed a bill that could bar some Chinese companies from listing on American exchanges, adding to tensions between the nations.
Gains were broad, with energy, financials and technology leading all 11 sector groups higher. The index is up more than 30% since its March low, but the advance has largely petered out in May as volatility returned. “We’re getting some great data out of places like Florida,” said John Ham, associate adviser at New England Investment and Retirement Group. “These incremental improvements are going a long way to drive this market higher as we slowly return to normal.”
U.S. central bankers saw the pandemic posing a severe economic threat and were also concerned by the risks to financial stability, minutes of the April 28-29 Federal Open Market Committee meeting showed. “The Fed is increasingly concerned about the downstream effects the pandemic has on the most powerful driver of the economy — the consumer,” said Mike Loewengart, managing director of investment strategy at E*Trade Financial. “And while the Fed’s stimulus packages along with the CARES Act have giventhe economy a bit of a boost, they’re not afraid to lean on what’s left in their toolkit for more fiscal support.”
The Stoxx Europe 600 Index erased an early decline to close higher. The euro posted its fourth straight advance versus the dollar, as expectations built for the approval of a region-wide stimulus plan. Gilts climbed as the U.K. sold bonds at a negative yield for the first time. Yields were steady as the U.S. Treasury resumed sales of 20-year bonds for the first time since 1986. The securities drew a yield of 1.220%, slightly higher than the 1.213% yield that traders were indicating before the sale.
Investors have been whipsawed by conflicting news regarding a possible vaccine for the virus, as many governments around the world ease lockdowns even as the pandemic continues to spread, with Brazil now the world’s hotspot for new infections. The euro’s gains coincided with progress on a 500 billion-euro ($550 billion) fiscal-stimulus plan by the European Union, though critics say the package may be too little, too late to counter the devastating effect on the region’s economies and bolster the outlook for corporate profits.
“We’re driven by the headlines and we should expect to see some volatility when it comes to markets,” said Nela Richardson, an investment strategist at Edward Jones & Co. “The volatility is to be expected.”
Elsewhere, equity benchmarks in Japan and India saw the bulk of gains in a mixed Asian session, with Shanghai and Hong Kong in the red. In Japan, Tokyo Stock Exchange was among stocks which surged amid speculation that it may be a contender to join the Nikkei 225 equity index.
These are some of the main moves in markets:
Stocks
*The S&P 500 Index increased 1.6% to 2,971.61 as of 4:00 p.m. New York time, the highest in more than 10 weeks.
*The Dow Jones Industrial Average climbed 1.4% to 24,575.90.
*The Nasdaq Composite Index jumped 1.8% to 9,375.78, the highest in more than 12 weeks.
*The Stoxx Europe 600 Index gained 1% to 342.82, the highest in almost three weeks.
*The MSCI All-Country World Index advanced 1.3% to 497.67, the highest in more than 10 weeks.
Currencies
*The Bloomberg Dollar Spot Index decreased 0.3% to 1,241.24, the lowest in five weeks.
*The euro increased 0.5% to $1.0981, the strongest in more than two weeks.
*The Japanese yen strengthened 0.2% to 107.55 per dollar.
*The British pound declined 0.2% to $1.223.
Bonds
*The yield on two-year Treasuries advanced less than one basis point to 0.17%.
*The yield on 10-year Treasuries climbed one basis point to 0.69%.
*Germany’s 10-year yield fell less than one basis point to -0.47%.
*Britain’s 10-year yield dipped two basis points to 0.229%.
Commodities
*West Texas Intermediate crude advanced 3% to $33.61 a barrel, reaching the highest in five weeks on its fifth straight advance.
*Gold strengthened 0.1% to $1,749.22 an ounce, the highest in the highest in more than seven years.

Have a great night.

Be magnificent!
As ever,

Carolann

Once the game is over, the King and the pawn go back in the same box. –Italian Proverb.

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