October 16,2023, Newsletter

Dear Friends,

Tangents: Happy Monday.

October 16^th, 1956: The Hungarian Revolution of 1956 begins as a peaceful student demonstration turns into a nationwide uprising.
On Oct. 16, 1964, China detonated its first atomic bomb.  Go to article >>

1793:Marie Antoinette executed.
1853: Crimean War.
Oscar Wilde, b. 1854.
Noah Webster, b. 1758.

‘Ring of fire’ eclipse appears over the Americas
In case you missed it, a solar eclipse created a “ring of fire” in the skies over the Americas on Saturday. See photos here.

‘Star Wars’ X-wing model fetches over $3.1 million at auction
This miniature movie prop was considered one of the most coveted “Star Wars” artifacts to ever reach the market. It just sold for over $3.1 million.

Taylor Swift’s concert movie brought in about $96 million at the box office
Dancing Swifties packed movie theaters to see the debut of the pop singer’s concert film. Theater chain AMC expects it to play “to big audiences for several weeks to come.”

Transforming Beethoven’s music
Grammy winner Jon Batiste can seamlessly transform Beethoven’s symphonies across different genres! Watch his impressive demonstration during an interview with CNN’s Chris Wallace.

‘Earth’s civilizations are shaped by what the ocean engine does,’ says oceanographer Helen Czerski
In this interview, British oceanographer Helen Czerski explains the systems driving our ocean and explains what the next great ocean frontier is. Read More.

Most detailed human brain map ever contains 3,300 cell types
The most detailed atlas of the human brain ever devised includes many cell types we’ve never seen before. Read More.

PHOTOS OF THE DAY

Dunnottar Castle, Scotland
The sun rises creating a cascade of colour over Dunnattar Castle, a ruined medieval fortress located on a rocky headland on the north-east coast of Scotland.  Photograph: Charlotte Graham/Shutterstock.

Toronto, Canada
Salmon leap up the Old Mill Dam on the Humber River to spawn. Hundreds of fish make their way up from Lake Ontario to the spawning grounds during the annual migration season.  Photograph: Anadolu Agency/Anadolu/Getty Images

Tuna el-Gebel, Egypt
A mummy coffin inside a rock-cut tomb at a cemetery dating back to the New Kingdom of ancient Egypt has been unearthed at Tuna el-Gebel necropolis.  Photograph: Xinhua/Shutterstock
Market Closes for October 16^th, 2023

