November 6, 2023, Newsletter

Dear Friends,

Tangents: Happy Monday.
November 6, 1861: James Naismith, the inventor of basketball, was born in Ontario, Canada.  Go to article >>.
November 6,1989: The Ferlin Wall, separating East and West Germany, is opened after nearly three decades of division.

Adolphe Sax, saxophone inventor, b. 1814.
Sally Field, b.1946.

This is the most ‘inconvenient convenience store’
Take a look at this ironic convenience store hanging on a steep cliff in the Chinese province of Hunan.

National Geographic announces 2024 ‘cool list’
Looking to add to your travel bucket list? These 30 places and experiences are the epitome of “cool,” according to National Geographic Traveller.

Taylor Swift’s whirlwind year continues with her 13th No. 1 album
The pop star’s “1989 (Taylor’s Version),” the 2014 hit album she re-recorded and released last month, hit No. 1 on the Billboard 200 album chart in the first week of its release.

Here’s who won the New York City Marathon on Sunday
Ethiopia’s Tamirat Tola set a course record while Kenya’s Hellen Obiri won the women’s race. (Everyone else who ran, you’re still a winner in our eyes!)

Why does time slow down in near-death experiences?
Time can seem to slow down in near-death situations, and speed up as we age. Exactly how does our brain process time? Read More.

PHOTOS OF THE DAY

Northumberland, UK
The aurora borealis, also known as the northern lights, appears over Bamburgh lighthouse on the north-east coast of England.  Photograph: Owen Humphreys/PA.

Siberian Omsk region, Russia
A person stands on a car while looking at auroras, caused by a coronal mass ejection on the sun, that illuminate the skies.  Photograph: Alexey Malgavko/Reuters.

​​​​​​​Puteax, France
French skyscraper climber Alain Robert, nicknamed Spiderman, climbs the Tour TotalEnergies Coupole skyscraper in Puteaux, in the financial and business district of La Defense, to call for peace in the Middle East.  Photograph: Abdul Saboor/Reuters.
Market Closes for November 6^th, 2023

