May 4, 2021 Newsletter

Dear Friends,

Tangents:

On May 4, 1970, Ohio National Guardsmen opened fire on anti-war protesters at Kent State University, killing four students and wounding nine others. Go to article »

Hubble telescope spies rare giant star battling against self-destruction.  Aren’t we all rare giant stars, battling against self-destruction? 

Belgian farmer accidentally moves the French border. (h/t Mike Smedley)

PHOTOS OF THE DAY

A group of majestic horses charge through wetlands. The grey Camargues horses are one of the oldest breeds in the world and, despite their small stature, are renowned for being powerful. They stand at between four and five feet tall and are closely associated with their indigenous land of Camargue, on the southern coast of France.
CREDIT: MONIKA SEYFERR/SOLENT NEWS & PHOTO AGENCY

Stunning bluebells flowers adorn the woodland floor near Wimborne, Dorset while nearby fields of rapeseed turns the landscape in to a sea of yellow.
CREDIT: VAGNER VIDAL/HYDE NEWS & PIRTURE

A red kite ruffles itself up while it gives a photographer a menacing glare. The angry looking feathered fowl was captured on camera by Programme Manager Gavin Turner, 41, from Sherfield-on-Loddon.  
CREDIT: GAIVN TURNER/SOLENT NEWS & PHOTO AGENCY

Market Closes for May 4^th, 2021

International Markets

Bonds

Currencies

Commodities

Market Commentary:
     On this day in 1979, the first modern leveraged buyout using high-yield junk bonds—a $381 million deal to take Houdaille Industries private—was completed by KKR. Over the next six years, Houdaille produced a 33.9% average annual return for KKR’s institutional investors.
Canada
By Michael Bellusci
(Bloomberg) — Canadian equities fell Tuesday after mixed earnings reports, while U.S. Treasury Secretary Janet Yellen ruffled markets with a comment that interest rates will likely rise. The S&P/TSX Composite Index fell 0.1%. Ballard Power Systems Inc. tumbled 20% after weak earnings, while Bausch Health Cos Inc. lost 11%. The Bloomberg Commodity Spot Index, which tracks prices for 23 raw materials, rose 0.8% Tuesday to its highest since 2011. The gauge has climbed more than 70% since reaching a four-year low in March of last year.
Commodities
* Western Canadian Select crude oil traded at about a $13.10 discount to West Texas Intermediate
* Spot gold fell 0.8% to $1,779 an ounce
FX/Bonds
* The Canadian dollar fell 0.2% to C$1.2307 per U.S. dollar
* The 10-year Canada government bond yield edged higher to 1.526%
By Bloomberg Automation:
     (Bloomberg) — The S&P/TSX Composite fell 0.1 percent at 19,188.03 in Toronto. The move follows the previous session’s increase of 0.5 percent. Bausch Health Cos. contributed the most to the index decline, decreasing 10.7 percent. Ballard Power Systems Inc. had the largest drop, falling 19.5 percent. Today, 161 of 229 shares fell, while 66 rose; 9 of 11 sectors were lower, led by financials stocks.
Insights
* The index advanced 30 percent in the past 52 weeks. The MSCI AC Americas Index gained 49 percent in the same period
* The S&P/TSX Composite is 1.3 percent below its 52-week high on April 29, 2021 and 35.2 percent above its low on May 14, 2020
* The S&P/TSX Composite is little changed in the past 5 days and rose 1 percent in the past 30 days
* S&P/TSX Composite is trading at a price-to-earnings ratio of 27.4 on a trailing basis and 17.1 times estimated earnings of its members for the coming year
* The index’s dividend yield is 2.7 percent on a trailing 12-month basis
* S&P/TSX Composite’s members have a total market capitalization of C$3.01t
* 30-day price volatility fell to 8.59 percent compared with 8.96 percent in the previous session and the average of 9.33 percent over the past month
================================================================
| Index Points | |
Sector Name | Move | % Change | Adv/Dec
================================================================
* Financials | -10.7219| -0.2| 8/19
* Health Care | -10.6800| -4.3| 6/4
* Consumer Discretionary | -10.4133| -1.3| 1/12
* Utilities | -4.5333| -0.5| 5/11
* Consumer Staples | -3.8886| -0.6| 5/8
* Real Estate | -3.4681| -0.6| 3/22
* Industrials | -2.0192| -0.1| 11/19
* Materials | -1.3762| -0.1| 11/41
* Energy | -0.2141| 0.0| 10/13
* Communication Services | 2.7480| 0.3| 4/4
* Information Technology | 19.4351| 1.1| 2/8

