September 5, 2023, Newsletter

Dear Friends,

Tangents:
September5th, 1984: Western Australia becomes the last Australian state to abolish capital punishment.
On Sept. 5, 1972, Palestinian terrorists attacked the Israeli Olympic team at the summer games in Munich; 11 Israeli athletes and coaches, five terrorists and a police officer were killed.  Go to article >>

Fall movie preview: Rom-coms, horror flicks, trolls and Taylor Swift:  Movie buffs, mark your calendars. Here are the notable theatrical releases between this month and Thanksgiving.

Greece starts limiting daily visitors to the Acropolis:  One of Greece’s most famous landmarks is limiting the number of daily visitors to tackle over-tourism.

Mississippi hunters capture longest alligator in state history:  This 800-pound behemoth measured over 14 feet long.

Global search underway for Paul McCartney’s missing violin bass:  A group of Beatles fans and researchers are trying to find Paul McCartney’s 1961 Höfner bass.

One of the world’s oldest synagogues reopens in Egypt:  Egypt has reopened one of the world’s oldest synagogues, home to the most significant single trove of Jewish manuscripts.

‘Doubly magic’ form of oxygen may challenge a fundamental law of physics
After scientists created oxygen-28 in the lab, it almost immediately degraded, baffling physicists around the world. Read More.

What are the most polluted cities in the world?
Cities like Lahore, Pakistan, Hotan, China and Delhi, India have consistently poor air quality, but it’s impossible to accurately identify the city with the world’s worst air pollution. Read More.

‘Twisty’ new theory of gravity says information can escape black holes after all
Einstein’s theory of relativity say black holes are ‘bald’, but a new tweak to his research may give the mysterious objects their long-sought ‘hair.’ Read More.

PHOTOS OF THE DAY

The sun rises over colourful houses in Totterdown as forecasters are predicting a ‘last dose of summer’, with warm spells reaching 30C on Tuesday in southern areas of England, and 32C on Wednesday and Thursday in central and southern England.  Photograph: Ben Birchall/PA.

Daytona Beach, US
A lifeguard warns swimmers as a seagull flies by in Florida Photograph: Paul Hennessy/SOPA Images/Shutterstock.

​​​​​​​Black Rock City, US
Vehicles are seen departing the Burning Man festival in Nevada.  Photograph: Matt Mills Mcknight/Reuters.
Market Closes for September 5^th, 2023

