September markets perspectives

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  • 1. FINCOR – Sociedade Corretora, S.A.
  • 2. Monthly Perspectives September 3th, 2012 .Fincor- Sociedade Corretora, S.A. provides services of reception, execution, and transmission of orders. The contents mentioned in this document do notconstitute (nor should they be interpreted as to form) any kind of counseling, or investment recommendation, or a record of our trading prices, or anoffer or solicitation to trade in any financial instrument. Fincor- Sociedade Corretora, S.A. will not accept any responsibility resulting from any use referring tosaid content or about any resulting effect that could have occurred.
  • 3. August: Recap
  • 4. Greece – September will be crucial-Greece wants a 2 years delay to implement new austerity measures.- But Juncker, Merkel and Hollande said that a decision will only be taken after Troika’s visit in September. Allthey said if Greece wants to remain in the Eurozone they must accomplish the program designed to thecountry.
  • 5. Spain, what are you waiting for?-Fitch said the country will need more then the The pressure over the Banking Sector continues as€100B initially forecasted for its bailout. the Non-Performing Loans continues to increase.-And Catalonia asked for a €5B bailout. Valenciaincreased the amount asked from €3,5B to €4,5B.Just these two regions spent half of the €18Bcapacity of the Regional Rescue Fund.
  • 6. Spain, what are you waiting for?-Mariano Rajoy said that the country won’t need to raise taxes in 2013. As the economy is expected tocontract and with a target budget deficit of 6,3% for this year, is this situation sustainable?
  • 7. ECB, what is your next There is still disagreementstep? about the policies to take-There is a lots of talk in the markets saying that the Monti wants that the Bailout Funds of the Region toECB will define a limit to the yields of each country, gain a Banking Permission, something that Merkel isand if that value is exceeded they will intervene against.buying sovereign bonds.-Bundesbank opposed immediately to this, and German court will have an important word onPIMCO’s El-Erian also said this was a bad idea. September, 12.
  • 8. Europe-Economic data points to a contraction in the region. PMI Manufacturing Industrial Production65 4 360 255 1 Eurozone 050 Germany Germany -145 France Italy -2 -3 Italy40 France -4 UK35 UK -530 -6 Oct-06 Oct-07 Oct-08 Oct-09 Oct-10 Oct-11 Apr-06 Apr-07 Apr-08 Apr-09 Apr-10 Apr-11 Apr-12
  • 9. US – Closer than ever from QE3-Bernanke at Jackson Hole: “Unless the economy begins to grow more quickly than it is recently, theunemployment is likely to remain far above levels consistent with maximum employment”. US: Unemployment Rate 11 10 9 8,3 8 7 6 5 4-A previous study from the FED revealed that the natural rate for country’s unemployment is 6%. Statementsfrom several FED members points to incremental stimulus in the economy, how close to QE3?
  • 10. US – The economy seems recovering US: Housing Starts US: Building Permits1000 900 850900 811 800800 746 750700 700 650600 600500 550400 500
  • 11. US – The economy seems recovering U. Michigan Confidence US: Consumer Confidence85 8080 70 74,3 60,675 6070 5065 406055 3050 20
  • 12. US – The economy seems recovering US: Leading Indicators 2 1 0,4 0 -1 -2 -3 -4
  • 13. US – The economy seems recovering-But we should pay attention to the consistent manufacturing data that points to a possible slowdown US: Empire Manufacturing US: Philadelphia FED Index40 5030 40 3020 2010 10 0 0-10 -10 -5,85 -7,1 -20-20 -30-30 -40-40 -50 US: Dallas FED Index US: Richmond Fed Index 30 40 20 30 10 20 0 10-10 -1,6 0-20 -10-30 -9-40 -20-50 -30-60 -40-70 -50
  • 14. New highs on Apple and new lows on Facebook 700 40 680 660 35 640 620 30 600 Apple Price 580 25 Facebook Price 560 540 20 520 500 15-Samsung will pay a fine of $1,05B to Apple for violation of patents. The company faces the risk of beingforbidden to sell its products on the US.