International Markets

Bonds

Currencies

Commodities

Market Commentary:
On this day in 2001, Enron surprised investors by reporting a $618 million loss after it wrote down soured investments. Chairman and Chief Executive Kenneth Lay also divulged it had cut its shareholder equity by $1.2 billion, meaning Enron was suddenly worth a lot less money. The company filed for bankruptcy less than two months later.
Canada
By Bloomberg Automation
(Bloomberg) — The S&P/TSX Composite rose 0.8% at 19,620.80 in Toronto.
The move follows the previous session’s decrease of 0.2%.
Shopify Inc. contributed the most to the index gain, increasing 3.0%.
Lithium Americas Corp. had the largest increase, rising 7.3%.
Today, 163 of 227 shares rose, while 63 fell; all sectors were higher, led by financials stocks.
Insights
* This year, the index rose 1.2%, heading for the best year since 2021
* The index advanced 7.1% in the past 52 weeks. The MSCI AC Americas Index gained 21% in the same period
* The S&P/TSX Composite is 5.9% below its 52-week high on Feb. 2, 2023 and 7.1% above its low on Oct. 14, 2022
* The S&P/TSX Composite is up 1.9% in the past 5 days and fell 4.9% in the past 30 days
* S&P/TSX Composite is trading at a price-to-earnings ratio of 14.9 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$3.09t
* 30-day price volatility fell to 14.05% compared with 14.38% in the previous session and the average of 13.69% over the past month
================================================================
|Index Points | |
Sector Name | Move | % Change | Adv/Dec
================================================================
Financials | 65.2653| 1.1| 25/3
Information Technology | 23.8337| 1.7| 8/3
Energy | 18.0127| 0.5| 27/13
Industrials | 16.6386| 0.6| 19/7
Materials | 15.1023| 0.7| 33/19
Communication Services | 9.4883| 1.3| 3/2
Consumer Discretionary | 3.9184| 0.6| 8/6
Real Estate | 3.7578| 0.8| 20/1
Health Care | 1.2768| 2.3| 4/0
Consumer Staples | 0.3305| 0.0| 8/3
Utilities | 0.3284| 0.0| 8/6
================================================================
| | |Volume VS| YTD
| Index | | 20D AVG | Change
Top Contributors |Points Move|% Change | (%) | (%)
================================================================
Shopify | 17.5500| 3.0|n/a | 54.3
RBC | 16.1900| 1.5|n/a | -8.7
TD Bank | 11.4200| 1.1|n/a | -7.3
Cenovus Energy | -2.0700| -0.8|n/a | 8.8
Agnico Eagle Mines | -2.6280| -1.2|n/a | -6.8
Brookfield Infrastructure | -4.4880| -3.9|n/a | -18.6
US
By Rita Nazareth
(Bloomberg) — Stocks rose and bonds fell amid diplomatic efforts to prevent the Israel-Hamas war from expanding into a regional conflict. Oil declined, following last week’s rally.
The S&P 500 added 1.1%, with traders also gearing up for a raft of earnings reports.
Treasury 10-year yields climbed nine basis points to 4.71%.
The dollar retreated.
Bitcoin pared gains after surging as much as 10% as BlackRock said its application for an exchange-traded fund that invests directly in the cryptocurrency is still under review.
The Israeli shekel hit an eight-year low.
Wall Street’s haven bid waned, with President Joe Biden considering a trip to Israel as part of a push to prevent the war from spreading.
Secretary of State Antony Blinken also returned to Israel to meet Prime Minister Benjamin Netanyahu, after talks with Arab governments.
Russian President Vladimir Putin held a call with the leaders of Egypt, Syria, Iran and the Palestinian Authority, and the Kremlin said there was a “unanimous opinion” on the need for a cease-fire.
He spoke separately with Netanyahu.
“The price action doesn’t reflect an improvement in investors’ outlook for the Israeli conflict, rather the absence of a significant escalation,” said Ian Lyngen, head of US rates strategy at BMO Capital Markets.
Aside from geopolitics, traders will also be focused on corporate results this week.
The outlook for earnings is weakening and could remain subdued, according to strategists from Morgan Stanley to JPMorgan Chase & Co.
As the reporting season kicks off, Morgan Stanley’s Michael Wilson said earnings revisions breadth — referring to the number of stocks seeing upgrades versus downgrades — for the S&P 500 has fallen sharply over the past couple of weeks.
Citigroup Inc.’s index of earnings revisions shows downgrades have outpaced upgrades for four straight weeks ahead of the reporting season.
JPMorgan strategist Mislav Matejka expects this to continue.
Yet stock price reactions show the reporting season is “off to a good start,” with Russell 1000 firms that beat estimates outperforming at the second-highest rate in the past year and a half, according to RBC Capital Markets strategists.
Investors looking to earnings season for a dose of good news are hanging their hopes on a familiar group: Big Tech.
The five biggest companies in the S&P 500 — Apple Inc., Microsoft Corp., Alphabet Inc., Amazon.com Inc. and Nvidia Corp. — account for about a quarter of the benchmark’s market capitalization.
Their earnings are projected to jump 34% from a year earlier on average, according to analyst estimates compiled by Bloomberg Intelligence.
Meantime, BlackRock Inc. strategists are modifying their underweight approach to Treasury bonds, though not enough to send a buy signal as a relentless rise in 10-year yields promises to provide volatility that can swing the market up or down.
“We turn tactically neutral long-term Treasuries as markets price high-for-longer policy rates but stay underweight strategically,” the asset manager said in its weekly research note published Monday. “US 10-year yields at 16-year highs show they have adjusted a lot — but we don’t think the process is over.”
In economic news, a measure of New York state factory activity contracted in October, reflecting a pullback in demand.
Federal Reserve Bank of Philadelphia President Patrick Harker repeated comments he made last week asserting the central bank can hold its benchmark rate steady as long as there is not a sharp turn in the economic data.
The European Central Bank is watching the oil price for any inflationary impact from the Israel-Hamas conflict, President Christine Lagarde told euro-area finance ministers, according to people familiar with the matter.

