May 30, 2014 Newsletter

Dear Friends,

Tangents:

Some of us heard the singing of angels, harmonies in a heavenly choir,
or at least the music of the spheres.
We had come so far from where we started, and weren’t nearly approaching
where we had to be, but we were on the road to becoming better.
I thought if I wrote a book, I would have to examine the quality in the
human spirit that continues to rise despite the slings and arrows of outrageous fortune.
Rise out of physical pain and the psychological cruelties.
Rise from being victims of rape and abuse and abandonment to the
determination to be no victim of any kind.
Rise and be prepared to move on and ever on.
I remembered a children’s poem from my mute days in Arkansas that seemed
to say however low you perceive me now, I am headed for higher ground.
I wrote the first line in the book, which would become I Know Why the Caged Bird Sings.
“What you looking at me for.  I didn’t come to stay.”

-Maya Angelou, April 4, 1928- May 28, 2014
-from A Song Flung Up to Heaven.

Caught the opening night of Lionel Ritchie’s new tour in Vancouver last night and it was fantastic!  It’s a 41-city tour, so check out the locations on line and try to get to one of the concerts.  He is an amazing artist.

Photos of the day

Spiritual dancers perform during a memorial service for American author and poet Maya Angelou at Mount Zion Baptist Church in Winston-Salem, North Carolina May 29. Angelou, whose groundbreaking memoir ‘I Know Why the Caged Bird Sings’ earned her international acclaim with its unflinching account of rape and racism in the segregated South, died on Wednesday at age 86. Chris Keane/Reuters

Kentucky Derby and Preakness Stakes 2014 winner California Chrome stands while being bathed at Belmont Park in Elmont, New York. California Chrome needs to win the Belmont Stakes in New York on June 7 to become just the 12th horse and the first in 36 years to complete US horse racing’s Triple Crown. Shannon Stapleton/Reuters

Market Closes for May 30^th, 2014

International Markets

Bonds

Currencies

Commodities

Market Commentary:

Canada
By Gerrit De Vynck

May 30 (Bloomberg) — Canadian stocks rose, trimming the benchmark index’s first monthly decline since June, as Valeant Pharmaceuticals International Inc. rallied after boosting its bid for Allergan Inc.

Valeant reversed earlier declines to jump 1.7 percent after increasing the cash portion of its offer for the maker of Botox. Cott Corp. rose 3.5 percent after the beverage company’s U.K. unit bought Aimia Foods Ltd. Midway Gold Corp. fell 9.1 percent after saying it would sell $25 million in new shares.

The Standard & Poor’s/TSX Composite Index gained 15.21 points, or 0.1 percent, to 14,604.16 at 4 p.m. in Toronto, trimming its decline this week to 0.7 percent. The equities benchmark fell 0.4 percent in May, ending the longest streak of gains since 1983.

“Perhaps the rally’s a little bit expended here so its time to move some capital,” said Brian Huen, managing partner at Red Sky Capital Management Ltd in Toronto. “If you look at the sentiment as well as the action in the market, there’s certainly an air of cautiousness.” Huen said. He helps manage about C$350 million ($320 million).

Equities were lower until the Valeant bid, as a report showed Canada’s gross domestic product grew at a 1.2 percent annualized rate in the first quarter, compared with 2.7 percent in the previous three months. Economists surveyed by Bloomberg forecast growth of 1.8 percent.

Severe weather that struck North America this winter added another hurdle for exporters and businesses that the Bank of Canada said will need to take over as drivers of growth in order to eliminate spare economic capacity. The central bank has held its benchmark rate at 1 percent since 2010 as Canada has struggled to emerge from the global recession with much speed.

Five of the 10 main groups in the S&P/TSX rose today, with health-care shares jumping 1.4 percent to pace gains.

Valeant rose 1.7 percent to C$142.34 after raising its unsolicited offer to $72 cash and 0.83 of a Valeant share for each Allergan share. The previous offer was for $58.30 in cash and the same amount of stock.

Cott gained 3.5 percent to C$7.64. The maker of Stars & Stripes Cola said the Aimia purchase will be funded with cash on hand and an existing lending facility.

Midway Gold fell 9.1 percent to 90 Canadian cents after saying it would sell 30 million shares for 83 cents each.

Kingsway Financial Services Inc. gained 2.5 percent to C$7.02 after it said it had regained full compliance with the New York Stock Exchange’s listing standards.

Canadian Imperial Bank of Commerce lost 2.1 percent to C$95.66 after Macquarie Capital Markets cut its rating on the bank’s stock to the equivalent of a sell from the equivalent of a hold.

Element Financial Corp. rose 1.6 percent to C$13.65 after Reuters reported it was close to buying PHH Corp.’s vehicle fleet leasing unit for $1.35 billion.

US
By Lu Wang

May 30 (Bloomberg) — U.S. stocks rose, with benchmark indexes climbing to records, as utility and consumer-staple shares rallied and investors weighed data showing an uneven recovery in the American economy.

