October 31, 2024 Newsletter

Dear Friends,

Tangents: Happy Friday Eve & Happy Halloween!
Samhain: Wiccan New Year.

On October 31^st, 1973, the United States ended its worldwide military alert called during hostilities in the Middle East.  Go to article 

John Keats, poet, b. 1795.
Helmut Newton, photographer, b. 1920.
Harry Houdini, magician, b. 1926.
Dan Rather, TV journalist, b. 1931.

Archaeologists discover 4,000-year-old Bronze Age settlement hidden in Saudi Arabian oasis
A Bronze Age settlement hidden on the Arabian Peninsula reveals secrets about the slow growth of urbanization in the region.  Read More.

‘We are teetering on a planetary tightrope’: Cut emissions in half right now to prevent climate catastrophe, UN warns
A new U.N. report has found the world will warm by twice the 1.5-degree-Celsius target adopted in the Paris Agreement by 2100 if countries fail to slash greenhouse gas emissions right now. Read More

Voyager 1 loses contact with NASA, turns on retro transmitter not used since 1981
NASA lost contact with the interstellar Voyager 1 spacecraft for nearly a week after a technical glitch shut off the probe’s main transmitter. Using Voyager’s weaker backup transmitter, engineers are assessing the problem from 15 billion miles away. Read More.

How to get better faster when you have the flu, according to science
Are there any scientifically proven ways to shorten a flu infection? Live Science spoke with two experts to find out. Read More.

King Charles and Queen Camilla take private trip to India
Britain’s King Charles III and Queen Camilla made a surprise pitstop in India as they returned from their royal tour to Australia and Samoa.

A refreshing change: Starbucks to make popular add-on free of charge
Starting next week, Starbucks customers will no longer pay more for adding soy, oat, almond or coconut milk to their orders. Read about the new pricing.

PHOTOS OF THE DAY

A female Allen’s hummingbird rests on the leaf of an amaryllis plant in a suburban garden of Orange County, California, US. She is less than 3.5in (89mm) long, and weighs about the same as a sheet of A4 paper
Photograph: Bruce Chambers/Zuma Press Wire/Rex/Shutterstock

Right under his nose … a monkey climbs on a statue at the entrance to the Golden Temple of Dambulla, Sri Lanka
Photograph: Ishara S Kodikara/AFP/Getty Images

​​​​​​​Coventry, UK
‘The coloured glass windows in the cathedral are amazing, but looking up from the base shows sunlight spilling over the concrete.’
Photograph: Simon White
Market Closes for October 31^st, 2024

