NEFS Market Wrap Up Week 3

Week Ending 8th November 2015

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NEFS Research Division Presents:

The Weekly Market

Wrap-Up

NEFS Market Wrap-Up

2

Contents Macro Review 3 United Kingdom

United States Eurozone

Japan Australia & New Zealand

Canada

Emerging Markets

10

India China

Russia and Eastern Europe Latin America

Africa South East Asia

Equities

16

Retail Oil & Gas

Financials Technology

Pharmaceuticals Industrials & Basic Materials

Commodities

Energy Precious Metals

Agriculturals

22

Currencies 25

EUR, USD, GBP AUD, JPY & Other Asian


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THE WEEK IN BRIEF

Interest rates

Despite learning that GDP growth fell to 1.9% in

the US last week, the Federal Reserve

signalled that there is a real possibility of an

increase in the base interest rate in the near

future, as the underlying strength of the

economy appears to be growing. Meanwhile,

Mark Carney, Governor of the Bank of England,

surprised many by eluding that UK interest

rates could be raised earlier than many have

been forecasting; markets have now priced in

that rates could rise in the second half of 2016

rather than 2017. This came in spite of the

BoE’s downward revision of inflation forecasts

for 2016 and 2017, with inflation still remaining

well below the BoE’s 2% target. However, this

week we also learned that the Eurozone’s

growth forecasts have been revised down for

each of the next two years; monetary easing

seems to be approaching, and the prospect of

interest rate hikes there seems a long way off.

Strengthening

Dollar

The US dollar has continued to appreciate this

week, hitting a three month high on Friday

following the non-farm payrolls report, with the

EUR/USD being driven closer to parity. As a

result, the price of commodities (which are

traded in USD) have fallen on the week. Already

very low oil prices posted their third weekly

decline in four weeks, falling for three days in a

row over the week, while the price of gold hit a

seven week low. The price is being pushed

down further by the belief that a US rate hike

could be approaching, as this would reduce

demand for gold as the rate of return from

saving increases.

TPP Made Public

This week the terms of the Trans-Pacific

Partnership were released to the public for the

first time, bringing together the US with a

number of Pacific Rim countries. Covering 40%

of the global economy, the agreement is the

largest regional trade deal in history. The

Partnership is focused at reducing barriers to

trade between members, such as tariffs, quotas

and “red tape”, as well as harmonising

regulations. It is hoped to instigate increased

trade between those signed up, bringing

efficiency benefits and increased economic

growth. It is clear that it will take time for the

terms of the deal to be fully implemented, but if

they can be, the scope for benefits is huge.

Jack Millar

NEFS Market Wrap-Up

4

MACROREVIEW

United Kingdom

This week’s headline regards the release of the

Bank of England’s (BoE) quarterly inflation

report. The report presents inflation projections

and analysis, on which the monetary policy

committee bases its interest rate decisions.

CPI inflation in September fell to -0.1%, well

below the BoE 2% inflation target. The BoE is

unlikely to meet its target until the end of 2017

and the lower bound of 1% not before the

second half of 2016, illustrated below. However

the BoE estimates that around four fifths of the

deviation is attributed to negative contributions

from energy and food prices. These are subject

to greater short term volatility and therefore do

not represent a long term deflationary trend;

only one fifth of deviation is due to subdued

demand cost growth. In fact the current zero

inflation is regarded as an economic stimulus,

which, coupled with real wage growth is set to

boost consumer spending. With a weaker

global economic outlook, brought about by a

slowdown of many emerging economies like

China on export orders, robust domestic

household and corporate spending is needed.

As a result the report has made no plans for an

upcoming base rate rise, suggesting it will

remain at 0.5% well into 2016.

However, encouraging domestic consumption

does have potential negative consequences. In

particular uncontrollable credit and house price

growth. Indeed the BoE is considering using

measures to rein in credit, as it has the power

to raise capital requirements for bank lending.

While household debt to income has declined

since the financial crash recent high lending

trends could reverse this.

