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THERE ARE NO WARRANTIES, EXPRESSED OR IMPLIED, AS TO ACCURACY, COMPLETENESS, OR RESULTS OBTAINED FROM ANY INFORMATION DISCUSSED DURING HAWKTRADE MEETINGS. Past performance does not guarantee future results. Investment returns and principal value will fluctuate, so that investors' shares, when sold, may be worth more or less than their original cost. Investing in any financial instruments does not guarantee that an investor will make money, avoid losing capital, or indicate that the investment is risk-free. There are no absolute guarantees in investing. HAWKTRADE and its members do not bear any responsibility for losses or gains made by members trading on their personal accounts based on analysis from HAWKTRADE meetings.
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