And I will make thee beds of roses 
And a thousand fragrant posies, 
A cap of flowers, and a kirtle 
Embroidered all with leaves of myrtle; 

A gown made of the finest wool 
Which from our pretty lambs we pull; 
Fair lined slippers for the cold, 
With buckles of the purest gold; 

A belt of straw and ivy buds, 
With coral clasps and amber studs: 
And if these pleasures may thee move, 
Come live with me and be my love. 

The shepherds’ swains shall dance and sing 
For thy delight each May morning: 
If these delights thy mind may move, 
Then live with me and be my love.

photos of the day 

May 2, 2011

The White House in Washington is seen through an American flag being held by visitors on the day after Osama bin Laden was killed.

Jacquelyn Martin/AP

A young Jewish man prays in the gas chamber of the Auschwitz Death Camp before the March of the Living in Oswiecim, southern Poland. Thousands of people from around the world take part in the annual March of the Living paying tribute to the victims of the Holocaust at the former Nazi Death Camp Auschwitz-Birkenau.

Bela Szandelszky/AP

Market Commentary:

 Canada

By Matt Walcoff

     May 2 (Bloomberg) — Most Canadian stocks rose, led by banks and insurers, after U.S. forces killed Osama bin Laden and a gauge of U.S. manufacturing dropped less than most economists had forecast.

     Manulife Financial Corp., North America’s fourth-largest insurer, advanced 3 percent after U.S. President Barack Obama said Osama bin Laden is dead. Silver Wheaton Corp., Canada’s fourth-biggest precious-metals company, tumbled 6.7 percent after CME Group Inc. raised the amount of cash that traders must deposit for speculative positions in silver. Valeant Pharmaceuticals International Inc., Canada’s largest drugmaker, slumped 5.5 percent after Teva Pharmaceutical Industries Ltd. outbid it for Cephalon Inc.

     The Standard & Poor’s/TSX Composite Index slipped 10.28 points, or 0.1 percent, to 13,934.51 as the plunge in precious metals outweighed gains in other stocks. Among S&P/TSX companies, 126 advanced, 114 declined and eight were unchanged.

     “The whole thing with Osama bin Laden is definitely a positive,” said Sadiq Adatia, chief investment officer at Russell Investments Canada, which manages C$12 billion ($12.6 billion). “People will be able to put this behind them now and focus on the economy.”

     The S&P/TSX lost 1 percent with dividends included last month, its first negative total return since June.

     Energy producers and banks led the retreat last month as data and forecasts indicated a slowing economic recovery, especially in the U.S. The Canadian stock benchmark’s price relative to earnings climbed to an eight-year high in April versus the price-earnings ratio of the S&P 500.                      

     The Institute for Supply Management’s measure of U.S. manufacturing fell to 60.4 last month from 61.2 in March, the Temple, Arizona-based organization said. Economists had forecast a reading of 59.5, according to the median of 78 estimates in a Bloomberg survey.

     The S&P/TSX Financials Index gained the most in seven days.

     Manulife increased 3 percent to C$17.50. Bank of Nova Scotia, Canada’s third-largest lender by assets, climbed 1.2 percent to C$58.40. National Bank of Canada, the No. 6 bank in the country, rose 1.7 percent to C$79.65.

     TransCanada Corp., the owner of Canada’s largest pipeline system, gained 2.2 percent, the most in almost a year, to C$41.62 as at least six analysts boosted their share-price estimates. On April 29, the Calgary-based company reported first-quarter profit and revenue that topped the average analyst forecast.

     Silver fell more than 10 percent in after-market trading after the CME, the parent of the Comex exchange, raised initial margins by 13 percent.

     Silver Wheaton Corp., Canada’s fourth-largest precious- metals producer by market value, decreased 6.7 percent to C$35.93. Silver Standard Resources Inc., which mines in Latin America, tumbled 9.6 percent, the most in 26 months, to C$29.76.

Silvercorp Metals Inc., which operates in China, sank 9.4 percent, the most since July 2009, to C$11.67.