This week also saw the release of the

Purchasing Managers’ Indices for services and

manufacturing. The PMI are an indicator of

economic activity, derived from monthly

surveys of businesses, and therefore are a

good measure of current economic

performance. The services PMI rose to 54.9

and manufacturing posting a surprising 55.5,

where a figure above 50 signalling growth.

Manufacturing figures posted well above

expectations, suggesting that the sector may be

in better health than previously thought.

All in all, with manufacturing and exports

currently struggling due to weak demand from

developing nations and a strong pound,

domestic consumption must be reinforced to

drive economic growth. As a result, households

and businesses need a prolonged period of

stability and the continuity of the present low

base rate provides this.

Matteo Graziosi


5

United States

Ms Janet Yellen gave an indication that the

Federal Reserve’s December 15-16 meeting

would be a “live possibility” for a rate rise.

Diminished downside risks from global

economic and financial developments and

significant labour market tightening since the

start of the year prompted the remark.

Hiring in the US reached its highest level this

year. According to the Bureau of Labor

Statistics, nonfarm payrolls rose by a

seasonally adjusted 271,000 compared to

forecasts of just 181,000. This also beat last

month’s figures of 137,000, bringing the

monthly average over the last three months to

187,000. Nonfarm payrolls measure the change

in the number of employed people during the

previous month, excluding the farming industry.

On a similar note, the unemployment rate

matched estimates and fell slightly to 5.0% in

October from 5.1% in the previous month. It is

now at its lowest level since April 2008 and is

closer to Fed officials’ 4.9% median projection

for its normal long-run level. Average hourly

earnings in the private sector rose last month

by 9 cents to $25.20 from October. Wages are

now up 2.5% over the year and this is higher

than the 2% average pace during the six-year

expansion. Overall, this week’s encouraging

labour data should be more than sufficient for

the Fed to consider a rate rise at its next

meeting, as it tries to boost inflation levels to

meet its 2% target.

The US Trade Balance, the difference in the

value of imports and exports of goods and

services, went up by $7.2 billion to a $40.8

billion deficit, beating a forecast of a $42.7

billion deficit. Broken down, imports fell by $4.2

billion to $228.7 billion, while exports rose $3

billion to $187.9 billion. Given the sharp rise in

the US dollar over the year, we should expect

the deficit gap to widen in the near future, as US

exports become more expensive, dragging

modestly on US GDP growth.

On Thursday, we got a look at the text of the

Trans-Pacific Partnership agreement. Tariffs on

everything will be lowered or eliminated and

40% of the global economy will be open to

easier trade in services and electronic

commerce. The agreement also sets

international rules in areas such as the

intellectual property of advanced

pharmaceuticals and arbitration that lets

investors challenge foreign governments.

Rather interestingly, the agreement makes no

explicit mention of one of the hottest phrases –

‘climate change’.

Sai Ming Liew

NEFS Market Wrap-Up

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Eurozone

In its autumn forecast the European

commission has downgraded its prediction on

the growth level of the 19 nations of the

Eurozone. In May, it was forecast that growth in

2016 in the Euro area would be 1.9%, while it is

now predicted that the Euro area will grow by

1.8% in this time period. In 2015 the growth of

the Euro area is expected to be 1.6% and in

2017 the European commission is expecting

the growth rate to be 1.9%. It is also expected

that inflation will increase from 0.1% currently to

1.6% in 2017; the cost of living for Eurozone

citizens is predicted to rise at an increased rate.

The European commission stated that the

weaker Euro, challenging global market

conditions and a slowdown in major emerging

economies has played a role in the reduction of

the growth forecast. The Vice President of the

European Commission, Valdis Dombrovskis,

did say in a statement that “Today’s economic

forecast shows the euro-area economy

continuing its moderate recovery,”

A challenge for the economic performance of

the countries in the Euro area in the immediate

future is the level of uncertainty. There are risks

associated with the slowdown in emerging

markets on trade with the Euro area. China for

example is one of the biggest trading partners

of the Euro area and it has recently experienced

a greater than expected slowdown in its

economic performance. The report also states

that some of the uncertainty has been caused

by US monetary policy.