Wal-Mart Stores Inc. and Lorillard Inc. climbed at least 1 percent, pacing gains among companies whose earnings are less tied to economic swings. U.S. Steel Corp. dropped 4.6 percent to lead losses among commodities producers. Lions Gate Entertainment Corp. dropped 12 percent after quarterly results missed estimates.

The Standard and Poor’s 500 Index added 0.2 percent to 1,923.57 at 4 p.m. in New York, bringing its gain in the holiday-shortened week to 1.2 percent. The Dow Jones Industrial Average rose 18.43 points, or 0.1 percent, to 16,717.17, surpassing its previous record from May 13.

“The outlook for the market for the rest of the year remains constructive,” Sam Wardwell, an investment strategist at Pioneer Investments in Boston, said in a phone interview. His firm manages about $249 billion globally. “It’s not so much we don’t have a belief where the market is going, we just don’t know what route it’s going to take to get there.”

Small-cap and technology companies produced losses today, halting a recovery from a selloff that began in early March. The Russell 2000 Index slipped 0.5 percent, trimming its weekly gain to 0.7 percent. The Nasdaq Composite Index lost 0.1 percent, paring its gain this week to 1.4 percent.

The Chicago Board Options Exchange Volatility Index, a gauge of options prices known as VIX, slipped 1.5 percent to 11.40 today. The measure closed for a fifth straight day below 12, the longest stretch since February 2007, data compiled by Bloomberg show.

“The market is almost trading directionally sideways,” Kevin Mahn, president and chief investment officer of Hennion & Walsh Asset Management in Parsippany, New Jersey, said in a phone interview. His firm oversees more than $600 million. “There is no volatility and investors are waiting for the next signal whether they put more in or take more out.”

Eight of 10 main industries in the S&P 500 advanced today. Consumer-staples and utility stocks rose the most, adding more than 0.7 percent. Wal-Mart, a discount retailer, increased 1 percent to $76.77. Lorillard, a cigarette maker, rallied 3.2 percent to $62.17.

Commodity shares were the only groups to decline, as oil and copper prices fell. U.S. Steel slipped 4.6 percent to $23.04 for the biggest retreat in the S&P 500.

About 6 billion shares changed hands on U.S. exchanges, the busiest trading in two weeks.

The S&P 500 has rebounded 5.9 percent since the selloff in small-cap and Internet shares spread to the broader market and dragged the gauge to a two-month low in April. It advanced 2.1 percent in May for a fourth consecutive monthly increase, and is up 4.1 percent this year.

The gauge closed at a record yesterday, shrugging off a report showing the U.S. economy contracted for the first time in three years from January through March.

Data showed today that consumer spending unexpectedly fell in April after the biggest surge in almost five years as incomes slowed. Consumer confidence in the world’s largest economy fell more than forecast in May, a sign consumer spending may be slow to pick up in the second quarter, according to the Thomson Reuters/University of Michigan final index of sentiment.

Business activity in the Chicago area expanded in May for a thirteenth straight month. The Institute for Supply Management- Chicago Inc.’s business barometer rose to 65.5 in May from 63 a month earlier, according to a report today. A reading above than 50 signals expansion.

Federal Reserve policy makers said at their April meeting that the economy has strengthened after adverse weather took its toll. Central-bank stimulus has helped propel the S&P 500 higher by 184 percent from its bear-market low in March 2009. The gauge now trades at 16.3 times the projected earnings of its members, up from a multiple of 14.8 times four months ago.

Lions Gate, the studio behind ‘‘The Hunger Games” movies, slipped 12 percent to $26.13. Revenue fell 8.1 percent to $721.9 million for the quarter through March 31, the company said.

Analysts had predicted $823.7 million on average. Adjusted earnings per share were 42 cents, also missing the 43-cent average estimate.

Express Inc. lost 7.5 percent to $12.61. The retailer predicted earnings of 74 cents to 90 cents a share this year, down from a previous forecast of as much as $1.23. First-quarter profit fell to 6 cents a share, missing estimates.

Infoblox Inc. sank 37 percent to $12.96. Chief Executive Officer Robert Thomas will leave after almost a decade at the network and data-services provider, according to a statement. Profit for the 12 months ending July 31 will be as much as 32 cents per share, down from a previous forecast for as much as 34 cents. Sales will probably not exceed $246 million, less than the $252.6 million average analyst estimate.

Have a wonderful weekend everyone.

Be magnificent!

He whom I have searched for has come to meet me,

and he who calls me Other has become me!

Kabir, 1440-1518

As ever,

Carolann

Success is getting what you want.  Happiness is liking what you get.

-H. Jackson Brown, Jr., 1940-

Carolann Steinhoff, B.Sc., CFP®, CIM, FCSI

Senior Vice-President &

Senior Investment Advisor

Queensbury Securities Inc.,

St. Andrew’s Square,

Suite 340A, 730 View St.,

Victoria, B.C. V8W 3Y7