December 5th, 2013 Business Update

A sell-off in Japan overnight as the Asian market caught up with the US.  China in contrast was off just 0.20%.

In Europe at midday markets are flat on no changes in from the ECB as Mario Draghi held his monthly press conference.  There has been some inflation pick-up and reduction in unemployment causing pause in any changes.

In the US the Initial Weekly Jobless Claims were released and declined 23000 from last week to 298000.  Also, Q3 GDP has been revised to 3.6% up from 2.8% and estimated at 3.1%.  Some solid economic numbers leading into the Non-Farm Payrolls tomorrow morning.  Markets are slightly higher.

Canadian futures are trading lower on bank earnings this morning.  Both RBC and CIBC beat on the bottom lines while TD missed.  Revenue was strong at all three however CIBC missed on the top line.  RBC announced that CEO Gord Nixon will be stepping down next fall, which is a little early for a bank CEO in Canada.  TD is splitting 2-1 and increased the dividend by a penny.  CIBC had some one time charges that caused weakness in the quarter.

Gold continues the downward trend off 23.00 to 1224, oil is up a nickel to 97.26 and the loonie is stronger this morning up 0.11 to 93.79.  US and Canadian 10 year bonds are trading a little lower this morning yielding 2.86% and 2.67% respectively.

Lastly, I have added another interesting piece from the Pimco Conference that I attended a couple of weeks ago.  The income story is an important one to most of my clients and most Canadians.  With low real interest rates and it would seem the rise in rates to come, one of the biggest dilemmas currently is how to invest in the asset class while preserving capital and generating a reasonable amount of income.  The article speaks of how Pimco sees the next year and what they do to try and provide a reasonable solution.

Kenneth A. Dick, BA, CIM, CFP, FCSI

Branch Manager & Portfolio Manager | Independent Wealth Management

Canaccord Genuity Wealth Management

www.glwm.ca

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