Corporate Highlights
* Charles Schwab Corp. rallied as its executives said the firm’s cash-sorting problems — with clients moving money from the bank into higher-yielding products — are beginning to abate despite persistently elevated interest rates.
* Pfizer Inc.’s announcement that it will cut $9 billion from annual sales guidance due to declining demand for Covid shots and pills was met with relief by investors eager to understand the company’s post-pandemic growth strategy.
* Lululemon Athletica Inc. climbed on news the athleisure company will join the S&P 500, with the stock gaining for a seventh straight session.
* Apple’s new iPhone 15 is selling far worse in China than its predecessor, according to separate studies, reflecting stubbornly weak consumption as well as the rise of rivals like Huawei Technologies Co.
* Ford Motor Co. is calling on the United Auto Workers to end its more than monthlong strike, warning that if the work stoppage continues it will hurt both local communities and the broader US economy.
* US pharmacy chain Rite Aid Corp. filed for bankruptcy in an effort to close unprofitable stores, address lawsuits over its role in the opioid pandemic and rework a debt load of roughly $4 billion.
Key events this week:
* Chinese President Xi Jinping hosts world leaders at the Belt and Road Initiative forum from Tuesday to Wednesday, with Russian President Vladimir Putin expected to attend
* Joint European Central Bank/IMF policy and research conference, Tuesday
* Germany ZEW survey expectations, Tuesday
* UK jobless claims, unemployment, Tuesday
* US retail sales, business inventories, industrial production, Tuesday
* Goldman Sachs, Bank of America earnings, Tuesday
* New York Fed President John Williams moderates discussion, while Richmond Fed President Tom Barkin speaks at a separate event, Tuesday
* Reserve Bank of Australia Governor Michele Bullock speaks, Wednesday
* China GDP, retail sales, industrial production, Wednesday
* UK CPI, Wednesday
* Eurozone CPI, Wednesday
* Morgan Stanley, Netflix, Tesla earnings, Wednesday
* Federal Reserve issues Beige Book economic survey, Wednesday
* Philadelphia Fed President Patrick Harker and New York Fed President John Williams speak at separate events, Wednesday
* Australia unemployment, Thursday
* Japan trade, Thursday
* China property prices, Thursday
* US initial jobless claims, existing home sales, leading index, Thursday
* Federal Reserve Chair Jerome Powell, Chicago Fed President Austan Goolsbee, Atlanta Fed President Raphael Bostic, Philadelphia Fed President Patrick Harker, Dallas Fed President Lorie Logan speak at different events, Thursday
* Japan CPI, Friday
* China loan prime rates, Friday
* Philadelphia Fed President Patrick Harker speaks, Friday

Some of the main moves in markets:
Stocks
* The S&P 500 rose 1.1% as of 4 p.m. New York time
* The Nasdaq 100 rose 1.2%
* The Dow Jones Industrial Average rose 0.9%
* The MSCI World index rose 0.7%
Currencies
* The Bloomberg Dollar Spot Index fell 0.4%
* The euro rose 0.5% to $1.0562
* The British pound rose 0.6% to $1.2217
* The Japanese yen was little changed at 149.52 per dollar
Cryptocurrencies
* Bitcoin rose 4.7% to $28,482.5
* Ether rose 1.7% to $1,590.63
Bonds
* The yield on 10-year Treasuries advanced nine basis points to 4.71%
* Germany’s 10-year yield advanced five basis points to 2.79%
* Britain’s 10-year yield advanced nine basis points to 4.48%
Commodities
* West Texas Intermediate crude fell 0.8% to $86.96 a barrel
* Gold futures fell 0.5% to $1,932.20 an ounce
This story was produced with the assistance of Bloomberg Automation.
–With assistance from Farah Elbahrawy.
Have a lovely evening.

Be magnificent!
As ever,

Carolann
On personal integrity hangs humanity’s fate. –Buckminster Fuller, 1895-1983.

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