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Market YTD Returns

S&P 500 DowNasdaq

-8.49% -9.95% -4.62%

Stock (Original) Comp Returns

Trader Comp Returns

Commodity PricesWhy the Drop?

Commodity prices have been steadily dropping since 2011.

Main Reasons for Drop:

Chinese economy is on the verge of a major slowdown, especially in the Industrial’s/real estate sector.

Chinese Manufacturing PMI

An indicator of the economic health of the manufacturing sector. The PMI index is based on five major indicators: new orders, inventory levels, production, supplier deliveries and the employment environment.

A reading of 50 means no contraction, >50 means expansion, and <50 means contraction

Manufacturing is a good general indicator for the whole economy.

Number Dropped from 47.3 to 47

Explanation:China’s Explosive Growth in previous years caused energy and

metals companies to ramp up production. Now with the slowdown in growth, there is a huge supply glut as commodity-based companies adjust to China’s slower growth.

Most commodities are priced in dollars, which also depresses demand because commodities become more expensive to buy in cheaper currencies, especially those from emerging markets.

Many economies heavy in commodities exports are facing recession

Examples include Australia (almost in a recession) and Brazil (currently in a recession) among others.

Australia- The majority of exports come from mining.

AustraliaIn 2014, $90.13 of it’s total $179.34 exports went to

China. That’s around 50%!

Companies effected: Glencore Glencore is a commodity trading and mining company in Switzerland.

Worlds Largest commodity trading company.

Glencore Stock

Alcoa Splitting Up!

126 yr old Global Industrial Aluminum company splitting into two companies Raw Aluminum Production (keeps

Alcoa/AA as name/ticker) upstream Value-added parts-making business

(aluminum for cars, jet engine/airfoils, etc.) downstream

CEO Klaus Kleinfield going over to new entity

AA Stock Price

Sector Updates

Healthcare

S&P Biotech down 23% Market correction or fear of more

regulation? Clinton Tweet:

Financials

Bank of America Lay-Offs Reasons? BofA lagging behind other

banks.. Investors fall “out of love” with deals

M&A boom over? Junk bond trading lags Industry concern over mortgage

rules Transparency in mortgage terms – good

for consumers, bad for banks

Consumer

Strong performance by Nike Gap CEO leaves for Ralph Lauren Tesla Model X revealed

8-12 months until delivery

Tech

“El Capitan” released for Mac computers

Google Nexus phone Student creates ion thruster

Able to send spacecraft to Mars and back?

XPRIZE competition $20 million prize!

Energy

Obama fracking rules blocked Crude volatility

Up on Syria Down on hurricane news Q3 end supply gains

Industrials