International Markets

Bonds

Currencies

Commodities

Market Commentary:
📈 On this day in 1851, Charles Henry Dow was born on his family’s farm in Sterling, Connecticut. After toiling as a reporter in Massachusetts and Rhode Island, he founded Dow, Jones & Co. in 1882, and devised the Dow Jones Industrial Average in 1896.
Canada
By Bloomberg Automation
(Bloomberg) — The S&P/TSX Composite fell 0.4% at 19,743.94 in Toronto.
The move was the biggest since falling 0.7% on Oct. 27 and follows the previous session’s increase of 1%.
Nutrien Ltd. contributed the most to the index decline, decreasing 4.1%.
Endeavour Silver Corp. had the largest drop, falling 5.5%.
Today, 161 of 227 shares fell, while 65 rose; 9 of 11 sectors were lower, led by energy stocks.
Insights
* This year, the index rose 1.9%, heading for the best year since 2021
* The index advanced 1.5% in the past 52 weeks. The MSCI AC Americas Index gained 15% in the same period
* The S&P/TSX Composite is 5.3% below its 52-week high on Feb. 2, 2023 and 5.6% above its low on Oct. 27, 2023
* The S&P/TSX Composite is up 4.7% in the past 5 days and rose 2.6% in the past 30 days
* S&P/TSX Composite is trading at a price-to-earnings ratio of 15 on a trailing basis and 14.1 times estimated earnings of its members for the coming year
* The index’s dividend yield is 3.4% on a trailing 12-month basis
* S&P/TSX Composite’s members have a total market capitalization of C$3.14t
* 30-day price volatility rose to 15.65% compared with 15.60% in the previous session and the average of 14.30% over the past month
================================================================
| Index Points | |
Sector Name | Move | % Change | Adv/Dec
================================================================
Energy | -26.2498| -0.7| 7/33
Materials | -22.5120| -1.0| 15/36
Information Technology | -10.6844| -0.7| 5/6
Financials | -9.7008| -0.2| 10/18
Real Estate | -6.5973| -1.4| 1/20
Industrials | -5.7088| -0.2| 8/18
Communication Services | -3.8836| -0.5| 0/5
Health Care | -1.3140| -2.3| 0/4
Utilities | -1.0677| -0.1| 7/8
Consumer Discretionary | 0.0863| 0.0| 5/9
Consumer Staples | 6.6994| 0.8| 7/4
================================================================
| | |Volume VS| YTD
|Index Points | | 20D AVG | Change
Top Contributors | Move | % Change | (%) | (%)
================================================================
Nutrien | -10.9200| -4.1|n/a | -25.4
Brookfield Corp | -10.8800| -2.4|n/a | 4.2
Shopify | -10.6100| -1.5|n/a | 76.1
Dollarama | 2.6470| 1.4|n/a | 22.9
Fairfax Financial | 4.6820| 2.4|n/a | 56.3
TD Bank | 4.7460| 0.5|n/a | -7.2
US
By Rita Nazareth
(Bloomberg) — Stocks struggled to gain much traction as bond yields rose, with traders betting the Federal Reserve will lean against the recent easing in financial conditions by saying it will keep its options open on policy.
After notching its best week of 2023 amid dovish Fed bets, oversold technical levels and positioning, the S&P 500 edged slightly higher on Monday.
A reversal of the moves in bonds also weighed on sentiment, with 10-year yields up eight basis points to 4.65%.
Treasuries slid amid a heavy slate of corporate debt sales and ahead of a series of auctions beginning Tuesday.
Wall Street waded through the Senior Loan Officer Opinion Survey — known as SLOOS — which showed tighter standards and weaker demand persist at US banks.
A raft of Fed officials — including Chair Jerome Powell — is due to speak over the next few days.
Swaps are pricing in more than 100 basis points of rate cuts by the end of 2024 from an expected peak rate of 5.37%.
“There may be a reality check ahead on the Fed,” said David
Donabedian, chief investment officer of CIBC Private Wealth US.
“We expect the rest of the year to be volatile, going through ‘manic-depressive swings’ based on where interest rates are headed.”
“The Fed is DONE, DONE, DONE,” wrote Andrew Brenner, head of international fixed-income at NatAlliance Securities. “June is a done deal for a cut, while the markets are building in four rate cuts for next year — expect the Fed to push back on that, if nothing else for optionality. Powell will try to claw back some of the easing of financial conditions.”
To Chris Larkin at E*TRADE from Morgan Stanley, the question on whether the market momentum can be sustained comes down to upcoming economic numbers continuing to point in the same direction as last week’s jobs report, which showed the labor market slowed in October.
“If that cooling trend persists, bulls may embrace the idea that the Fed will grow less hawkish,” Larkin noted. “Regardless, the market has a tendency to pull back in the short term, at least temporarily, after exceptionally big moves like the one that unfolded last week.”
The S&P 500 currently sits at around 4,360 — and chartists are monitoring the 4,355 level, which marks a 50% retracement from the peak-to-trough decline from its July highs to October lows.
If it holds above that, the 4,400 level, where the index hovered during its mid-October highs, is the next number to watch, according to Keith Lerner, co-chief investment officer at Truist Advisory Services.
“To reverse this downtrend, the S&P 500 still needs to break above 4,400,” said Lerner, whose firm is overweight US stocks.
The S&P 500’s best week in a year was just a bear-market rally, according to Morgan Stanley’s Michael Wilson.
Citing a gloomy earnings outlook, weaker macro data and deteriorating analyst views, “we find it difficult to get more excited about a year-end rally,” he added.
Meantime, JPMorgan Chase & Co.’s Marko Kolanovic says equities will soon be unattractive to investors again as the prospect of sustained elevated interest rates and slowing growth come back in focus.
Falling bond yields and dovish central bank meetings were “knee-jerk positive for equities,” but the growth-policy tradeoff will remain challenging into year-end, he noted.
“The question we need to ask ourselves is whether the October breakdown was a ‘bear trap’,” said JC O’Hara, chief market technician at ROTH MKM. “If so, we should expect a swift move higher. If not, we should look to lighten exposure at current levels.”
To Jean Boivin at the research arm at BlackRock Inc., any year-end rally in stocks could prove short-lived because equities don’t fully reflect the outlook for rates remaining higher for longer.
Yields on 10-year Treasuries have tumbled since their 5.02% peak on Oct. 23 as traders for the $26 trillion bond market swung back to pricing the end of rate hikes.
The combination of more benign US refunding needs, weaker-than-expected jobs data and signs of the Fed turning less hawkish may have spurred widespread covering of short positions.
Leveraged funds ramped up net short Treasury futures positions to the most in data going back to 2006, according to an aggregate of the Commodity Futures Trading Commission figures as of Oct. 31.
The bets persisted even though the cash bonds had rallied the week before.
Lori Calvasina at RBC Capital Markets, says the biggest issue on the minds of the equity investors her firm spoke with last week was whether 10-year Treasury yields have really peaked.
“Our view over the last month or so has been that if the surge in yields stopped soon, US equities could escape without incurring too much additional damage,” Calvasina added.  “November has typically been a good month for the S&P 500 from a seasonal perspective. December is also typically a good month, but, like October, there have been some difficult ones in recent history.”
Elsewhere, oil gained after Saudi Arabia and Russia reaffirmed they will stick with oil supply curbs of more than 1 million barrels a day through the end of the year.
Gold declined after briefly climbing above $2,000 an ounce on Friday.

