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The Week of February 10th to February 16th, 2014 “A Brief Look Back Into Tomorrow”

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The Week of February 10th to February 16th, 2014 “A Brief Look Back Into Tomorrow”







The new trading week begins with investors eager to see if the previous week’s modest gains would prove to be the bottom of a painful three week correction and perhaps the start of the next bull market, while resource followers were encouraged as more and more issues were establishing uptrends.




Monday, February 10th started with another senior mining company forcing its intentions on a junior with high quality assets as HudBay Minerals Inc. (HBM-T) made a hostile $540-million all-stock takeover offer to Augusta Resource Co. (AZC-T) and its prized Rosemont copper project in Arizona.




Meanwhile, in the forest sector, International Forest Products (IFP.A-T) spent $180-million to acquire Tolleson Ilim Lumber and move up into the ranks of the top five North American lumber producers.




The share price of Supertex Inc. (SUPX-Q) surged up by over 35% to US$32.96 when the semiconductor electronics company received a US$ 394-million all-cash takeover offer from larger Microchip Tech Inc. (MCHP-Q).




Statistics Canada reported that the value of the country’s building permits fell by 3.7% in January to an annualized 180,248-units.




And what Google Inc. (GOOG-Q) shares trading at over US$1,200 mean. It means that the value of the giant search engine company has surpassed Exxon Mobil Corp. (XON-N) as the second largest U.S. company and behind Apple Inc. (AAPL-Q) as the nation’s largest company.




Tuesday, March 11th was once again a day for the politicians to take centre stage first new U.S. Federal Reserve (Fed) Chairman Janet Yellen told her nation that the Fed would continue it gradual tapering  program but was prepared to react otherwise as the market dictated. Then Canadian Finance Minister Jim Flaherty presented a conservative budget to Canadians and referenced that the federal books may be in surplus by next year.




Gold mining shares seemed to move up in unison as the price of the yellow metal firmed by over $15 to approach US$ 1,290 in what many long suffering investors hoped would be a breakout pattern. (Could US$1,300 be on the horizon?)




Crude oil once again caught investor attention on Wednesday, February 13th, as the price of the black gold rose by $0.31 to rise above $100-a-barrel for the first time in four months and end the day at US$100.15-a-barrel.




Air Canada (AC.B-T) shares’ fell by almost 20% to $6.28 when the nation’s flag carrier reported that the recent drop of the value of the Canadian dollar was one of the causes for a less than expected 4th quarter report.




Thursday, February 13th began with word that Comcast Corp. (CMCSA-Q) had agreed to acquire fellow giant Time Warner Cable (TWC-N) in an US$42.5-billion all-stock deal that would create America’s largest cablevision provider.




Similarly, Bauer Performance Sports (BAU-T) purchased Easton Baseball/Softball from parent Easton-Bell Sports in an US$330-million all-cash transaction.




Bombardier Inc. (BBD.B-T) shares’ were once again pushed lower when the beleaguered Canadian plane/train builder disappointed the street with its 3rd-quarter financials and worse yet, provided a lower guidance for the upcoming year.




The shareholders’ of Cardiome Pharma (COM-T) were pleased to see their investment surge up by over 22% to $11.00 when the cardiovascular drug development company received a positive data report for its BRINAVESS drug that helps post surgery in returning heart rates to normal.




Those Canadian Baby Boomers heading apprehensively towards retirement gave a small sigh of relief on Friday, February 14th when Canada Pension Plan Investment Board announced its assets rose by 5.9% in the fiscal 3rd quarter to a record $201..5-billion.




Competition in the menswear business got even more intense when Joseph A. Bank Clothiers (JOSB-Q), already involved in a takeover battle with rival Men’s Wearhouse Inc. (MW-N), announced it was taking over Eddie Bauer in a cash & stock deal worth some US$825-million.




The American airline industry has definitely had enough of the 2014 winter as Associated Press reported that a 25-year high 75,000 domestic flights had been cancelled since the first of December.




With what mirrored a crash diet, the share price of Weight Watchers Int’l. (WTW-N) plunged by 27.5% to US$ 22.16 when the dietary company forecast a full-year forward guidance that was well below the streets’ expectations.




Gold bullion follows crude oil higher by gaining $15.60 to firmly cross above US$1,300 to end the day at 3-month high of US$1,318.40-an-ounce.




This helped the TSX Composite Index to rise by 53-points to once again move above 14,000 and close at a new 2¾ -year high of 14,055.




This was followed by the lowly TSX Venture Exchange gaining 10-points to end the day at a new 10-month high of 997.




And not to be outdone, the NASDAQ Exchange rose by 3-points to close at a new 14-year high of 4,244.




Augusta Resource Co. (AZC-T) at 3.52, Finning International (FTT-T) at $28.59 and Franco-Nevada Corp. (FNV-T) at $55.88, all established new 52-week trading highs last week, while Bombadier Inc. (BBD.B-T) at $3.44, Madison Pacific Properties (MPC-T) at $2.06 and Pacific Rubiales Energy (PRE-T) at $15.32 all fell to new 52-week lows.




For the Week – The Dow Industrials gained another 2,30% to 16,154, with the S&P 500 Index up by 2.33% to 1,848 and the NASDAQ Exchange up on the week by 2.86% to 4,244.

To the bring on Olympic Hockey north, the TSX Composite Index rose by 1.95% to 14,055 while the TSX Venture Exchange gained an impressive 3.56% to end the week at 997.




Gold bullion gained 4.06% to US$1,318 while copper rose by 0.62% to US$3.26. Meanwhile, Crude oil rose by 0.6% to US$100.10 and natural gas lost 4.81% to US$4.55. Overall, the CRB Commodities Index improved by another 3.47-points to end the week at new 5½-month high of 293.88.




The Canadian dollar rose by 0.50% to finish the week at US$0.9102.




And the closely watched CBOE Volatility Index (VIX) eased by 1.22-points to a calmer level of 13.57.




And Finally – Under our continuing heading of ‘Bad News – Good News’ – The bad new according to Equifax Canada is that the country’s collective household debt level rose by another 4.5% in the 4th quarter to a record $1.422-trillion. The good news is that the number of Canadians who are in arrears by over three months on their debt payments fell by 0.07% to 1.12%. (And isn’t modern economics just a wonderful thing?)



Posted February 18, 2014

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