In a different report released this week by

Destatis, production levels in Germany, the

Euro area’s largest economy, declined In

September. Industrial production fell by 1.1% in

comparison to August 2015, as shown on the

graph below. This is the biggest fall in industrial

production in Germany since August 2014,

which was due to a fall in production in all

sectors of the Germany economy except the

energy sector. Once again one of the reasons

given for the fall in production was a slowdown

in emerging economies. The German economy

ministry stated "After a good development in the

first half, German industry is currently

experiencing a light headwind from the world

economy, in particular due to a slowdown in

some large emerging markets”. With the

Eurozone continuing to be afflicted by global

uncertainty, it seems likely that it will take longer

than expected for the economy to make a full

recovery.

Kelly Wiles


7

Japan

On Wednesday Prime Minister Shinzo Abe

called on his ministers to create a new set of

economic stimulus measures within the month.

The fresh stimulus measures will aim to achieve

targets such as the gross domestic product goal

the PM announced in September – to raise

nominal GDP to ¥600 trillion in five years. To

achieve this Mr Abe has called on the business

community to “actively engage in capital

investment and wage increases,” and added

that the government will support firms to do so.

These new stimulus measures will aim to

bolster the credibility of the “Abenomics”

programme that got the current PM re-elected

in 2012. Abenomics consists of three “arrows”

which includes loose monetary policy,

expansionary fiscal policy and structural

reforms. Thus far the government has been

overly reliant on quantitative and qualitative

easing (QQE), fiscal policy has been modest,

and structural reforms are considered to be the

“missing arrow”.

The latest consumer confidence data indicates

an increase on the previous month from 41.1 to

41.5. However, this measure which surveys

around 5,000 households has not made

significant progress since the inception of

Abenomics. The graph below shows how,

despite a strong recovery in consumer

confidence during 2013, respondents think

Japan’s economic conditions have improved

only marginally since the PM’s re-election. This

builds a growing case for Abe’s government to

shift importance to structural reforms.

With the returns to QQE seeing diminishing

returns, like most QE programmes worldwide,

structural reforms have the potential be a

significant driver of Japan’s economy in the

long run. Since 2012 Mr Abe has made some

progress in areas such as agriculture by limiting

the power of special interest groups, moving

towards the liberalisation of the energy market

and increasing female participation in the

labour force. However, reforms for more

politically sensitive areas such as immigration

have been ignored.

Foreign workers currently only account for 0.3%

of the labour force, the lowest figure across any

OECD country. Reforms to relax immigration

could help eliminate Japan’s chronic labour

shortage and provide an instant boost to

growth. The scope for further labour market

reforms – which could raise productivity and

real wages in Japan – remains significant and

largely unaddressed.

Loy Chen

NEFS Market Wrap-Up

8

Australia & New

Zealand

After enjoying trade surpluses in 2010 and

2011, Australia recorded its 16th consecutive

monthly balance of payments deficit. As

illustrated in the graph below, the deficit has

marginally improved by 15%, falling from 3.10

billion to 2.32 billion, a much better result than

predicted by economists.

What caused this improvement? The value of

exports rose by 3% owing to a rise in non-

monetary gold by 10%. This was aided by the

stabilisation of iron ore prices along with the

depreciation of the Australian dollar,

contributing to a surge in iron ore exports by

7.9%. However imports continued to remain

strong, rising by 3% as consumption goods also

rose by 3%.

National Australia Banks’ (NAB) Tapis

Strickland believes the deficit may fall further as

Liquefied Natural Gas (LNG) projects began in

Queensland in October and are due to start

elsewhere, therefore boosting exports further.