     Gold futures declined in after-market trading as the U.S. dollar advanced against a basket of world currencies for the first time in 10 days. Goldcorp Inc., the world’s second-largest gold producer, lost 5.2 percent, the most since July, to C$50.12. Barrick Gold Corp., the world’s biggest producer of the metal, decreased 2.2 percent to C$47.24.

     Centerra Gold Inc., which mines in Kyrgyzstan and Mongolia, increased 6.3 percent to C$18.70 after its first-quarter profit beat the average of nine analyst estimates by 74 percent, excluding certain items. The company also raised its annual dividend by 67 percent to 10 Canadian cents a share and said it will pay a special dividend of 30 Canadian cents a share.

     Valeant sank 5.5 percent, the most since June 2009, to C$47.18 after Cephalon agreed to be bought by Petah Tikvah, Israel-based Teva for $81.50 a share. Valeant had made an unsolicited offer of $73 a share in March for Frazer, Pennsylvania-based Cephalon.

     Trucking company TransForce Inc. surged 6 percent to C$14.94, the highest close since May 2007. David F. Newman, an analyst at Cormark Securities Inc., raised his rating on the shares to “buy” from “market perform” a business day after the Saint-Laurent, Quebec-based company said it will buy DHL Express Canada’s domestic business.

     In a note to clients, Newman said the deal will provide “pricing improvement, scale efficiencies and revenue and cost synergies.”

     Extendicare Real Estate Investment Trust, which owns 265 senior-care centers in the U.S. and Canada, lost 4.7 percent to $11.33 to extend its two-day retreat to 14 percent. The shares tumbled after the U.S. Health & Human Services Department proposed a rate cut for skilled-nursing facilities on April 29.

US

By Jeff Sutherland and Rita Nazareth

     May 2 (Bloomberg) — U.S. stocks retreated, pulling the Standard & Poor’s 500 Index down from the highest level since June 2008, as a slump in commodity producers overshadowed optimism spurred by the death of Osama bin Laden.

     Energy shares had the biggest decline in the S&P 500 within 10 industries as crude oil prices fell. Applied Materials Inc. slumped 3.4 percent after JPMorgan Chase & Co. cut its rating for the world’s largest producer of chip-making equipment.

Cephalon Inc. climbed 4 percent after Teva Pharmaceutical Industries Ltd. agreed to buy the company for $6.8 billion.

International Coal Group Inc. soared 31 percent after Arch Coal Inc. agreed to purchase it for $3.4 billion.

     The S&P 500 slipped 0.2 percent to 1,361.22 at 4 p.m. in New York, erasing an earlier 0.5 percent advance. The Dow Jones Industrial Average lost 3.18 points, or less than 0.1 percent, to 12,807.36 after climbing as much as 65 points.

     “Bin Laden’s death eliminates a specific terrorist threat and, as such, serves to lower overall security risks over time,” said Mohamed El-Erian, chief executive officer at Newport Beach, California-based Pacific Investment Management Co., the world’s biggest manager of bond funds. “In the immediate, there could also be isolated disturbances in some parts of the world. While all this could impact the economy and markets, the big question is whether the American political reaction, centered on unity and common purpose, can act as a catalyst for meaningful progress on key economic and financial policy challenges.”                      

     The S&P 500 rallied 8.2 percent in 2011 as higher-than- estimated profit and economic reports bolstered investors’ confidence. Earnings-per-share beat estimates at more than three-quarters of the 302 companies in the S&P 500 that reported results since April 11, according to data compiled by Bloomberg.

     The gains pushed the S&P 500’s valuation last week to about 15.5 times the reported operating earnings of its companies, near the 2011 high of 15.8 reached in February. The S&P 500 Total Return Index, which measures the gauge’s performance including reinvested dividends, rallied for an eighth straight month in April to match its longest streak of gains since 1995.

     “There’s a question of momentum,” said Alan Gayle, senior investment strategist at RidgeWorth Capital Management in Richmond, Virginia, which oversees $48 billion. “People are asking — how high can this market go? I personally don’t think the market is overvalued. We’ll maybe see some consolidation at these levels.”                   