International Markets

Bonds

Currencies

Commodities

Market Commentary:
📈 On this day in 1933, Albert Wiggin, the former president of the Chase National Bank, testified that his personal investment companies had borrowed money from Chase to short-sell Chase’s own stock. Congress then added a provision to the Securities Exchange Act, banning corporate officers from short-selling their own shares.
Canada
By Bloomberg Automation
(Bloomberg) — The S&P/TSX Composite fell for the third day, dropping 1.4%, or 350.92 to 24,156.87 in Toronto.
The move was the biggest since falling 2.2% on Aug. 2.
Today, financials stocks led the market lower, as 10 of 11 sectors lost; 182 of 222 shares fell, while 37 rose.
Royal Bank of Canada contributed the most to the index decline, decreasing 2.0%.
Veren Inc. had the largest drop, falling 14.4%.
Insights
* In the past year, the index had a similar or greater loss four times. The next day, it declined twice for an average 1.6% and advanced twice for an average 1.1%
* This year, the index rose 15%, heading for the best year since 2021
* This month, the index rose 0.7%
* So far this week, the index fell 1.3%
* The index advanced 28% in the past 52 weeks. The MSCI AC Americas Index gained 36% in the same period
* The S&P/TSX Composite is 3.1% below its 52-week high on Oct. 21, 2024 and 28.3% above its low on Oct. 31, 2023
* The S&P/TSX Composite is down 1.6% in the past 5 days and rose 0.7% in the past 30 days
* S&P/TSX Composite is trading at a price-to-earnings ratio of 19.3 on a trailing basis and 16.8 times estimated earnings of its members for the coming year
* The index’s dividend yield is 2.9% on a trailing 12-month basis
* S&P/TSX Composite’s members have a total market capitalization of C$3.88t
* 30-day price volatility rose to 7.47% compared with 6.68% in the previous session and the average of 8.24% over the past month
================================================================
| Index Points | |
Sector Name | Move | % Change | Adv/Dec
================================================================
Financials | -111.7783| -1.4| 1/26
Materials | -77.2207| -2.4| 2/49
Information Technology| -55.5918| -2.7| 1/9
Industrials | -36.5673| -1.2| 5/22
Energy | -34.1274| -0.8| 14/26
Consumer Staples | -18.1242| -1.8| 0/11
Real Estate | -8.7440| -1.7| 0/19
Consumer Discretionary| -7.6479| -0.9| 3/8
Communication Services| -2.5355| -0.4| 2/3
Utilities | -1.4778| -0.2| 7/7
Health Care | 2.9138| 3.8| 2/2
================================================================
| | |Volume VS| YTD
|Index Points| | 20D AVG | Change
Top Contributors | Move |% Change | (%) | (%)
================================================================
RBC | -34.1300| -2.0| -18.9| 25.7
Shopify | -19.7200| -2.1| 61.4| 5.6
Constellation Software | -18.2600| -3.1| 49.2| 27.8
South Bow | 1.4790| 3.0| -52.0|n/a
Capital Power | 1.9710| 4.0| 61.1| 49.2
Bausch Health | 3.0300| 12.7| 213.4| 20.5
US
By Rita Nazareth
(Bloomberg) — Stocks got hit as disappointing outlooks from Microsoft Corp. and Meta Platforms Inc. fueled concern that a nearly 45% surge in the megacaps that have powered the bull market might have gone too far.
Oil jumped on a report Iran is planning a fresh attack on Israel.
A 1.5% slide in the S&P 500 Thursday wiped out the gauge’s advance for October, halting a streak of monthly gains that would have been the longest since 2021.
The Nasdaq 100 dropped 2.2%. All megacaps retreated amid concerns on whether the cohort can sustain massive profit growth while investing billions of dollars in artificial intelligence.
Those worries hit a market showing signs of exhaustion near record highs ahead of next week’s US election and the Federal Reserve decision.
Another pair of tech titans — Apple Inc. and Amazon.com Inc. — will report results after the close.
“Halloween is bringing tricks, not treats to many investors,” said Steve Sosnick at Interactive Brokers. “The market’s mindset seems to be switching from one where anything AI-related was a reason for enthusiasm towards one where investors are looking for some returns on their massive spending.”
Moreover, there’s a nearly palpable narrative taking hold that the election – rather than offering a sense of certainty -will cause volatility to spike, noted Quincy Krosby at LPL Financial.
That’s not to mention the jobs report on Friday.
In the run-up to the figures, data showed unemployment claims fell to their lowest since May while a key inflation gauge picked up.
Treasuries didn’t do much on Thursday, but finished lower for the month on bets the Fed won’t be too aggressive with rate cuts amid a strong economy.
The dollar is seeing its best month since 2022.
Traders are preparing for a surge in global currency volatility after the cost of hedging dollar moves over the next week climbed to the most expensive since 2020.
The yen jumped as much as 1%, extending gains seen after Bank of Japan Governor Kazuo Ueda said that currency markets have had a major impact on the economy, pointing to another potential rate hike in coming months.
Chancellor of the Exchequer Rachel Reeves sought to reassure the financial markets after her budget on Wednesday triggered a selloff in UK bonds.
Gold retreated as some investors booked profit after the metal’s rally to a fresh record.
The guidance out of Microsoft and Meta raise some of the same questions that we heard during the last earnings season, according to Matt Maley at Miller Tabak + Co.
“Thankfully, Alphabet did show some signs that their ROI on the AI phenomenon is bearing some fruit,” Maley said.
“However, last night’s results do seem to indicate that it could still be a much longer time for these returns to build up in a significant way for many companies — at least when you compare it to the timeframe investors have been assuming for much of this year.”
If that is indeed the case, it’s going to be much tougher for the investors to justify today’s very expensive stock market which is especially true given that longer-term yields have been rising at a steady and material pace over the past six weeks, Maley noted.
Investors need to make sure they have diversification within tech and that they are not solely invested in the parts of the AI trade that have worked such as semiconductors, according to Michael Landsberg, chief investment officer, Landsberg Bennett Private Wealth Management.
“It makes some sense to trim some from those names that have worked so well over the past 12-18 months and look for AI laggards as well as other tech themes like cybersecurity, robotics and automation, and smart homes and cities,” he said.
Equity bulls bracing for a string of market-moving events in the next couple of days have favorable seasonality on their side.
The S&P 500 has historically posted a 1.56% return in November, CFRA’s data going back to 1945 show, in what’s been the second-best month of the year for the index.
This century, the gauge was down in November just on six occasions.
“The S&P 500 is slightly lower in October, but luckily, November seasonality is a big tailwind,” said Bespoke Investment Group strategists.
Over the past 100 years, November has ranked as the fourth-best month with an average gain of 1.3% and positive performance 63% of the time, they said.
More recently in the past 50 years, it is one of two months (the other being April) in which the index has averaged a gain of more than 2%.
In that timeframe, it also traded higher more consistently than any month.
Looking only at the past twenty years, November’s 2.43% average gain is only edged out by July’s 2.45% gain for the best month of the year, Bespoke concluded.