However, such sentiments are not shared. JP

Morgan’s economist Tom Kennedy believes

that “the pick-up in nominal export growth” is

unlikely to continue as it was “owed entirely to

a surge in non-monetary gold shipments”, an

unreliable indicator for continued

improvements.

Could these figures have a larger impact?

Strickland believes that the improvement in the

trade balance may make significant

contributions to economic growth, expecting a

0.6 percent improvement in the September

quarter.

In other news, New Zealand’s labour market

appeared to be keeping up with population

growth until recently. Unemployment rates

reached 6 percent, a 0.1% rise since August

and a 0.4% rise over the past year. Figures

have shown that the number of people

employed dropped by 11,000 in three months,

however economists previously expected that

10,000 jobs had been added during the

September quarter. Unemployment remains

higher in the South Island, which experienced a

1% rise, compared to the North Island, which

saw a 0.3% rise, however this gap is narrowing.

Despite the creation of jobs in the economy

over the past year, the growth of the workforce

has exceeded any potential for this to improve

employment rates. The fall in employment is

mainly due to the 4.1% drop in part time jobs,

however, record high migration (net gain by

around 60,000 in August) has meant the

number of those unemployed has risen by

10.5% in 12 months.

Meera Jadeja


9

Canada

There was some encouraging news for Canada

this week, as figures from October’s Labour

Force Survey beat economists’ expectations

four-fold. After four months of little change,

44,400 jobs were created in October, compared

to the 10,000 increase that economists

forecasted. As shown in the chart below, this

led to the unemployment rate falling from 7.1%

in September to 7.0% in October, as

employment is up by 143,000 compared to

October 2014. Youth unemployment also fell

from 13.5% in September to 13.3% in October.

Canada is not currently performing at its

economic potential, so these are welcome

figures from Statistics Canada - however, the

headline news is not as reassuring as it seems,

owing to three main reasons.

The public administration sector accounted for

72% of the new jobs, but these are temporary

jobs for the federal election, so is not a lasting

boost to the economy. In fact, this should have

been expected; past trends show similar spikes

in employment during election and consensus

periods.

Secondly, 80% of the new jobs are for part time

work. This could imply slack (excess capacity)

in the labour market. Stephen Poloz, the

Governor of the Bank of Canada, has

previously stated that inflation, which is at 1.0%,

may only reach the 2% target in mid-2017 due

to slack in the economy. Regardless, there has

been an increase of 9,000 full time jobs which

is a positive step.

Thirdly, unemployment in the resource industry

has steepened, due to ongoing effects of the fall

in the oil price. 26,000 job losses have occurred

in the resource industry over the last 12 months,

many of which have been geographically

concentrated in the province of Alberta.

In other news, Scotiabank have predicted that

the Canadian dollar will continue to depreciate

for at least the next year. Downward pressure

on the currency is due to a distressed energy

sector along with a GDP rate of 0.1%, making

Canada less attractive to invest in. Additionally,

the prospect of a rate rise by the Federal

Reserve in December makes nearby US a

more attractive place for investment, in

comparison to Canada where a rate cut would

seem more likely than an increase. This is

already being evidenced as the US dollar

increased by more than 1% as traders predict a

72% likelihood that US rates will rise next

month.

Shamima Manzoor

NEFS Market Wrap-Up

10

EMERGING MARKETS

China

In the face of recently rising market rates,

China’s Securities Regulatory Commission

stated this week that IPOs would be restarted

after they had been suspended in July as a part

of a rescue package to stabilize the stock

markets. On Friday the Shanghai Index closed

up on the highest level since midst of August.

"The new shares won't be issued immediately

and the amount of fund used for new shares will

be relatively small. Investor confidence has

recovered and they may interpret this as a sign

of market stabilisation," said Mr Jiahe, an

analyst of Cinda securities.

