MARKET RESEARCH

Nov 18th Nov 22sd

SPOTLIGHT
German Economic Sentiment

Portugal issues bonds with lower yields

The Portuguese stock market closed the week with a positive return. On Monday, Fitch considered plausible that Portugal may recover the access to international markets next year, avoiding a second bailout. The OECD announced their estimates for the Portuguese economy, stating that it will retreat 1,7% this year, but will grow 0,4% in 2014. On Wednesday, the state issued 700 and 300 million euros of 12-month and 3month treasury bills, with yields decreasing from 1,619% and 1,159% to 1,493% and 1,076%, respectively, since the last comparable auction.

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INDEXES PERFORMANCE
Nov 18
PSI 20 STOXX 50 FTSE 100 DAX CAC 40 NIKKEI 225 HANG SENG
6.363,67 3.081,30 6.723,46 9.225,43 4.320,68 15.164,30 23.660,06

German economy fuels optimism

Nov 22
6.350,31 3.055,98 6.674,30 9.219,04 4.278,53 15.381,72 23.696,28

Nov 19
6.354,24 3.049,17 6.698,01 9.193,29 4.272,29 15.126,56 23.657,81

Nov 20
6.294,59 3.047,32 6.681,08 9.202,07 4.268,37 15.076,08 23.700,86

Nov 21
6.322,60 3.044,34 6.681,33 9.196,08 4.253,90 15.365,60 23.580,29

Wkly Chg
0,48% 0,05% -0,29% 0,55% -0,32% 1,42% 2,88%

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CURRENCIES
Nov 18
EUR/USD EUR/CHF EUR/GBP EUR/JPY EUR/YUAN AUD/JPY
1,350 1,233 0,838 134,840 8,228 93,550

Nov 19
1,356 1,233 0,841 135,880 8,265 94,580

Nov 20
1,343 1,232 0,834 134,650 8,185 93,530

Nov 21
1,347 1,231 0,833 136,460 8,211 93,470

Nov 22
1,356 1,230 0,836 137,280 8,261 92,860

Wkly Chg
0,44% -0,41% -0,20% 1,52% 0,46% -1,10%

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REFERENCE RATES
Nov 18 Euribor 1M Euribor 3M Euribor 6M Euribor 12M Eonia
0,123% 0,218% 0,319% 0,497% 0,084%

European shares closed this week mixed, with the British and French indexes falling, while the German rose. This week, the Bank of England's monetary policy committee expressed its uncertainty over the durability of the U.K.'s economic recovery. Also in the U.K., the index of industrial order expectations rose to 11,0 this month, with analysts expecting it to improve to 1,0. On the French front, the Manufacturing and the Services PMIs fell to 47,8 and 48,8, respectively, contradicting expectations of upward movements. On the other hand, German economic sentiment rose to the highest level in more than three years, with the manufacturing activity in the country expanding this month at the highest pace since June 2011. In the Euro Zone, the current account recorded a surplus of 13,7 billion euros in September, while the trade surplus widened to 14,3 billion euros from 12,3 in the previous month.

Nov 19
0,124% 0,218% 0,319% 0,496% 0,086%

Nov 20
0,124% 0,219% 0,318% 0,495% 0,091%

Nov 21
0,126% 0,217% 0,316% 0,489% 0,108%

Nov 22
0,133% 0,223% 0,321% 0,492% 0,117%

Nikkei 225 hits a new 6-month high

Asian equities were high this week with the Nikkei climbing to a 6-month high. In Japan the exports rose a stronger-than-expected 18,6% in October, notching up the fastest gain in over three years thanks to the weak yen and a pick-up in overseas demand. However, as imports also strengthened, the trade balance remained firmly in deficit by around 2,5% of the GDP. On the Chinese front, home prices hit new record highs in October, underlining the challenge face by the government, just a few days after it unveiled measures aimed at fostering a stable property market. Moreover, the Chinese PMI fell to 50,4 in November. In Australia, the RBA Governor said this week he was "open-minded" on whether to intervene to try and push the Australian dollar lower.

