October 17,2022 Newsletter

Dear Friends,

Tangents: Happy Monday.
On Oct. 17, 1931, mobster Al Capone was convicted of income tax evasion and sentenced to 11 years in prison. He was released in 1939.  Go to article »

25 creepy-cute dishes for a Halloween potluck.  Bone appétit! Who can resist goblin up these festive appetizers and snacks?

1,600-year-old mosaic of Hercules and Neptune’s 40 mistresses unearthed in war-torn Syria: Archaeologists in war-torn Syria have unearthed a stunning mosaic from the Roman era that features events from the Trojan War, the chiseled muscles of the Roman demigod Hercules and the powerful ancient Roman god Neptune alongside 40 of his mistresses.   The General Directorate of Antiquities and Museums, a Syrian government agency, discovered the 65.5-foot-long by 20-foot-wide (20 by 6 meters) mural in Rastan, a town in central Syria near Homs, a key battleground during the Syrian revolution, agency representatives announced on Wednesday (Oct. 12), according to the Associated Press (AP).  Full Story: Live Science (10/17)

Bizarre blue blobs hover in Earth’s atmosphere in stunning astronaut photo. But what are they?   An astronaut onboard the International Space Station (ISS) has snapped a peculiar image of Earth from space that contains two bizarre blue blobs of light glimmering in our planet’s atmosphere.   The dazzling pair may look otherworldly. But in reality, they are the result of two unrelated natural phenomena that just happened to occur at the same time.  Full Story: Live Science (10/17)

PHOTOS OF THE DAY

A person wears a horror costume. After a three-year absence, zombies and horrible creatures once again marched through the streets of Santiago for Zombie Walk Chile, a huge Halloween costume party, that attracts large numbers of people
Photograph: Claudio Abarca Sandoval/NurPhoto/REX/Shutterstock

People watch the world’s strongest maelstrom from a boat. The whirlpool phenomenon is governed by the rise and fall of currents. Every six hours almost 400m cubic metres of water have to pass through a 3 km-long and 150-metre wide strait between Saltenfjord and Skjerstadfjord
Photograph: Sergei Gapon/Anadolu Agency/Getty Images

People visit Iguazu falls at the Iguazu national park
Photograph: Reuters
Market Closes for October 17, 2022