International Markets

Bonds

Currencies

Commodities

Market Commentary:
📈 On this day in 1927, Paul Volcker was born in Cape May, N.J.  As the tough-as-nails head of the Federal Reserve Board from 1979 through 1987, Volcker finally broke the back of inflation after a decade of pussyfooting by his predecessors.
Canada
By Bloomberg Automation
(Bloomberg) — The S&P/TSX Composite fell 0.6% at 20,413.76 in Toronto.
The move was the biggest since falling 1.9% on Aug. 15 and follows the previous session’s increase of 1.2%.
Brookfield Corp. contributed the most to the index decline, decreasing 2.2%.
First Quantum Minerals Ltd. had the largest drop, falling 5.9%.
Today, 154 of 226 shares fell, while 70 rose; 9 of 11 sectors were lower, led by materials stocks.
Insights
* This year, the index rose 5.3%, heading for the best year since 2021
* This quarter, the index rose 1.3%
* The index advanced 5.9% in the past 52 weeks. The MSCI AC Americas Index gained 14% in the same period
* The S&P/TSX Composite is 2.1% below its 52-week high on Feb. 2, 2023 and 14.2% above its low on Oct. 13, 2022
* The S&P/TSX Composite is up 1.9% in the past 5 days and rose 0.9% in the past 30 days
* S&P/TSX Composite is trading at a price-to-earnings ratio of 15.5 on a trailing basis and 14.7 times estimated earnings of its members for the coming year
* The index’s dividend yield is 3.3% on a trailing 12-month basis
* S&P/TSX Composite’s members have a total market capitalization of C$3.25t
* 30-day price volatility rose to 11.97% compared with 11.83% in the previous session and the average of 11.01% over the past month
================================================================
| Index Points | |
Sector Name | Move | % Change | Adv/Dec
================================================================
Materials | -46.0394| -1.9| 4/46
Financials | -42.6767| -0.7| 8/19
Industrials | -15.4299| -0.6| 14/12
Information Technology | -13.9697| -0.8| 1/10
Utilities | -9.2533| -1.1| 2/14
Communication Services | -8.3434| -1.1| 0/5
Consumer Discretionary | -6.2346| -0.8| 4/10
Consumer Staples | -1.4617| -0.2| 4/6
Real Estate | -1.2018| -0.2| 7/14
Health Care | 0.2955| 0.5| 1/3
Energy | 12.7140| 0.3| 25/15
================================================================
| | |Volume VS| YTD
|Index Points | | 20D AVG | Change
Top Contributors | Move | % Change | (%) | (%)
================================================================
Brookfield Corp | -10.3800| -2.2| -30.3| 8.4
First Quantum Minerals | -8.5640| -5.9| 58.6| 23.4
Canadian National | -8.3510| -1.3| 33.3| -5.6
Metro Inc | 1.4170| 1.2| -14.1| -4.8
Suncor Energy | 3.5770| 0.8| 36.6| 9.1
Canadian Natural Resources | 6.0670| 0.9| 120.4| 18.5
US
By Rita Nazareth
(Bloomberg) — Treasuries sank as a handful of companies flooded the market with billions of dollars in debt sales before this month’s key economic data and the Federal Reserve’s rate decision.
Stocks fell and the dollar hit the highest since March as a rally in oil added to concern about inflation.
Bonds were hit across the US curve, with 10-year yields approaching 4.3%.
At least 40 businesses tapped high-grade markets around the world Tuesday after a seasonal slowdown and the recent surge in Treasury rates.
“Investors are comfortable with the narrative that the bulk of the selling pressure was a function of an atypically heavy corporate issuance calendar as the market returns from vacation season,” said Ian Lyngen, head of US rates strategy at BMO Capital Markets. “We’re comfortable with this interpretation and will add that rate-lock unwinds will, presumably, be as supportive as their initiation was damaging to Treasuries.”
The S&P 500 ended below 4,500, an index of small caps slid about 2% and gauge of homebuilders sank 5.5%.
Energy and tech shares outperformed.

Fed Governor Christopher Waller said policymakers can afford to “proceed carefully” with tightening given recent data showing inflation continuing to ease.
“There is nothing that is saying we need to do anything imminent anytime soon,” Waller told CNBC. Meantime, Fed Bank of Cleveland President Loretta Mester said the central bank may need to raise rates “a bit higher,” but stopped short of saying what officials should do at their next meeting.
“The Fed is sailing in shallow waters in a thick fog,” said David Kelly, chief global strategist at J.P. Morgan Asset Management. “It should be moving very slowly and be ready to halt or reverse its monetary tightening.”
Goldman Sachs Group Inc. now sees a 15% chance the US will slide into recession, down from 20% previously as cooling inflation and a still-resilient labor market suggest the Fed may not need to raise interest rates any further.

To Chris Senyek at Wolfe Research, last week’s “bad news is good news” trading action was a sign that the market continues to strongly believe in the “disinflation” and “soft landing” narratives that have driven up stocks over the past six months.
“Unfortunately, our sense is that bulls aren’t going to be able to have their cake and eat it too,” Senyek noted. “We still expect stickier-than-expected inflation into a persistent price-wage spiral, higher oil prices, and housing market strength, and that the FOMC will hike in November and/or December.”
The worst month of the year for US equities is upon us, but a bevy of positive market signals suggest it may not be so bad this time around.
While seasonal trends place September in last place for stock market performance, returns have been most robust in times the S&P 500 gained between 10% and 20% year-to-date through August, according to Bank of America Corp. chief technical strategist Stephen Suttmeier.
Such an advance through August has preceded a market move higher in the last four months of the year 91% of the time, with an average jump of 7.6%.
If that trend holds up, the S&P 500 could rise to as high as 4,875 before 2023 closes out.
That would imply a gain of about 8% from Friday’s close.
JPMorgan Chase & Co.’s Marko Kolanovic reiterated Tuesday that investors should fade the artificial-intelligence induced stock-market rally, arguing that he would turn more optimistic on equities if interest rates begin falling globally in the near term.
Meantime, Morgan Stanley’s Michael Wilson said US equity investors are in for disappointment as economic growth is set to be weaker than expected this year.

