November 15th, 2013 Business & Market Update

A solid overnight session in Asia as markets there reacted to the Yellen comments, the reforms in China that will promote internal growth and the Yen falling bolstering the Japanese market.  China was up about 1.5% and Japan was stronger by almost 2%.

Europe is essentially flat on a broad basis as markets there continue to battle the slow pace of recovery.

US and Canadian markets after a strong rally into the close on Yellen’s comments are looking to open higher this morning by about a quarter point.  Mrs. Yellen the heir apparent to replace Ben Bernanke, effectively held the dovish line yesterday indicating that there was no reason to move on tapering just yet.  This quote tells the story, “It’s important not to remove support, especially when the recovery is fragile and tools available to monetary policy, should the economy falter, are limited given that short-term interest rates are at zero”.

Gold is flat this morning at 1286, oil is higher again today after a rally yesterday up 0.27 to 94.69 and the loonie is flat at 95.55.  US and Canadian 10 year bonds after a rally into the news yesterday are flat this morning yielding 2.70% and 2.57% respectively.

Lastly, the Oracle of Omaha, Warren Buffett has made a big move indicating that he has taken a big position in Exxon and sold a good portion of his stake in Conoco Oil.  On the negative side however, with the purchase of Heinz earlier this year, the company has decided to close the Leamington, ON plant which will cost the small town some 700 jobs.  For as good as consolidation is, the down side is some do suffer in the process.  Hopefully they can all find alternative employment.

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

Branch Manager & Portfolio Manager | Independent Wealth Management

Canaccord Genuity Wealth Management

September 16th 2013 Business & Market Update

Over the weekend the Syria crisis calmed as the Russians and Americans came to agreement on the rules of engagement in regard to removing the chemical weapons from Syria.  Of course the West is skeptical, however, the aversion of war is a positive one for all involved.

Asia overnight was up marginally on the news.

Europe has moved higher by a point on the news and the fact that Lawrence Summers, the leading replacement for Fed chairman Ben Bernanke has dropped out of the race, leaving the door open for Janet Yellen.  Summers is a proclaimed “hawk” calling for the end of QE and a faster line to increasing interest rates.  Yellen on the other hand is a so called “dove” promoting a more gradual change to monetary policy.  US futures are trending higher on this news up about 1.25%.  The US dollar on the other hand is falling on he news.

Canadian futures are stronger by about a third of a point.

Gold is up 4 bucks to 1312 on the weaker dollar, oil is off on the Syrian news 1.45 to 104.51 and the loonie is stronger by half a cent to 97.15.  The US and Canadian 10 year bonds are rallying on the news this morning with yields falling to 2.79% and 2.69% respectively.

After many delays over the last year, Bombardier is today finally going to test fly the new C-Series jet.  The much anticipated flight should pave the way, if successful, to a strong order book for the mid-distance commuter jet.

Tomorrow and Wednesday the Fed meets to discuss monetary policy with the big decision being to taper now or wait until they meet again in November.  The street is 50/50 on the decision, however it is my view that the tapering decision has already been factored into both the debt and equity markets as it is inevitable to occur.

We are also watching with great interest the debt ceiling deadline that is coming at the end of the month.  The ceiling must be raised again and while it will be done the issue will be can they (the US Congress) get it done efficiently and expediently?  We shall see.

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

Branch Manager & Portfolio Manager | Independent Wealth Management

Canaccord Genuity Wealth Management