Furthermore, the Caixin Manufacturing PMI for

the last month has been published. It rose to

48.3 in October from 47.2 in September and,

thereby, exceeded the forecast which has been

47.7. This index measures the nationwide

manufacturing activity. It's a leading indicator of

economic health - businesses react quickly to

market conditions, and their purchasing

managers hold perhaps the most current and

relevant insight into the company's view of the

economy. Thereby, a reading below 50

indicates a contraction in manufacturing

activity, while a level above 50 indicates an

expansion. Hence, the reading suggests the

shrinkage in manufacturing activity, marking the

eighth straight month of contraction, as the

graph below shows.

"The slight upswing shows the manufacturing

industry's overall weakening has slowed down,

indicating that previous stimulating measures

have begun to take effect," said He Fan, chief

economist at Caixin Insight Group.

Besides, the Caixin Services PMI was also

published this week. The index rose to 52.0 in

October, up from September's 14-month low of

50.5 while it also succeeded the forecast of

51.0. China's service sector has been one of

the few bright spots in the economy, helping to

offset a sharp slowdown in traditional industries

battling idle capacity and weakening demand.

In the first three quarters of 2015, services

accounted for 51.4% of gross domestic

economy, up from 49.1% in the year-earlier

period.

Additionally, since the actual indices exceeded

the expectations this could be considered as

good signal for the Chinese currency, as well,

as it indicates that China is recovering from its

recent economic struggles.

Alexander Baxmann


11

India

Despite the world’s optimistic outlook for India

and its economy, inequality in different forms

still persists on a large scale within the country,

hindering development and economic growth.

We often forget that a predicted growth rate of

7.5% and a steadily decreasing unemployment

rate are not all-encompassing and that the rapid

growth that India has seen in the past decade

has sadly not led to substantial improvements

in gender equality on a scale that it perhaps

should have.

Female labour participation in India has not

increased in recent years despite the country

cementing itself as the fastest growing

economy in the world. A new report now

suggests that the way to maintain this status is

by pushing for gender equality, which could add

$700 billion to the economy by 2025. The

female labour force participation rate in India

currently stands at a disappointing 31%, but by

raising this to 41% by 2025, GDP growth could

see an incremental boost of 1.4% per year.

At 17%, the female contribution to GDP in India

is much lower than the global average of 37%

and when compared to other nations such as

China and Sub Saharan Africa, where women

account for 41% and 39% of GDP respectively,

the figure is embarrassing. The report states

that the Indian economy would receive the

highest relative boost among all regions of the

world if its women participated in paid work on

a similar basis to men. The extensive gap

between the male and female participation rate

is illustrated below, highlighting that the gap is

much greater in India than in other economies.

The research also highlighted the unequal sharing of household responsibilities between men and women in India. Women perform 10 times the amount of unpaid care work than men and if this unpaid work could be valued and compensated, it would contribute $0.3 trillion to India's economic output. If the government wants to unlock the vast

untapped potential that lies within the female

population of India, it must help expand skills

training in key sectors and provide greater

access to financial services, along with getting

more girls into primary and secondary

education. Ultimately, the country must address

deep rooted patriarchal attitudes, both at home

and in the workplace.

Homairah Ginwalla

NEFS Market Wrap-Up

12

Russia and Eastern

Europe

Following news this week that Russia may face

a meat and dairy shortage in 2016, the Western

view of the Russian economy is one of a stark

nature. In addition, Dr Birgit Hansl – lead Russia

economist for the World Bank – shared her

macro outlook, and the findings are somewhat

more hopeful than one might think.

Often forgotten is the import embargo Putin

ordered in retaliation to the Western sanctions,

just over a year ago. A government report

shows that the embargoes have made a

disproportionately large contribution to the

general decline in trade, resulting in a 38.8%

decrease in imports and, subsequently, a

blatant hole in the market. Unprepared

producers failed to fill this gap in the short term,

leading to a rapid increase in domestic prices,

which contributed to the already present

inflationary pressures. Only now have Audit

Leaders hinted at a possible shortage in

essential foodstuffs in 2016, alongside

estimations that 80% of cheese in

supermarkets is counterfeit.

