May 30, 2019 Newsletter

Dear Friends,

Tangents:
1832 – Rideau Canal opens to traffic; 47 locks linking Ottawa River with Lake Ontario. Go to article »
1672 ~ Peter the Great, Russian tsar, born.
1783 ~ First US newspaper published.

The Poem:

MISSING THE MOON

We’re missing the moon this month,
cloud-swallowed most nights
although an occasional celestial yawn
allows a glimpse of the silver queen.

She’s not distressed,
just waiting for June’s ransom
to give back to her
the starry dominion storms took.
Then she’ll sail unperturbed
from horizon to horizon,
slowing over Iowa
to gather fireflies in her gauzy net.

                     -Christine Vovakes

PHOTOS OF THE DAY

A runner competes in the world’s highest marathon in the foothills of Mount Everest in the Solukhumbu district of Nepal. More than 224 including 160 foreigners from 30 countries and local runners tool part in the world’s highest marathon to mark the anniversary of the first summit of the peak by Tenzing Norgay and Edmund Hillary on May 29, 1953
CREDIT: TENZING – HILLARY EVEREST MARATHON/AFP

People watch a hologram of “L’uomo vitruviano” (The Vitruvian man) during the Leonardo da Vinci multimedia installation “ Leonardo Da Vinci 3 D” at the Fabbrica del Vapore ( Steam Factory) in Milan
CREDIT: MIGUEL MEDINA/ AFP/ GETTY IMGES

The Sydney Opera House is illuminated by an artwork projection entitled Austral Flora Ballet by artist Thomas Huang, Sydney, Australia.
CREDIT: MARK METCALFE/ GETTY IMAGES

Lighting strikes on either side of One World Trade Center in lower Manhattan in New York City
CREDIT: GARY HERSHORN/GETTY IMAGES
Market Closes for May 30^th , 2019

International Markets

Bonds

Currencies

Commodities

Market Commentary:

Canada
By Michael Bellusci
     (Bloomberg) — Canadian stocks dropped Thursday despite climbing in early trading, while U.S. stocks rebounded from a slump that took them to a 12-week low.
     The S&P/TSX Composite Index dropped 0.3 percent to 16,089. Health care and energy shares led the decliners, while information technology and materials rose. Bank of Canada officials continue to characterize the country’s economic performance as “solid,” despite a recent soft patch they believe is only temporary. Separately, U.S. Vice President Mike Pence promised the new trade pact between the U.S., Canada and Mexico will pass this year.
In other moves:
Stocks
* Maxar Technologies Inc. fell 6% after a Moody’s downgrade
* Peyto Exploration & Development Corp. lost 4.7% 
* Birchcliff Energy Ltd. dropped 4.4% 
* Green Organic Dutchman Holdings Ltd. fell 4.4% 
Ratings
* BMO CN: Bank of Montreal Cut to Sector Perform at Scotiabank; PT C$109
* ELD CN: Eldorado Gold Downgraded to Underweight at JPMorgan 
* K CN: Kinross Gold Downgraded to Underweight at JPMorgan
* NGD CN: New Gold Downgraded to Underweight at JPMorgan
* TOU CN: Tourmaline Oil Upgraded at BMO on Cash Flow Generation Plan
Commodities
* Western Canada Select crude oil traded at a $17 discount to WTI
* Gold rose 0.5% to $1,293.20 an ounce
FX/Bonds
* The Canadian dollar strengthened 0.1% to C$1.3507 per U.S. dollar
* The Canada 10-year government bond yield fell to 1.71%
US
By Jeremy Herron and Vildana Hajric
     (Bloomberg) — U.S. stocks rebounded from a slump that took them to a 12-week low, while Treasuries resumed a rally that pinned yields at 20-month lows amid concern that the trade spat with China could derail global growth. Oil tumbled.
     The S&P 500 pared its May decline to 5%, with the 200-day moving average providing support during an afternoon swoon. Technology shares paced the gain, while banks contributed most to losses. A fresh batch of economic data suggested the expansion was on firm footing before the Trump administration escalated the trade war earlier in May, but an inversion in part of the yield curve has investors on edge about the threat of a recession.
     The 10-year Treasury yield continued its march lower, hitting 2.22% for the second straight day. The dollar traded at a five-month high. Crude slumped 3% to below $57 a barrel. Gold rose. Turbulence in stocks and the march lower in bond yields this week suggest investors are increasingly coming to terms with an uncertain outlook for markets. The possibility that Beijing may cut exports of rare-earth minerals, along with signs that U.S.-EU talks aren’t going anywhere meaningful, are adding to trade tensions. Meanwhile, bond markets are flashing a warning, with the yield gap between three-month and 10-year Treasuries, often watched as an early signal of pending recession, sliding to a 2007 low Wednesday.
     “What’s going on in Treasury markets is ultimately a repricing of growth expectations,” John Bilton, head of global multi-asset strategy at JPMorgan Asset Management, said on Bloomberg TV. “We don’t see a recession coming in the next 12 months even allowing for the yield-curve inversion we’ve seen, typically that’s a signal that has a long lead time.”
     The Stoxx Europe 600 climbed, led by media firms, a day after posting its biggest drop in nearly three weeks. Asian markets were mixed, with Shanghai edging lower as China notched a fresh escalation of the tariff war by putting U.S. soybean purchases on hold.
     Elsewhere, oil traded around $59 a barrel after the release of an industry report showing a much bigger-than-expected drop in U.S. crude stockpiles. 
Here are some key events coming up:
* China provides a first peek at its May economic performance on Friday, with economists anticipating the official manufacturing PMI will tick down to 49.9 amid the worsening trade war with the U.S.
* On Friday, data is due on the Fed’s preferred measure of price pressures; the gauge, which excludes food an energy, is forecast to be steady at an annual 1.6%.
And these are the main moves in markets:
Stocks
* The S&P 500 rose 0.2% at 4 p.m. in New York time.
* The Nasdaq 100 Index lost 0.4% and the Russell 2000 Index fell 0.3%.
* The Stoxx Europe 600 Index rose 0.4%.
* The Shanghai Composite Index declined 0.3%, the first retreat in a week.
* The MSCI Emerging Market Index climbed 0.9%, the highest in more than a week on the biggest increase in eight weeks.
Currencies
* The Bloomberg Dollar Spot Index was flat after touching the highest in more than five months.
* The euro climbed 0.1% to $1.1140.
* The Japanese yen slipped 0.1% to 109.65 per dollar. 
* The onshore yuan increased 0.1% to 6.906 per dollar.
Bonds
* The yield on 10-year Treasuries decreased four basis points to 2.22%, the lowest in 20 months.
* The yield on two-year Treasuries dipped four basis points to 2.07%, the lowest in more than 15 months.
* Germany’s 10-year yield gained less than one basis point to -0.175%.
Commodities
* West Texas Intermediate crude fell 2% to $57.57 a barrel.
* Gold futures rose 0.5% to $1,292.70 an ounce.
–With assistance from Andreea Papuc, David Wilson and Yakob Peterseil.

Have a great night.

Be magnificent!
As ever,

Carolann

Never do things others can do and will do, if there are things others cannot do or will not do.

                                                                                           -Amelia Earhart, 1897-1939

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