Corporate highlights:
* Tesla Inc. will produce a new model that will cost €25,000v($26,863) at its factory near Berlin, Reuters reported, as competition intensifies to produce more affordable electric vehicles for the European market.
* Tyson Foods Inc., the largest US meat producer, is recalling almost 30,000 pounds (13 metric tons) of chicken nuggets aimed at children due to possible contamination with metal pieces.
* Dish Network Corp. reported disappointing third-quarter revenue and a drop in wireless customers that was much worse than analysts predicted.
* Berkshire Hathaway Inc.’s cash pile scaled a fresh record at $157.2 billion, bolstered both by elevated interest rates and a dearth of meaningful deals where billionaire investor Warren Buffett could put his money to work.
* Bumble Inc. Chief Executive Officer Whitney Wolfe Herd will step down from the company she founded nearly 10 years ago.
* Ryanair Holdings Plc will pay out a dividend of €400 million ($430 million) and plans to hand over about a quarter of annual profit to shareholders as Europe’s biggest discount airline benefits from growing traffic.

Key events this week:
* Australia rate decision, Tuesday
* China trade, forex reserves, Tuesday
* Eurozone PPI, Tuesday
* US trade, Tuesday
* UBS earnings, Tuesday
* Kansas City Fed President Jeff Schmid and his Dallas counterpart Lorie Logan speak, Tuesday
* Eurozone retail sales, Wednesday
* Germany CPI, Wednesday
* BOE Governor Andrew Bailey speaks, Wednesday
* US wholesale inventories, Wednesday
* New York Fed President John Williams speaks, Wednesday
* Bank of Japan issues October summary of opinions, Thursday
* BOE chief economist Huw Pill speaks on the economy, Thursday
* US initial jobless claims, Thursday
* Fed Chair Jerome Powell participates in panel on monetary policy challenges at the IMF’s annual research conference in Washington, Thursday
* Atlanta Fed President Raphael Bostic and his Richmond counterpart Tom Barkin speak, Thursday
* UK industrial production, GDP, Friday
* ECB President Christine Lagarde participates in fireside chat, Friday
* US University of Michigan consumer sentiment, Friday
* Dallas Fed President Lorie Logan and her Atlanta counterpart Raphael Bostic speak, Friday

Some of the main moves in markets:
Stocks
* The S&P 500 rose 0.2% as of 4 p.m. New York time
* The Nasdaq 100 rose 0.4%
* The Dow Jones Industrial Average rose 0.1%
* The MSCI World index rose 0.4%
Currencies
* The Bloomberg Dollar Spot Index was little changed
* The euro fell 0.1% to $1.0720
* The British pound fell 0.3% to $1.2344
* The Japanese yen fell 0.4% to 150.00 per dollar
Cryptocurrencies
* Bitcoin rose 1% to $35,035.41
* Ether rose 1.4% to $1,895.19
Bonds
* The yield on 10-year Treasuries advanced eight basis points to 4.65%
* Germany’s 10-year yield advanced nine basis points to 2.74%
* Britain’s 10-year yield advanced nine basis points to 4.38%
Commodities
* West Texas Intermediate crude rose 0.4% to $80.86 a barrel
* Spot gold fell 0.7% to $1,978.26 an ounce
This story was produced with the assistance of Bloomberg Automation.
–With assistance from Vildana Hajric, Farah Elbahrawy, Sagarika Jaisinghani, Ruth Carson and David Finnerty.
Have a lovely evening.

Be magnificent!
As ever,
Carolann

The human being is born with an incurable capacity for making the best of things. –Helen Keller, 1880-1968.
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