Birgit Hansl identifies the 2014 trade shock as

a significant contributor to economic troubles in

Russia and the addressing of the high inflation

rate through a shrewd budget policy as a matter

of high importance. The World Bank estimates

Russia’s recession will continue, with -3.8%

growth forecast for this year and -0.6% for 2016

– a dire outlook in itself – but even worse when

combined with the predicted climb of 14% in the

rate of poverty - the greatest increase since

1998/99. This carries knock-on effects for the

Russian middle classes who are already

bearing the brunt of high inflation rates as they

see their real wages and savings eroded.

Conversely, the private sector is benefiting from

the economic disarray, heeding Putin’s advice

and making use of the exchange rate

uncertainty by paying off foreign debts (see

graph below) and loading up on foreign assets.

With this comes an increase in capital flight –

just this week Alexander Grigoryev (a high level

banker) was arrested for illegally moving $50

billion out of the country over the last 3 years.

This economic slowdown is an opportunity to

address structural faults such as reliance on

natural resources and an ageing population.

What is more important in the short term,

however, is making clear the economic policies

the country is to pursue. This week, Rosstat

surveys showed that “uncertainty about

economic policy” has become a key constraint

mentioned by Russian businesses.

This recession is not a time to repent, but to

restructure.

Tom Dooner


13

Latin America

Brazil reported a USD 1.996 billion trade

surplus in October of 2015, compared to a USD

1.1 billion gap a year earlier, higher than market

forecasts. It is the eight straight month of

surplus as imports fell more than exports.

Although it beat expectations, these results

aren’t surprising considering September’s

figures on Brazil’s Trade Surplus were at a

three month high. In fact, for the first nine

months of the year, the country has posted a

surplus of USD 12.24 billion.

A major contributing factor is that over the past

year the Real has lost circa 50% and 30% on

the dollar and euro respectively, so something

would be very wrong with Brazil’s economy if

they were not now trading in a surplus

considering the Eurozone and US are key

trading partners for Brazil. In the past Brazil ran

regular trade surpluses, primarily due to high

export of mining and agricultural products. In

2013, the country started recording trade

deficits and in 2014 registered their first annual

trade deficit since 2000 as a decline in the value

of commodities exports had a greater effect

than the fall in imports of consumption products.

So perhaps Brazil is on the road to recovery.

However this seems unlikely due to other

economic indicators looking bleak for the

country. GDP in Brazil contracted 2.60% in the

second quarter of 2015, year on year, worse

than market expectations. Brazil is struggling

through this current recession which has seen

five straight quarters of contraction and a

reduction in GDP of 6.2 percentage points.

There’s no single reason why the economy has

nosedived, but comes from a confluence of

factors. Individually many of these reasons

would have caused minor blips in the economic

performance of a country, however when

pooled together their effects are multiplied.

Such factors include; dire performance of the

Real, poor consumer confidence and

subsequently low personal consumption,

political crisis and a credit rating that in August

was rated at near junk by Moody’s.

It is very difficult to predict the future

movements of Brazil’s economy especially

when so many factors are determining it,

however one indicator may be certain, as the

government expects the trade surplus to reach

USD 15 billion this year and to widen to USD 25

billion in 2016, as a weak Real could be here to

stay.

Max Brewer

NEFS Market Wrap-Up

14

Africa

Another African debt crisis is looking likely

again, as announced on Wednesday. Falling

commodity prices and a slowing Chinese

economy have once again led to unsustainable

borrowing, hence increasing Africa’s sovereign

debt to around 44% of GDP. Economists fear

that if this continues and risk of default

increases, lending interest rates will be

increased to levels that are unaffordable for

most African countries, consequently halting

development. It will also put a strain on the

social spending budget, thus restricting

services for the public and causing social

unrest. Whilst one solution would be increasing

inflation across the continent, as the debt’s

value would decrease relative to the currency’s

value, this would erode away the wages and

savings of civilians, thereby reducing

consumption. This solution would also require

augmented Government spending, which

would increase the debt further.

