August 21, 2019

Markets were up on Wednesday with the S&P 500 up 0.8% and Toronto up 0.6%.

Shopify was up another 4.0%.

Lululemon was up 2.0%,

Toll Brothers fell 4.5% despite reporting Q3 earnings that beat expectations. They also increased their full year guidance modestly and indicated they have increased their home prices in about half of their communities. Q3 earnings and sales were down versus last year but that was expected. Listening to the conference call and looking at the numbers my sense was that the decline of recent quarters is now leveling off. The stock apparently declined due to some concern about lower sales in California. Possibly, the stock will recover a bit when the analysts have updated their reports based on today’s conference call. Or not.

In Alberta, the news is that the Trans Mountain pipeline construction will resume in about 30 days. Hopefully this will provide some boost in employment and confidence for Alberta.

Rate reset preferred shares fell again today despite a large increase in the five year Canada bond yield (which was due to the 2.0% inflation which lowered expectations for Bank of Canada interest rate cuts). Perhaps rate reset preferred share owners are reaching capitulation. Selling even when rate rose as they have been so badly burned over and over. Possibly selling at the bottom? Showing the courage of my convictions I added a bit to my ENB.PF.A position today.