November 23, 2018 Newsletter

Dear Friends,

Tangents: Happy Friday!

Full moon tonight!
1936 – Life magazine premiered.
2005 – Ottawa announces $1.9 billion compensation for survivors of abuse at native residential schools. Go to article »

POINTS OF PROGRESS:
EUROPEAN UNION
The European Parliament has voted to ban a wide range of single-use plastics.  Plastic utensils, straws, drink stirrers and plates are some of the items that will be banned by the new measure.  Spurred by public support for a single-use plastics ban, the EU plans to have the measure take effect I 2021.  All member countries – including Britain, if the Brexit transition period has not ended – will be required to work the ban into national law. -BBC

UNITED ARAB EMIRATES
A new anti-desertification  process is currently being tested in Dubai.  According to the United nations, desertification is a global problem, and about 46,000 square miles of arable land are lost each year.  No3w. a nongovernmental organization is using existing infrastructure to fight it.  Across the world, millions of man-made lakes sustain populations in dry areas.  These lakes must be dredged so that they don’t overflow or lose water storage capacity, but many local governments can’t afford the process.  Afforest4Future uses existing dredging companies to remove lake sediment; in turn, dredged sediment can be pumped out and used as topsoil in areas that have already been desertified. –New York Magazine.

PHOTOS OF THE DAY

Autumn colours reflected in Buttermere Lake in the Lake District, Cumbria, UK. Credit: Owen Humphreys/PA Wire

People light lamps at the Banganga pond as they celebrate Dev Diwali festival in Mumbai, India. Credit: AP Photo/Rajanish Kakade  

Visitors look at an art installation by Japanese artist Tatsuo Miyajima titled ‘Mega Death’ during Minimalism: Space. Light. Object exhibition at the National Gallery Singapore. The exhibition features over 150 works that explore the history and legacy of the ‘Minimalism’ art movement and runs from 16 November 2018 to 14 April 2019. Credit: Suhaimi Abdullah/Getty Images
Market Closes for November 23^rd, 2018

