September 5, 2024, Newsletter

Dear Friends,

Tangents: Happy Friday Eve!

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 >>
September 5, 1998: Google is founded by Larry Page and Sergey Brinn while they are both students at Stanford University.

Russian watchmaker upends race to design world’s thinnest wristwatch
Luxury giants are locked in a heated battle to design the world’s thinnest mechanical watch. But an independent Russian watchmaker and inventor may have trumped them all.

Asteroid burns up in Earth’s atmosphere over the Philippines
Sky-gazers saw an asteroid burn up in Earth’s atmosphere over the Philippines near Luzon Island on Wednesday. See a photo here.

Chipotle launches Halloween costume collection
The fast-casual chain created a costume collection featuring a napkin, fork, water cup and a burrito. Or in this case, you can say you’re a boo-rrito.

Mysterious ‘mustached’ burial mounds in Kazakhstan date to the Middle Ages
Archaeologists in Kazakhstan have discovered 10 kurgans, or burial mounds, dating to the Middle Ages, and some have “mustaches.” Read More.

Boat-ramming orcas may be using yachts as target practice toys, scientists suggest
Orcas off the coasts of Spain and Portugal may be using boats as targets to practice hunting their favorite food, Atlantic bluefin tuna. Read More.

Specialist ‘carbon nanotube’ AI chip built by Chinese scientists is 1st of its kind and ‘1,700 times more efficient’ than Google’s
Scientists in China have developed a tensor processing unit (TPU) that uses carbon-based transistors instead of silicon – and they say it’s extremely energy efficient. Read More.

PHOTOS OF THE DAY

Paris, France
A visitor takes a picture of Leda, by Michele di Ridolfo del Ghirlandaio, on display at the Musée Jacquemart-André. The exhibition of masterpieces from Rome’s Galleria Borghese runs until 5 January
Photograph: Mohammed Badra/EPA

A view of the pool-type iceberg
Photograph: Anadolu/Getty Images

​​​​​​​Derry, UK
‘American street artist Jeks working on his mural of Amelia Earhart.’
Photograph: Mickey Rooney
Market Closes for September 5^th, 2024