  • 15. Emerging Markets China: PMI Manufacturing 58-Inflation in China fell to a of two years’ low, while 56manufacturing data continues to show a slowdownin the economy. 54 52-Brazil announced that will invest BRL133B in the 50,1 50next 25 years to develop roads, transports andrailway lines. The country cut SELIC from 8% to 7,5%. 48
  • 16. Portugal- BPI increased their capital in €200 million, by completing a rights offering of 400 million shares with asubscription price of €0,5 each.- Brisa successful tender from Tagus who now have over 85% of the company and 92% of its voting rights.-Banif presented a loss of €125 million during 1H12, due to economic recession in Portugal and the increaseof NPLs. This month BANIF will announce a capital increase with the support of the Portuguese Government.-Altri presented a profit of €15,85 million during the second quarter, beating all the analysts estimates.-Banif and Cofina will join PSI20 Index on September 24th, after Brisa and Cimpor left.-REN will launch in bonds €200 million, in a retail offering. It will have a maturity of 4 years and will pay acoupon of 6,25%.
  • 17. PerformanceThe markets had a positive performance in August, with a special regard to peripheral countries in Europe. Last Chg. % Chg. % Price MTD YTD Europe PSI 20 4998,86 6,63% -9,02% Last Price Chg. % Chg. % IBEX35 7420,5 10,13% -13,38% MTD YTD CAC 40 3413,07 3,69% 8,02% 10Y Bond Yields: Spread vs DAX 30 6970,79 2,93% 18,18% FOREX Euro/$ 1,2575 2,19% -2,98% FTSE 100 5711,48 1,35% 2,50% Germany FTSE MIB 15100,48 8,71% 0,07% £/Euro 1,2624 0,86% -5,05% Euro/Yen 98,46 -2,34% 1,22%6,5 SMI 6388,01 -0,18% 7,61% Eur/CHF 1,20081 0,03% 1,33% Euro Stoxx 50 2436 4,64% 8,90% 6 Commodities USA 5,523 CRB 491,13 1,80% 1,89%5,5 DOW 30 13103,61 0,73% 7,25% WTI Oil 96,88 9,67% -1,72% S&P500 1407,68 2,06% 11,93% 5 Brent Oil 114,7 10,46% 9,69% Spain Nasdaq 3066,314 4,31% 17,70% 4,513 Gold 1687,75 4,55% 7,93%4,5 Latin America Italy Bovespa 56996,67 1,60% 0,43% 4 Mexbol 39820,04 -2,17% 7,40%3,5 Asia Nikkei 225 8839,91 3,33% 4,55% Hang Seng 19482,57 -0,93% 5,69%
  • 18. September
  • 19. Europe-Troika returns to Greece on September 5th. Whatwill be the outcome?-Germany’s Constitutional Court takes a decisionabout ESM on September 12th.-Will the ECB advance with a Security MarketsProgram?-Results to the audit of the Spanish Banking Sectorare expected to be published during the month.
  • 20. US – Will the QE3 be finally announced?-Data about employment will have a high importance for a decision. Non-Farm Payrolls Initial Jobless Claims 600 700 667 400 650 200 163 600 0 550 -200 500 -400 450 -600 400 374 -800-1000 350
  • 21. US – Will the QE3 be finally announced?-PIMCO’s Bill Gross thinks that we are close of the QE3. “Unemployment is still above 8% and it’s obviousthat the FED isn’t comfortable”. Until unemployment is below 7% or inflation is higher than 2%, we shouldcontinue to assist to additional stimulus from the FED.
  • 22. Major risks for the markets-Accordingly with PIMCO’s El-Erian, the 4 major risks for the global economy are the Fiscal Cliff in the US, theSovereign Debt Crisis in Europe, a Geopolitical conflict and an economic slowdown from China.
  • 23. Technicals tells us to buy
  • 24. But Fundamentals are misleading Vicious Cycle of Europe. We are currently on level 2.
  • 25. Asset allocationLong Term Positive but still conservative due to market risks Corporate Bonds (name selection) Emerging Markets Equities European Equities US Equities Emerging Markets Currencies Commodities Sovereign Debt
  • 26. DisclaimerDisclaimerA Fincor—Sociedade Corretora, S.A. fornece somente serviços de recepção,transmissão e execução de ordens. Os conteúdos mencionados não constitui (enão será concebido de forma a constituir) qualquer espécie de aconselhamento,ou recomendação de investimento, ou um registo dos nossos preços denegociação, ou uma oferta ou solicitação para a transacção de qualquerinstrumento financeiro. A Fincor—Sociedade Corretora, S.A. não aceitaráqualquer responsabilidade em consequência de qualquer uso que possa ser dadoao referido conteúdo ou sobre qualquer efeito que daí advenha.
  • 27. Contatos :FINCOR – Sociedade Corretora, SARua Castilho N.44, 4º Piso1250-071 Lisboa, PortugalTel. +351 21 382 40 10Fax.+351 21 380 30 49fincor@fincor.ptwww.fincor.pthttp://fincorcorretora.blogspot.pt/