International Markets

Bonds

Currencies

Commodities

Market Commentary:
On this day in 1919, Radio Corporation of America was formed by General Electric lawyer Owen D. Young to control the “wireless” patents of GE, AT&T and Westinghouse and to outflank the companies founded by Guglielmo Marconi. By 1929 it was the greatest growth stock in America, peaking at just under $575 a share; but by the end of that year it had lost 77% of its value.
Canada
By Bloomberg Automation
(Bloomberg) — The S&P/TSX Composite rose 1.6% at 18,621.02 in Toronto.
The index advanced to the highest closing level since Oct. 6 after the previous session’s decrease of 1.5%.
Canadian National Railway Co. contributed the most to the index gain, increasing 2.7%.
Denison Mines Corp. had the largest increase, rising 10.5%.
Today, 202 of 236 shares rose, while 33 fell; all sectors were higher, led by financials stocks.
Insights
* In the past year, the index had a similar or greater gain 13 times. The next day, it advanced eight times for an average 0.9% and declined five times for an average 1.1%
* This year, the index fell 12%, heading for the worst year in at least 10 years
* The index declined 11% in the past 52 weeks. The MSCI AC Americas Index lost 19% in the same period
* The S&P/TSX Composite is 16.2% below its 52-week high on April 5, 2022 and 4.2% above its low on Oct. 13, 2022
* The S&P/TSX Composite is little changed in the past 5 days and fell 3.9% in the past 30 days
* S&P/TSX Composite is trading at a price-to-earnings ratio of 12.6 on a trailing basis and 11.5 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$2.93t
* 30-day price volatility rose to 23.70% compared with 23.23% in the previous session and the average of 19.14% over the past month
================================================================
|Index Points | |
Sector Name | Move | % Change | Adv/Dec
================================================================
Financials | 87.6484| 1.5| 28/1
Industrials | 57.0447| 2.4| 26/1
Information Technology | 31.7515| 3.3| 14/0
Energy | 30.0977| 0.9| 24/13
Materials | 24.8002| 1.2| 36/15
Utilities | 22.0647| 2.6| 16/0
Communication Services | 13.0963| 1.5| 7/0
Consumer Discretionary | 10.3604| 1.6| 13/1
Real Estate | 10.2758| 2.2| 22/0
Consumer Staples | 4.1152| 0.5| 9/2
Health Care | 3.4328| 4.5| 7/0
================================================================
| | |Volume VS |
| Index | | 20D AVG |YTD Change
Top Contributors |Points Move| % Change | (%) | (%)
================================================================
Canadian National | 17.1800| 2.7| 32.7| -1.8
RBC | 15.7500| 1.3| 64.1| -7.9
Shopify | 15.5200| 5.3| -15.8| -78.1
First Quantum Minerals | -1.3120| -1.4| -10.3| -20.8
ARC Resources | -1.5560| -1.9| -29.4| 53.5
Tourmaline Oil | -2.4140| -1.5| 98.1| 99.4
US
By Rita Nazareth
(Bloomberg) — Stocks saw big gains Monday, with the S&P 500 closing above a key technical level and another giant bank coming out with solid results.
A reversal of the UK’s vast fiscal stimulus also bolstered trader sentiment.
The breadth of the rally was so strong that at one point over 99% of the companies in the US equity benchmark were up, with the gauge pushing away from its 200-week moving average.
The tech-heavy Nasdaq 100 notched its biggest gain since July.
A rout in the S&P 500 has left the index testing a “serious floor of support”, which could lead to a technical recovery, Morgan Stanley’s Mike Wilson wrote.
The strategist, who’s one of Wall Street’s most-prominent bearish voices, said he “would not rule out” the measure rising to about 4,150.
That’s 13% above current levels.
“Stocks may be ripe for a near-term bounce,” wrote BCA Research strategists led by Roukaya Ibrahim. “While economic conditions have not changed — and therefore do not warrant a shift in the cyclical outlook — technical conditions are pointing to a potential rebound.”
The arrival of earnings has historically served as a remedy for ailing equities, lifting the S&P 500 roughly 76% of the time since 2013.
Cut-to-bone profit estimates — which have been slashed down by more than two-thirds in four months, the most since the first quarter of 2020 — are making the hurdles easy to clear.
To Jeffrey Buchbinder at LPL Financial, while expectations are indeed very low for the current earnings season, forecasts for 2023 still remain elevated.
“The tough part is figuring out how far estimates need to fall and how much of a headwind that haircut will be for stocks as they try to dig their way out of this bear market,” he added.
Markets have historically bottomed out when investors began to contemplate materially looser policy over the next six to 12 months, when a trough for economic activity was in sight or when valuations reflected a “bear case” scenario, according to Mark Haefele at UBS Global Wealth Management.  “We do not believe these conditions have been fulfilled,” Haefele added. “Despite the increased risks to growth and the rise in volatility, equity markets have neither become cheaper relative to bonds, nor yet priced in a material slowdown in growth and earnings.”
Some 86% of respondents in the latest MLIV Pulse survey expect US markets to recover first, with investors slightly favoring stocks over bonds.
The result suggests the longstanding premium for equities will remain in place — and as the Federal Reserve’s peak hawkishness becomes apparent, traders will be prepared to return to Treasury markets in droves.
The latest US recession probability models by Bloomberg economists Anna Wong and Eliza Winger forecast a higher probability of such an event across all time frames — with the 12-month estimate of a downturn by October 2023 hitting 100%.
That’s up from 65% for the comparable period in the previous update.
Data Monday showed a measure of New York state manufacturing contracted for a third month in October, and a larger share of factories were more downbeat about business conditions in early 2023.
The prices-paid measure rose for the first time since June.
“This isn’t a Pollyanna moment,” said Robert Teeter, a managing director of Silvercrest Asset Management. “Inflation clearly remains a problem until proven otherwise, and disappointing earnings, particularly from consumer facing-companies, could trigger another rough stretch, with recession fears at the fore.”
Key events this week:
* US industrial production, NAHB housing market index, Tuesday
* Fed’s Neel Kashkari speaks, Tuesday
* Euro area CPI, Wednesday
* EIA crude oil inventory report, Wednesday
* US MBA mortgage applications, building permits, housing starts, Fed Beige Book, Wednesday
* Fed’s Neel Kashkari, Charles Evans, James Bullard speak, Wednesday
* US existing home sales, initial jobless claims, Conference Board leading index, Thursday
* Euro area consumer confidence, Friday

Some of the main moves in markets:
Stocks
* The S&P 500 rose 2.7% as of 4 p.m. New York time
* The Nasdaq 100 rose 3.5%
* The Dow Jones Industrial Average rose 1.9%
* The MSCI World index rose 2.1%
Currencies
* The Bloomberg Dollar Spot Index fell 0.7%
* The euro rose 1.2% to $0.9837
* The British pound rose 1.6% to $1.1352
* The Japanese yen fell 0.2% to 149.04 per dollar
Cryptocurrencies
* Bitcoin rose 1% to $19,527.35
* Ether rose 1.1% to $1,325.63
Bonds
* The yield on 10-year Treasuries was little changed at 4.02%
* Germany’s 10-year yield declined eight basis points to 2.27%
* Britain’s 10-year yield declined 36 basis points to 3.98%
Commodities
* West Texas Intermediate crude fell 0.2% to $85.40 a barrel
* Gold futures rose 0.3% to $1,653.70 an ounce
–With assistance from Vildana Hajric, Michael Msika and Sagarika Jaisinghani.
Have a lovely evening.

Be magnificent!

As ever,

Carolann

Nothing in any life, no matter how well or poorly lived, is wiser than failure or clearer than sorrow. -Gregory David Roberts, b. 1952.

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