International Markets

Bonds

Currencies

Commodities

Market Commentary:
📈 On this day in 1990: Developer Minoru Isutani bought the Pebble Beach golf resort for $841 million, in what was the latest high-profile Japanese purchase of a U.S. property. By early 1992, Isutani was on the verge of bankruptcy and sold Pebble Beach for $500 million.
Canada
By Bloomberg Automation
(Bloomberg) — The S&P/TSX Composite fell for the third day, dropping 0.2%, or 52.48 to 22,988.28 in Toronto.
The index dropped to the lowest closing level since Aug. 14.
Suncor Energy Inc. contributed the most to the index decline, decreasing 2.2%.
First Majestic Silver Corp. had the largest drop, falling 8.1%.
Today, 120 of 226 shares fell, while 97 rose; 5 of 11 sectors were lower, led by energy stocks.
Insights
* This year, the index rose 9.7%, heading for the best year since 2021
* This quarter, the index rose 5.1%
* So far this week, the index fell 1.5%, heading for the biggest decline since the week ended Aug. 2
* The index advanced 13% in the past 52 weeks. The MSCI AC Americas Index gained 22% in the same period
* The S&P/TSX Composite is 1.8% below its 52-week high on Aug. 26, 2024 and 23% above its low on Oct. 27, 2023
* The S&P/TSX Composite is down 0.6% in the past 5 days and rose 3.4% in the past 30 days
* S&P/TSX Composite is trading at a price-to-earnings ratio of 18.4 on a trailing basis and 15.8 times estimated earnings of its members for the coming year
* The index’s dividend yield is 3% on a trailing 12-month basis
* S&P/TSX Composite’s members have a total market capitalization of C$3.66t
* 30-day price volatility fell to 14.11% compared with 14.30% in the previous session and the average of 14.31% over the past month
================================================================
| Index Points | |
Sector Name | Move | % Change | Adv/Dec
================================================================
Energy | -30.8758| -0.8| 14/25
Industrials | -24.8831| -0.8| 6/21
Information Technology | -16.6950| -0.9| 3/7
Consumer Discretionary | -13.3687| -1.7| 4/9
Real Estate | -2.4814| -0.5| 3/15
Health Care | 0.1668| 0.3| 3/1
Utilities | 2.7928| 0.3| 9/6
Communication Services | 5.5639| 0.8| 5/0
Consumer Staples | 7.4388| 0.8| 7/4
Materials | 8.6587| 0.3| 35/13
Financials | 11.2125| 0.2| 8/19
================================================================
| | |Volume VS| YTD
|Index Points| | 20D AVG | Change
Top Contributors | Move |% Change | (%) | (%)
================================================================
Suncor | -10.2400| -2.2| 64.0| 20.9
Constellation Software | -9.4610| -1.6| 59.9| 27.3
RBC | -8.7980| -0.5| -41.3| 22.5
Couche-Tard | 4.9790| 1.3| 22.2| -3.4
CIBC | 7.2740| 1.4| 14.2| 26.5
TD Bank | 22.6600| 2.3| 70.6| -4.5
US
By Rita Nazareth
(Bloomberg) — Stocks got hit ahead of US jobs data that will be key in determining the size of a Federal Reserve rate cut in September.
In a session of several twists and turns, the S&P 500 finished lower.
That’s despite a rally in a handful of big techs.
Treasury yields fell slightly, with traders still pricing in over 100 basis points in Fed easing this year — which implies a potential super-sized reduction.
Given Jerome Powell’s recent emphasis on the labor market, many on Wall Street say Friday’s US payrolls will dictate whether the Fed cuts by 25 or 50 basis points this month.
To Steve Sosnick at Interactive Brokers, a “Goldilocks” scenario around consensus – ‘not too hot, not too cold’ – is what equity bulls require.
“The danger in really ‘bad news’ is that even if the Fed is prepared to react aggressively, it might be too late to stave off real economic weakness,” he said. “But there is a worry that if the news is ‘too good,’ the Fed might be reticent to cut rates as fast as the market has come to expect.”
In the run-up to the figures, economic data was mixed.
US services expanded at a modest pace, companies added the fewest jobs since the start of 2021, while unemployment claims trailed estimates.
“After today’s mixed numbers, it’s up to tomorrow’s jobs report to give investors a clearer read on the state of the labor market,” said Chris Larkin at E*TRADE from Morgan Stanley.
“Markets are still trying to figure out if the economy is slowing too much, and whether the Fed is behind the curve.”
The S&P 500 closed around 5,500. The Bloomberg “Magnificent Seven” gauge of mega caps rose 1.6%.
The Russell 2000 of small firms fell 0.6%.
Treasury 10-year yields slid three basis points to 3.72%.
The dollar slipped.
Among corporate highlights, Nvidia Corp. climbed, with Bank of America Corp. analysts saying the recent plunge has created an “enhanced” buying opportunity.
Tesla Inc. jumped on plans to launch the driver assistant in China and Europe.
Following a disappointing jobs report last month, it’s no wonder that investors are “skittish” ahead of Friday’s data, according to Bret Kenwell at eToro.
“While the odds currently favor a 25 basis-point cut at the Fed’s September meeting, a woefully disappointing jobs report could shift those odds to favor a 50 basis-point cut,” he said.
“If the Fed feels forced to go right to a 50 basis-point cut, it may suggest there’s a bigger worry about the jobs market than previously acknowledged.”
Kenwell says that ideally, we should see a “better-than-feared” report on Friday, showcasing a labor market that has softened a bit — but isn’t weak — and allows the Fed to usher in a series of 25 basis-point rate cuts.
To Andrew Brenner at NatAlliance Securities, if the economy shows strength in nonfarm payrolls, equities should do better initially — but if rates “get slaughtered,” that won’t be good.
Conversely, if rates rally because of a weak number, that won’t be good for stocks either.
“So we are in a tails we lose, heads we lose,” Brenner concluded.
The jobs report is expected to show payrolls increased by about 165,000, based on the median estimate in a Bloomberg survey of economists.
While above the modest 114,000 gain in July, average growth over the most recent three months would ease to a little more than 150,000 — the smallest since the start of 2021.
A survey conducted by 22V Research shows most investors (44%) think the market reaction to Friday’s data will be “risk- on,” 27% said “risk-off” and 29% “negligible/mixed.”
The tally also underscored a notable shift — with the unemployment rate gaining more attention this month.
Meantime, the focus on wage growth has dropped further.
And 52% of respondents expect payrolls to beat the 165,000 projection.
To Stan Shipley at Evercore, Thursday’s ADP private employment tally and other labor-market metrics suggest a “soft payroll” for August.
“Tomorrow’s payroll report could be softer than expected given the slowdown in ADP estimates” said Jeffrey Roach at LPL Financial.
“If the payroll report surprises investors and comes in weaker than expected, the likelihood of a 50 basis-point cut increases at the upcoming Fed meeting.”
While the ADP report has been a poor prognosticator of non-farm payrolls in recent years, its correlation to the print has been improving this year.
To Dan Wantrobski at Janney Montgomery Scott, there are multiple technical gauges that are flashing warning signs.
That’s why he remains in “defensive mode,” anticipating further volatility ahead for stocks as we move through the September-October window.
“Both the S&P 500 and Nasdaq 100 are pressing further into oversold territory on a short-term basis, which implies they are coiled springs in the event that trading sentiment reverses sharply,” he said. “Tomorrow’s employment data could be a trigger for such a counter-trend move in our opinion. Would it be enough to completely negate the corrective cycle we currently find ourselves in? Most likely not.”