     Stocks started today’s session higher after bin Laden, 54, was killed by the U.S. military in a mansion outside Islamabad, President Barack Obama said. Bin Laden used a family inheritance to build the global terrorist network that killed almost 3,000 people in the Sept. 11, 2001, attacks targeting New York and Washington. The Saudi-born bin Laden helped found al-Qaeda in 1988 after fighting Soviet troops in Afghanistan.

     He appeared in videotapes threatening strikes against the West, including a message praising the Sept. 11 attacks as “divine blows” against America. The attacks with hijacked airliners prompted a national security initiative for commercial aviation that altered air travel. Al-Qaeda has dispersed in the past decade. Still, bin Laden’s demise may hamper the coordination of terrorist organizations and reduce recruitment by his network and other groups.

     The S&P 500 sank 12 percent in the first five trading sessions following the destruction of the World Trade Center.

The New York Stock Exchange didn’t reopen until Sept. 17, 2001.

     “You have a very complex situation” in the Middle East, said Russ Koesterich, the San Francisco-based head of investment strategy for scientific active equities at BlackRock Inc., which oversees $3.65 trillion as the world’s largest asset manager.

“It’s also not clear that bin Laden’s death is going to change the ongoing events” in that region. “We got a psychological lift, but it doesn’t change anything.”

     A report showed that U.S. manufacturing cooled in April to a pace consistent with steady growth in the industry that’s leading the expansion. The Institute for Supply Management’s manufacturing index fell to 60.4 last month from 61.2 in March.

Figures greater than 50 signal expansion, and the April reading exceeded the 59.5 median forecast in a Bloomberg News survey.

     In China, a manufacturing index fell after the government raised interest rates and lenders’ reserve requirements and allowed gains in the yuan to pick up pace. The Purchasing Managers’ Index was at 52.9 in April from 53.4 in March, China’s logistics federation and the statistics bureau said. That was below a median forecast of 53.9 in a Bloomberg News survey of 20 economists.                    

 Energy shares slumped 1.3 percent as a group, the biggest decline in the S&P 500 among 10 industries. Exxon Mobil Corp. lost 1.2 percent to $86.97. Freeport-McMoRan Copper & Gold Inc. decreased 1.2 percent to $54.34 to pace losses in mining companies as gold retreated and silver plunged 5.2 percent, the most since January, as exchange owner CME Group Inc. raised the cash deposit required for trading.

     Applied Materials fell 3.4 percent to $15.15 after the shares were downgraded to “neutral” from “overweight” at JPMorgan.

     A gauge of health-care companies had the biggest gain in the S&P 500 within 10 industries, rising 1 percent as a group.

     Cephalon climbed 4 percent to $80.11. Israel-based Teva will pay $81.50 a share in cash for the company, or a total enterprise value of about $6.8 billion. Buying Cephalon would help Teva offset the revenue it may lose as its top-selling product, the multiple sclerosis drug Copaxone, faces competition from generic versions and new branded products.

     Forest Laboratories Inc. rallied 4.8 percent, the biggest gain in the S&P 500, to $34.74. Seeking Alpha contributor Bret Jensen said the New York-based drugmaker and Gilead Sciences Inc. may be likely takeover targets. Gilead added 4.7 percent to $40.67.

     Frank Murdolo, vice president of investor relations for Forest, and Amy Flood, a spokeswoman for Gilead, declined to comment.

     International Coal Group soared 31 percent to $14.43. Arch Coal agreed to buy the coal miner for $14.60 a share in an all- cash transaction to become the second-largest U.S. metallurgical coal producer. Arch expects pro forma metallurgical sales to reach 11 million tons in 2011 and 14 million tons over the next three years from the combined operations.

     About $823 billion in global deals have been announced so far this year, a 25 percent increase from the $657.4 billion in the same period in 2010, according to data compiled by Bloomberg.

Have a wonderful evening everyone.

Be magnificent!

To grow is to go beyond what you are today.

Stand up as yourself.  Do not imitate.

Do not pretend to have achieved your goal, and do not try to cut corners.

Just try to grow.

-Swami Prajnanpad,1891-1974 

As ever,

Carolann

Follow your honest convictions,

and stay strong.

      -William Thackeray, 1811-1863

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

Senior Vice-President &

Senior Investment Advisor