October 22nd, 2013 Business / Market Update

Overnight in Asia, markets were fairly quiet, despite a big increase last month in Chinese home prices.  The biggest in three years which has some wondering how inflationary this may be and will the PBOC respond.

In Europe, markets are higher by about a half of a point on the jobs news out of the US.  The monthly Non-Farm Payrolls for September were finally released this morning and the number was far below estimates coming in at 148000 vs. 180000 estimated.  The unemployment rate fell to 7.2% from 7.3% on the participation rate falling.  However, the news was not all bad as August was revised higher by 24000 to 193000.  Bottom line growth is occurring however until Washington gets its act together many companies will not actively hire.  Some form of tax reform must take place to assure companies that hiring and expending capital into bricks and mortar will be rewarded down the road.    US futures are higher by a quarter point this morning on the news.

Gold is up 14.00 to 1328 on a weaker US dollar, oil is off another 0.27 to 98.95 and the loonie is flat at 97.04.  The US and Canadian 10 year bonds continue to strengthen this morning as yields are 2.54% and 2.50% respectively.

In mandate earnings news, Lockheed-Martin beat on both earnings and revenues and indicated higher guidance for the balance of the fiscal year.  Whirlpool also beat on both earnings and revenues but cautioned on the balance of the year.  Both stocks are set to open higher this morning.  After the market close CN Rail will report,  I will provide the details tomorrow.

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

Branch Manager & Portfolio Manager | Independent Wealth Management

Canaccord Genuity Wealth Management

www.glwm.ca

September 24th, 2013 Business and Market Update

A quiet overnight in Asia as markets there were weaker by about a quarter point.  China PMI was a stronger yesterday which caused markets to rally initially and profit taking then took over as markets sold off into the close.

In Europe, we are seeing gains with markets up about a half a point mostly on Merkle’s re-election and stronger business confidence numbers out of Germany.  Merkle however did not get a majority (5 seats short) and will have to form a coalition government to get legislation passed which is cause for some concern as the big economy continues to recover.

In the US we are seeing unchanged futures this morning as the focus is on the debt ceiling that must be ratified by the 30th of the month.  The new limit that will take the country through to the end of next year will need to raise from the current $16.7tr level.  Of course both sides of the aisle are at odds on how to limit the cumulative debt.  I am confident a deal will be struck adding a trillion to the current number.  The Case Shiller July Housing numbers were released this morning and were bang on estimates at 12.4% year over year.  Stable is the word I would use to describe sector currently.

TSX 60 futures are a little lower this morning following the US lead.  Of course the big news out of Canada is the bid of $9.00 per share from Fairfax Financial Holdings for Blackberry.  Yes the smart phone maker actually has a bid that has been ratified by the board.  Prem Watsa the CEO of Fairfax and a board member of BB up until the end of last month has a 10% ownership stake in BB.  The bid is smart on many fronts the most important of which is it puts a floor on the shares.  It starts a bidding war (not that I think it will a big fight) but many analysts have already stated that the parts are worth more.  The other thing the bid does is take the company private, which does take an incredible amount of public heat off the stock and may buy the company some time to regroup.  At the end of the day, no matter how it is sliced up, it is a shame this great Canadian story will end with whimper like a few recent others before it.

Gold is down 15.00 to 1312, oil is off 0.67 to 102.05 and the loonie is off slightly to 97.17.  The US and Canadian 10 year bonds are stronger this morning with yields falling to 2.69% and 2.61% respectively.

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

Branch Manager & Portfolio Manager | Independent Wealth Management

Canaccord Genuity Wealth Management

www.glwm.ca

September 4th, 2013 Business & Market Update

A good day yesterday, with a grain of salt.

It looks like some action will occur in the middle east if the US congress votes favorably.  With that said, the Russians, Iran and China are not on board and how the other mid-east countries react is still a big question.  With all that said a war will cause volatility.

Asia was stronger overnight on the back of the US move higher.  Europe is off at midday by about a point on continued fears of war in the middle east.

US futures are lower by about a quarter point and Canadian futures are showing the same decline.

Gold is off $20.00 this morning to 1393.  The commodity is very fickle at the moment with a number of factors affecting it.  The commodity started to move higher on the war threat and then slammed into the 200 day moving average and has bounded off that and retreated.  The trend is down – until there is some hint of inflation.  Oil is off over a point this morning to 107.36, the loonie is up 20 bps to 95.12 and the US and Canada 10 years bonds are flat at 2.86 and 2.68 respectively.

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

Branch Manager & Portfolio Manager | Independent Wealth Management

Canaccord Genuity Wealth Management

www.glwm.ca

August 29th, 2013 Business and Market Update

A bit of a rally yesterday as many went bargain hunting as the day progressed.  Of course the threat of war in the middle east is hovering over markets and as we go into the long weekend caution will be the word for all.

In Asia overnight, markets rallied on the North American rise by about a point.  Euro markets are showing gains at midday of about a quarter point.

In North America, the US futures are pointing higher this morning by about a quarter point on higher Q2 GDP of 2.5% vs. 2.2% estimated.  Also the Weekly Jobless Claims came 6000 less than last week at 331000 which was also better than estimates of 339000.  With the housing rally in the US stalled, the GDP and employment numbers are promising.

Gold is off this morning by  7.00 to 1410, oil is lower by 0.50 to 109.56 on no new news out of the middle east, the loonie is lower by 18 bps to 95.15 and the 10 year yields are up in both Canada and the US to 2.67% and 2.82% respectively.