Corporate Highlights:
* OpenAI is adding a new set of search features to its flagship product ChatGPT, escalating the artificial intelligence startup’s challenge to Alphabet Inc.’s Google.
* Waymo, Alphabet Inc.’s autonomous driving unit, was valued at more than $45 billion, including its latest round of financing, according to people familiar with the matter.
* Root Inc. shares are having their best day ever on Thursday after the auto insurance platform announced that it had turned profitable for the first time in its history.
* Mastercard Inc. reported profit that beat analysts’ estimates, helped by a boost in cross-border transactions.
* Merck & Co. lowered the top end of its full-year sales guidance after demand for its HPV vaccine fell for a second straight quarter in China.
* Uber Technologies Inc. reported weaker-than-expected ride bookings and issued a middling forecast for the holiday quarter, even as it delivered record operating profit.
* ConocoPhillips raised its production forecast for the year after surpassing output expectations in the third quarter.
* Estée Lauder Cos. pulled its guidance for the year, citing uncertainty over a new chief executive and weak demand in China.
* Roblox Corp., a video-game company, reported third-quarter bookings that beat analysts’ expectations and boosted its guidance for the full year, as the platform’s user base surged.
* Norwegian Cruise Line Holdings Ltd. boosted its profit outlook for a fourth time this year as demand for sailings remains high, defying fears a slowdown in the wider leisure travel industry.
* MetLife Inc. tumbled after the insurer reported third-quarter private equity returns that weighed on variable investment income.
* Peloton Interactive Inc. shares soared after the fitness company named Ford Motor Co. executive Peter Stern as its next chief executive officer and delivered improving profitability.
* Carvana Co. surged after the online used-car retailer reported higher-than-expected results for the most recent quarter, as growing sales and cost cutting brought about stronger profits and a better outlook for the rest of the year.
* Comcast Corp. said it’s considering spinning off its cable networks into a new company as it grapples with the continuing industry-wide decline in subscribers.
* DoorDash Inc. beat Wall Street’s expectations on virtually every key earnings metric, allowing the delivery service to post its first operating profit since the start of the pandemic.
* Robinhood Markets Inc. fell after the brokerage reported revenue that missed analyst estimates because of a customer promotion program that required the firm to offset a portion of the haul.
* Roku Inc., a manufacturer of set-top boxes used to stream TV,  said it will no longer report the number of households that use its products each quarter, starting next year.
* Cigna Group jumped after Chief Executive Officer David Cordani signaled the company is focused on returning cash to shareholders through buybacks rather than a possible deal with Humana Inc.
* Clorox Co. raised its annual profit guidance after increased advertising helped the bleach maker fully regain the market share that it lost when a cyberattack disrupted production last year.
* Bristol Myers Squibb Co. raised its 2024 earnings guidance after reporting better-than-expected revenue and profit, fueled by demand for the blood-thinner Eliquis and several newer treatments.
* Altria Group Inc. kicked off a plan to cut at least $600 million of costs over the next five years as the tobacco group maintained its outlook for the year.
* MicroStrategy Inc. has hired banks to help it raise $42 billion through the sale of new shares and fixed income to buy more Bitcoin after a flurry of deals over the past year.
* Coinbase Global Inc., the largest US crypto exchange, posted results below Wall Street expectations even though revenue almost doubled.
* Samsung Electronics Co. declared progress in supplying its most advanced AI memory chips to Nvidia Corp., seeking to reassure to investors who fear the company is falling further behind SK Hynix Inc. in a red-hot market.

Key events this week:
* China Caixin manufacturing PMI, Friday
* US employment, ISM manufacturing, Friday

Some of the main moves in markets:
Stocks
* The S&P 500 fell 1.5% as of 3:39 p.m. New York time
* The Nasdaq 100 fell 2.2%
* The Dow Jones Industrial Average fell 0.7%
* The MSCI World Index fell 1.3%
* Bloomberg Magnificent 7 Total Return Index fell 3.1%
Currencies
* The Bloomberg Dollar Spot Index fell 0.2%
* The euro rose 0.1% to $1.0872
* The British pound fell 0.6% to $1.2883
* The Japanese yen rose 0.9% to 152.04 per dollar
Cryptocurrencies
* Bitcoin fell 3.5% to $70,286.1
* Ether fell 5.9% to $2,519.34
Bonds
* The yield on 10-year Treasuries declined two basis points to 4.28%
* Germany’s 10-year yield was little changed at 2.39%
* Britain’s 10-year yield advanced nine basis points to 4.45%
Commodities
* West Texas Intermediate crude rose 2.9% to $70.58 a barrel
* Spot gold fell 1.5% to $2,746.77 an ounce

This story was produced with the assistance of Bloomberg Automation.
–With assistance from Robert Brand.
Have a lovely evening .

Be magnificent!
As ever,

Carolann
Live as if you were to die tomorrow.  Learn as if you were to live forever. -Mahatma Gandhi, 1869-1948.

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 (Text Only)
Toll Free: 1.877.430.5895
Fax: 778.430.5828
www.carolannsteinhoff.com