Corporate Highlights:
* United Airlines Holdings Inc. dropped after a temporary grounding of its aircraft nationwide due to an unspecified equipment outage.
* Private equity giant Blackstone Inc. and vacation home-rental company Airbnb Inc. climbed on news they will be added to the S&P 500 this month.
* Oracle Corp. advanced after Barclays Plc upgraded the software company to overweight, calling it a “multi-year growth story.”
* Digital World Acquisition Corp., which is working to take Donald Trump’s nascent media company public, climbed after reports that the blank-check firm won investor approval to extend its deadline for another year, bolstering hopes the deal will be completed.
* Manchester United Plc sank after a report in the Mail On Sunday that said the Glazer family is going to take the club off the market after failing to receive offers that match their asking price.
* Arm Holdings Ltd.’s initial public offering, planning to raise $4.87 billion at the top of its range, shows the premium valuation the British chip designer was seeking from a New York listing may not fully materialize.
Key events this week:
* Eurozone retail sales, Wednesday
* Germany factory orders, Wednesday
* US trade, ISM services index, Wednesday
* Canada rate decision, Wednesday
* Bank of England Governor Andrew Bailey testifies to the UK parliament’s Treasury Select Committee, Wednesday
* Federal Reserve issues Beige Book economic survey, Wednesday
* Boston Fed President Susan Collins speaks, Wednesday
* Dallas Fed President Lorie Logan speaks, Wednesday
* China trade, forex reserves, Thursday
* Eurozone GDP, Thursday
* US initial jobless claims, Thursday
* Bank of Canada Governor Tiff Macklem to speak on the Economic Progress Report, Thursday
* Atlanta Fed President Raphael Bostic speaks, Thursday
* New York Fed President John Williams participates in moderated discussion at the Bloomberg Market Forum, Thursday
* Japan GDP, Friday
* Germany CPI, Friday
* US wholesale inventories, consumer credit, Friday

Some of the main moves in markets:
Stocks
* The S&P 500 fell 0.4% as of 4 p.m. New York time
* The Nasdaq 100 rose 0.1%
* The Dow Jones Industrial Average fell 0.6%
* The MSCI World index fell 0.6%
Currencies
* The Bloomberg Dollar Spot Index rose 0.7%
* The euro fell 0.7% to $1.0722
* The British pound fell 0.5% to $1.2562
* The Japanese yen fell 0.9% to 147.72 per dollar
Cryptocurrencies
* Bitcoin fell 0.6% to $25,683.51
* Ether rose 0.3% to $1,632.29
Bonds
* The yield on 10-year Treasuries advanced eight basis points to 4.26%
* Germany’s 10-year yield advanced three basis points to 2.61%
* Britain’s 10-year yield advanced six basis points to 4.53%
Commodities
* West Texas Intermediate crude rose 1.3% to $86.70 a barrel
* Gold futures fell 0.8% to $1,951.80 an ounce
This story was produced with the assistance of Bloomberg Automation.
–With assistance from Jason Scott, Tassia Sipahutar, Sujata Rao and Isabelle Lee.
Have a lovely evening.

Be magnificent!

As ever,

Carolann
Conditions are never perfect.  “Someday” is a disease that will take your dreams to the grave with you….
If it’s important to you and you want to do it “eventually”,
just do it and correct course along the way. –Tim Ferriss, b. 1977.

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