US
By Rita Nazareth and Claire Ballentine
(Bloomberg) — Volatility gripped financial markets as a rout in some of the largest tech companies dragged down stocks. The dollar rose. Megacaps such Apple Inc., Tesla Inc. and Amazon.com Inc. sent the Nasdaq 100 slumping, while the S&P 500 pared losses amid gains in commodity, financial and industrial shares. Treasury Secretary Janet Yellen rattled markets with a comment economists regarded as self-evident — that rates will likely rise as government spending ramps up and the economy responds with faster growth. Later in the day, Yellen said she wasn’t predicting or recommending rate hikes. The debate on whether government spending could boost inflation comes at a time when stock valuations are hovering near the highest levels in two decades.
Hedge funds have been bailing from equities at a pace not seen since the financial crisis, while shares have struggled to gain traction despite blowout corporate earnings. “We’ve had this spectacular run-up, and I think we’ve seen momentum just run out of steam,” said Fiona Cincotta, senior financial markets analyst at City Index. “Despite earnings being encouraging, they haven’t managed to push those indices higher. Moving out of growth and into cyclicals is the place we’re going to have more movement.” Earlier Tuesday, a sharp drop in equity futures left traders scrambling for an explanation. Some of them speculated on military tensions between China and Taiwan, Singapore’s tougher coronavirus restrictions and Ferrari NV’s decision to postpone financial targets. Investors also monitored the latest economic readings, with the U.S. trade deficit widening to a new record in March. Meanwhile, a senior White House economic aide demurred on the question of whether President Joe Biden will nominate Fed Chair Jerome Powell for a second four-year term, saying the decision on selecting the next central bank chief will come after a thorough “process.”
Here are some key events to watch this week:
* U.S. ADP employment change is due Wednesday
* Chicago Fed President Charles Evans gives a virtual speech at an event hosted by Bard College on Wednesday. Cleveland Fed President Loretta Mester gives a virtual speech to the Boston Economic Club
* Bank of England rate decision Thursday
* The April U.S. employment report is released on Friday

These are some of the main moves in markets:
Stocks
* The S&P 500 fell 0.7% as of 4 p.m. New York time
* The Nasdaq 100 fell 1.85%
* The Dow Jones Industrial Average was little changed
* The MSCI World index fell 0.8%
Currencies
* The Bloomberg Dollar Spot Index rose 0.3%
* The euro fell 0.4% to $1.2017
* The British pound fell 0.2% to $1.3887
* The Japanese yen fell 0.2% to 109.29 per dollar
Bonds
* The yield on 10-year Treasuries declined one basis point to 1.58%
* Germany’s 10-year yield declined three basis points to -0.24%
* Britain’s 10-year yield declined five basis points to 0.79%
Commodities
* West Texas Intermediate crude rose 2.3% to $66 a barrel
* Gold futures fell 0.7% to $1,779 an ounce
–With assistance from Andreea Papuc, Yakob Peterseil, Vildana Hajric, Kamaron Leach, Sophie Caronello and Nancy Moran.

Have a great night.

Be magnificent!
As ever,

Carolann

Success is to be measured not so much by the position that one has reached in life as by the obstacles which he has overcome. –Booker T. Washington, 1856-1915.

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