International Markets

Bonds

Currencies

Commodities

Market Commentary:
Canada
By Kristine Owram
     (Bloomberg) — Canadian stocks retreated for a fourth day in five as oil posted its biggest weekly loss since the depths of the last price slump in 2016. The S&P/TSX Composite Index fell 0.5 percent to close at 15,010.78 Friday after earlier losing as much as 1.3 percent.
     The benchmark’s weekly loss was 1 percent. Energy stocks posted the biggest decliners, falling 3 percent as West Texas Intermediate crude prices tumbled 7.7 percent. Futures in London posted their worst week since January 2016. Canadian Natural Resources Ltd. was among the biggest decliners, falling to its lowest since April 2016.
     Materials also weighed on the index, losing 2.3 percent amid weakness in base metal prices. Progress in U.S.-China trade talks is looking less likely ahead of a meeting next week, weighing on the outlook for global growth.
In other moves:
Stocks
* Torex Gold Resources Inc. slid 14 percent, the most in a year, amid the prospect for tougher mining regulations in Mexico
* Canadian Western Bank fell 5.8 percent, the most since 2016. The bank is exposed to the energy patch, which is being hammered by tumbling crude prices
* Cannex Capital Holdings Inc. jumped 12 percent after the cannabis firm secured a $32 million investment from Gotham Green Partners LLC
* Air Canada and WestJet Airlines Ltd. both jumped 3.5 percent. The airlines are poised to benefit from lower fuel prices. WestJet has risen six straight sessions, the longest streak since March 2017.
Commodities
* Western Canada Select crude oil traded at a $35.75 discount to WTI
* Gold fell 0.4 percent to $1,223.20 an ounce
FX/Bonds
* The Canadian dollar weakened 0.4 percent to C$1.3238 per U.S. dollar
* The Canada 10-year government bond yield fell 3 basis points to 2.34 percent
US
By Vildana Hajric
     (Bloomberg) — Stocks fell and the S&P 500 Index tumbled into a correction in shortened Black Friday trading as energy companies were battered with oil sliding below $51 a barrel, its lowest in a year. Crude’s weakness on signs of oversupply also paced a broad retreat in commodities, and the dollar climbed with Treasuries.
     All major equity benchmarks were lower. The S&P 500 Index had its worst Thanksgiving week performance since 1939, and is down 10 percent from its September high, the technical definition of a correction. Energy was by far the worst performing group on Friday, with companies like Devon Energy Corp. and Marathon Oil Corp. losing at least 4 percent. West Texas Intermediate crude slid 6.3 percent to $51.20 and is down 33 percent since hitting a four-year high of $76.41 last month.
     The break in petroleum prices only adds to the list of issues investors will be weighing this weekend — from trade wars to the likelihood of the economic expansion continuing.
     “There’s a lot of uncertainty to still churn through,” Noah Weisberger, chief U.S. strategist at AB Bernstein, said on Bloomberg TV. “I’m a little bit surprised, you know, going back to October that its taken the market as long as it has — it still hasn’t regained its footing.”
     Trading was very quiet, with volume more than 30 percent below average over the past 30 days. Stock markets closed early at 1 p.m. in New York. Bond markets shut at 2 p.m. “It’s a light volume day,” said Chris Zaccarelli chief investment officer at the Independent Advisor Alliance. “I’m not going to read too much into it.”
     In Europe, sluggish mining shares pushed the Stoxx Europe 600 Index lower. The euro reversed earlier gains as data showed Germany’s growth outlook weakened. The pound handed back much of Thursday’s gains after Spain objected to part of the Brexit plan. Italian bonds led an advance in European debt markets.
     Drops in oil, copper and other industrial raw materials set the Bloomberg Commodity Index on track for the biggest weekly decline since July. But falling commodity prices are just one of several indicators that reinforce investor concern about weakening global growth. Political turmoil in Europe, a lingering uncertainty over the Brexit agreement and a trade war that’s engulfed the world’s biggest economies add to nervousness.
     Slowing growth is one of several prospects that may lead the Federal Reserve toward more caution in 2019 should it raise rates next month.
     “The global economy is slowing down but we’re slowing down from a pretty decent level,” Jonathan Mackay, strategist at Schroder Fund Advisors, said on Bloomberg TV. “It’s a little bit of ‘reality bites’ right now. The picture is still fine. It’s just not as good as it was. And that’s feeding into this technical unwind we’re seeing in the oil market as well.”
     Elsewhere, a drop Chinese equities led regional declines in Asia, with the technology sector weak on concern the U.S. is ratcheting up a campaign against Huawei Technologies Co. Emerging market shares and currencies fell. And Bitcoin was on course for a 22 percent tumble this week.
Coming Up
* Presidents Donald Trump and Xi Jinping plan to meet at the G-20 summit in Argentina next week.
* Federal Reserve Vice Chairman Richard Clarida speaks in New York on Tuesday and Chairman Jerome Powell addresses the New York Economic Club on Wednesday. 
* Next Thursday sees the release of the minutes from the Federal Open Market Committee’s November meeting.
* European Central Bank President Mario Draghi will address the European Parliament’s committee for economic and monetary affairs on Monday.
These are the main moves in markets:
Stocks
* The S&P 500 fell 0.7 percent to 2,632.56.
* The Stoxx Europe 600 dipped 0.2 percent.
* The MSCI All-Country World Index declined 0.5 percent.
* The MSCI Emerging Market Index dropped 0.7 percent to the lowest in a week.
Currencies
* The Bloomberg Dollar Spot Index gained 0.3 percent.
* The euro sank 0.6 percent to $1.1334.
* The Japanese yen climbed 0.1 percent to 112.85 per dollar.
* The British pound lost 0.6 percent to $1.2804.
* The MSCI Emerging Markets Currency Index fell 0.2 percent.
Bonds
* The yield on 10-year Treasuries decreased two basis points to 3.039 percent, the lowest since September.
* Germany’s 10-year yield dipped three basis points to 0.34 percent.
* Britain’s 10-year yield retreated five basis points to 1.381 percent.
Commodities
* The Bloomberg Commodity Index declined 1.7 percent to the lowest since July.
* West Texas Intermediate crude sank 6.3 percent to $51.17 a barrel, the lowest in 13 months.
* Gold fell 0.4 percent to $1,223.48 an ounce.
–With assistance from Abhishek Vishnoi, Adam Haigh, Vildana Hajric and Eddie van der Walt.

Have a wonderful weekend.

Be magnificent!

As ever,

Carolann

If you can’t tolerate critics, don’t do anything new or interesting.
                                                           -Jeff Bezos, b. 1964

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