Corporate Highlights:
* JetBlue Airways Corp. raised its sales forecast for the current quarter after the carrier said it benefited from re-booking passengers from rival airlines whose flights were disrupted by a technology outage in July.
* C3.ai Inc., a data analysis software company, reported quarterly subscription revenue that missed estimates.
* Hewlett Packard Enterprise Co. reported weaker-than-expected margins, suggesting lower profitability than anticipated in its closely watched business of selling servers for artificial intelligence work.
* Verizon Communications Inc., which agreed to buy Frontier Communications Parent Inc. for about $9.59 billion in cash, said it’s focused on paying down debt as it works on closing the deal.
* Paramount Global, the parent of CBS, will be controlled by software billionaire Larry Ellison after a group led by his son David completes its purchase of the Redstone family’s interest in the film and TV company, according to a regulatory filing.

Key events this week:
* Eurozone GDP, Friday
* US nonfarm payrolls, Friday
* Fed’s John Williams speaks, Friday

Some of the main moves in markets:
Stocks
* The S&P 500 fell 0.3% as of 4 p.m. New York time
* The Nasdaq 100 was little changed
* The Dow Jones Industrial Average fell 0.5%
* The MSCI World Index fell 0.3%
* Bloomberg Magnificent 7 Total Return Index rose 1.6%
* The Russell 2000 Index fell 0.6%
Currencies
* The Bloomberg Dollar Spot Index fell 0.2%
* The euro rose 0.2% to $1.1105
* The British pound rose 0.2% to $1.3171
* The Japanese yen rose 0.2% to 143.45 per dollar
Cryptocurrencies
* Bitcoin fell 3.4% to $56,090.69
* Ether fell 3.6% to $2,365.8
Bonds
* The yield on 10-year Treasuries declined three basis points to 3.73%
* Germany’s 10-year yield declined two basis points to 2.21%
* Britain’s 10-year yield declined two basis points to 3.91%
Commodities
* West Texas Intermediate crude was little changed
* Spot gold rose 0.8% to $2,515.75 an ounce

This story was produced with the assistance of Bloomberg Automation.

Have a lovely evening.

Be magnificent!
As ever,

Carolann
If people are  not laughing at your goals, your goals are too small. -Azim Premji, b. 1945.

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