The last of the three big banks reported this morning and all beat estimates on earnings and matched revenue expectations.  Both TD and RBC increased dividends while CIBC will buy back up to 8 million shares over the coming year.  All suggested that margin compression will continue through the balance of fiscal 2013 and 2014 and there has been some slowdown mortgage applications in the last quarter.  The profit beat from all came from the wealth management divisions with an average increase of more than 15%.  Wholesale, retail and capital markets saw an average decrease of 10%.  In all, reasonable reports for the banking oligopoly.

Lastly, Verizon is making a bid for 45% of Vodaphone the big Euro cell company which will provide a solid position in that market.  It also suggests that Verizon may have shelved its Canadian plans for the time being, which in turn should help the Telco’s here in Canada.

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

Branch Manager & Portfolio Manager | Independent Wealth Management

Canaccord Genuity Wealth Management

www.glwm.ca

August 27th, 2013 Business & Market Update

Some good news out of Europe this morning as German Manufacturing increased to the highest level in 16 months indicating that the economy in the region is continuing to improve.  However the systemic risk of the Syrian crisis is front and centre today as all of the West and many other nations are continuing to make accusations as to the use of chemical weapons and with the accusations threats of retaliation from the US, the UK and NATO en masse have been causing markets world wide to fall

Asia was off about three quarters of a point overnight, Euro markets are down about 1.5% US futures are off about a point and Canada is down about a third of a point.

Oil has rallied on the news up over $2.00 to 108.01 which is what is causing the Canadian markets to see moderate losses only. Gold is also rallying on the news up over 26.00 to 1419 as are bonds with money moving back into the safe haven of US Treasuries.  The loonie is down a quarter cent to 94.94.

Both BMO and BNS came with earnings this morning and both beat estimates and matched, for the most part, on revenues.  BMO’s numbers were interesting and I would suggest the beat was not as big as indicated mostly due to the loan loss provisions that were hard to determine for the quarter.  Unlike BNS, BMO did not increase their dividend.  In all a respectable quarter from both institutions however caution remains going forward.

Lastly, home ownership in Canada continues to be a priority for most however ownership continues to be difficult for many as prices are putting many out of the market.  RBC released a report yesterday that suggests many have been priced out of the market and are concerned with the level of debt that they need to take on to purchase a home.  This in my view is a positive development and over time will cause a correction in prices as demand continues to decline to more moderate levels.  Many are starting to realize that while mortgage rates are low and accessible that same dynamic is what continues to push prices higher. Also, the Case Shiller US home price index rose 12.1% year over year through the end of July, which confirms the continued recovery in the US housing market.

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

Branch Manager & Portfolio Manager | Independent Wealth Management

Canaccord Genuity Wealth Management

www.glwm.ca

July 29th, 2013 Business & Market Update

A very busy week this week as the earnings reports continue to come at a fast pace, the FOMC meets again Tuesday and Wed with a statement set for release on Wed afternoon and Friday we get the July Employment numbers our of the US.

Overnight in Asia, the Yen was once again stronger and more concern over a slowing Chinese economy caused Japan to drop 3.5% and China 1.75%.

Europe however is higher at midday as Italy has started to recover at a faster pace and should see positive GDP in fiscal 2014.  Markets are trading higher by about a third of a point.

US futures are down about a fifth of a point on no real news as markets wait for the Fed and the employment number later in the week.  Canadian futures are flat this morning.

Gold is trading higher on the weaker dollar this morning up 10.00 to 1337.00, oil is higher by 38 cents to 105.09 and the loonie is flat at 97.33.

On the earnings front, mandate companies, Arc Resources, Air Castle and Eastman Chemical are all announcing results after the market closes this evening.  I will provide the results in tomorrows blog.

A couple of big Canadian companies are in the news today.  The US President stated this weekend that the job creation numbers that have been estimated for the creation and servicing of the Keystone Pipeline project will be about a tenth of what was originally estimated.  Where he got the numbers from has not been divulged, however I am sure there will be much more on this in the days to come.  TransCanada for their part has suggested that a $7.6bn project that spans the continental US would create and sustain more than 20000 jobs which they feel is a conservative estimate.

Lastly, the Hudson’s Bay Company today announced a deal to buy Saks the big US high end retailer for about $2.6bn.  The deal, while accretive is an expensive one for HBC and the financing is being done in a number of different ways through private investment, debt and equity.  The company also announced it will be reducing its dividend by about half to help pay for the deal.

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

Branch Manager & Portfolio Manager | Independent Wealth Management

Canaccord Genuity Wealth Management

www.glwm.ca

July 23rd 2013 Business & Market Update

Overnight the Chinese government reiterated the commitment to a 7% growth rate by providing the stimulus necessary to continue to achieve the goal.  Market in Asia on the news were up with China leading the way up more than 2%.  Japan advanced by about a point.  Australia which does a great amount of trade with China was up about a third of a point.

Europe was also higher on the news as a big trading partner.  Markets in the region were up about a half a point at midday.

In North America,  we are seeing some upside this morning on the China news and further positive earnings reports.  Both US and Canadian futures are up about a quarter point.

Mandate company, Canadian National Railways reported after the close yesterday and beat estimates on both revenue and earnings.  They did however warn of a challenging second half of the year.

Also, Canadian retail sales were released for May and beat estimates by a large margin coming in at 1.9% vs. 0.4% estimated.

Gold is trading down about 7.00 this morning to 1330, oil is off 1.00 to 105.98 and the loonie is up a quarter cent to 96.97.

Lastly, as I am sure all must know by now, the new royal was born yesterday afternoon.  A bouncing baby prince.  Name to be determined, I am betting on James.

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

Branch Manager & Portfolio Manager | Independent Wealth Management

Canaccord Genuity Wealth Management

www.canaccord.com