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BOND YIELDS
Nov 18 Portugal 6M Portugal 5Y Portugal 10Y Spain 10Y France 10Y Italy 10Y Germany 10Y UK 10Y
1,451% 4,896% 5,984% 4,071% 2,244% 4,067% 1,684% 2,724%

Nov 19
1,380% 4,906% 5,982% 4,092% 2,270% 4,074% 1,720% 2,723%

Nov 20
1,395% 5,009% 6,051% 4,098% 2,266% 4,074% 1,722% 2,739%

Nov 21
1,397% 5,009% 6,053% 4,111% 2,296% 4,095% 1,741% 2,813%

Nov 22
1,566% 4,951% 5,992% 4,120% 2,279% 4,086% 1,749% 2,794%

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SPOTLIGHT
US Producer Price Index

S&P yields largest annual return since 2003

U.S. stock markets started the week in red territory, but reversed the trend on Thursday, after initial jobless claims declined to near two-month low. Federal Reserve officials said they might reduce their $85 billion in monthly bond purchases in coming months as the economy improves. However, Fed Chairman Ben Bernanke said it will probably hold down its target interest rate long after the end of the program and possibly after the unemployment rate falls below the defined 6,5% threshold. U.S. home resales fell in October to their lowest level since June, after an inventory shortage and high property prices dampened buying power. On the spotlight this week, wholesale prices in the U.S. fell in October for a second month, reflecting cheaper energy costs. The 0,2% drop in the producer-price index followed a 0,1 decline in the previous month.

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INDEXES PERFORMANCE
Nov 18
S&P 500 DJIA NQ 100 S&P Lac 40
1.791,53 15.976,02 3.388,87 3.872,99

Nov 19
1.787,87 15.967,03 3.378,13 3.813,70

Nov 20
1.781,37 15.900,82 3.367,17 3.782,62

Nov 21
1.795,85 16.009,99 3.402,73 3.762,01

Nov 22
1.804,76 16.064,77 3.422,02 3.798,12

Wkly Chg
0,37% 0,65% -0,02% -0,45%

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CURRENCIES
Nov 18
USD/JPY USD/YUAN AUD/USD GBP/USD USD/CHF USD/CAD
99,870 6,092 0,937 1,611 0,913 1,043

Mexico outperforms Brazil and Argentina

Nov 22
101,270 6,137 0,917 1,622 0,907 1,052

Nov 19
100,170 6,093 0,944 1,614 0,909 1,046

Nov 20
100,250 6,093 0,933 1,610 0,917 1,046

Nov 21
101,300 6,093 0,923 1,618 0,914 1,052

Wkly Chg
1,08% 0,09% -2,16% 0,65% -0,85% 0,77%

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COMMODITIES
1,18% 3,76% 2,09% 0,36%
Crude Oil WTI Natural Gas Crude Oil Brent Corn

-3,61% -4,56% 1,51% -0,91%

Gold Silver Copper Sugar

Mexicos gross domestic product fell less-thanexpected in the last quarter, to 1,30%, from 1,50% in the preceding one. Moreover, the Mexican economic activity fell to 0,79%, beating market expectations of a decrease to 0,50%. Brazil posted a current account deficit of $7,132 billion in October, a level close to the worse forecasts. Foreign direct investment in Latin America's largest economy was $5,632 billion in October, above market expectations of $5,3 billion. Lastly, Argentine industrial production fell 0,5% in October from the same period a year ago, while an increase of the same magnitude was expected.

Energy prices shoot up

Last week, oil prices shot up following the release of positive U.S. economic data, while talks on Irans nuclear program continued. Besides, natural gas prices soar after data revealed that U.S. stockpiles declined more than expected and updated weather forecasting models called for below-normal temperatures, including the possibility of a powerful winter storm shooting up the Atlantic seaboard. On the other hand, gold and silver prices declined on news that Fed could begin tapering asset purchases in the upcoming months. Finally, sugar prices dropped after the U.S. Department of Agriculture forecasted record inventories.

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US TREASUR Y YIELDS
Nov 18 US 3M US 1Y US 10 Y US 30 Y
0,074% 0,129% 2,666% 3,757%

Nov 19
0,084% 0,132% 2,712% 3,804%

Nov 20
0,081% 0,122% 2,804% 3,916%

Nov 21
0,076% 0,123% 2,784% 3,887%

Nov 22
0,076% 0,120% 2,744% 3,833%

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Beatriz Fougo

Carlos Pereira

Catarina Borges

David Novo

Jorge Rodrigues

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