In Algeria, over-reliance on oil exports and

falling oil prices has meant the country is

reforming its market in order to avoid

bankruptcy. Oil exports formerly provided 60%

of revenues, hence there is now a great

pressure on spending and the trade deficit,

which has ballooned from $4.09bn to $10.33bn.

Subsequently Algeria is investing heavily in its

industries and local businesses, whilst also

introducing import licenses and custom duties

on imported goods. Whilst trade protection is

not ideal, it is necessary if Algeria wishes to

protect its infant industries. It will inevitably

increase prices and lower standards of living,

however by increasing efficiency in the long-

term, it is hoped that wages and employment

will increase, whilst costs fall. Red tape, state

control of businesses and business taxes are

also going to be reduced, consequently making

the economy more attractive for commerce.

With Zambia’s rate of inflation soaring from

7.7% to 14.3% in under a month (see graph),

interest rates have increased even further from

12.5% to 15.5%. The high inflation rate is due

to the falling price of copper, thus halving the

value of Zambia’s kwacha against the dollar.

Accordingly, exports have increased, leading to

demand-pull inflation. Severely high rates of

inflation are bad for an economy, with the

greatest danger being a wage spiral, brought

about by the expectation of prices continuing to

rise. Fortunately as goods get more expensive,

trade becomes uncompetitive, leading to an

eventual decline in exports and disinflation.

However to end the inflation promptly, Zambia’s

interest rate has been increased in order to curb

spending and encourage saving.

Charlotte Alder


15

South East Asia

After 5 years of negotiating with some of the

biggest economies in the world such as Japan

and the USA, many of South East Asia’s

economies, including Indonesia, Singapore and

rapidly growing Vietnam, are finally ready to

reap the rewards of joining the Trans-Pacific

Partnership. With a month gone after

successful negotiations, all 12 participating

countries, one also being Malaysia, released

the agreement of more than a thousand pages

of detail, which is no surprise considering this

trade deal will have countries representing 40%

of the global economy. This makes it the largest

regional trade agreement in history.

The deal will reduce trade barriers on

everything from beef to textiles, with new and

bright ideas for environmental protection and

ambitious ideas of state-owned enterprises

competing with private companies in trade and

investment. It is estimated that joining the TPP

would boost Vietnam’s economy by more than

a fifth of its 2014 GDP if the membership

reaches 17 countries by 2025, shown in the

chart below. This would be huge for one of the

fastest developing economies and a hotspot for

foreign direct investment.

However, the TPP has come under a fair

amount of criticism, not being progressive

enough to win over the critics, even after

Obama’s prediction of removing tariffs of more

than 18,000 goods. The TPP will have long-

winded, incremental and slow benefits on

economic growth, unemployment and their

balance of payments position. For example,

mentioned in Vietnam’s appendix in the

agreement text, it will take 21 years before they

have fully eliminated their quota on imported

unmanufactured tobacco, which will have an

effect on its neighbour countries such as

Malaysia and Singapore. This is worrying,

particularly for countries such as Singapore,

whose GDP for this quarter was 0.1%, narrowly

avoiding recession.

With participating countries representing 40%

of the global economy, this trade deal seems to

worth the wait in the long-term, especially with

hints that South Korea and even China may join

in the future. With the El Nino Phenomenon

spiking food prices this week, it remains to be

seen whether Indonesia, Malaysia, Singapore

and Vietnam can survive the economic

challenges ahead for the next decade.

Alex Lam

NEFS Market Wrap-Up

16

EQUITIES

Retail

The retail sector has remained relatively flat this

week, with the Dow Jones Consumer Index

exhibiting a mere 1% fall, however a number of

firms’ share prices have exhibited considerable

fluctuations, and it is these equities which could

potentially be strong indications as to the future

of the sector.

One of these stocks is Stamps.com, a

NASDAQ listed company with revenues of just

under $200 million per annum. Stamps soared

by more than 35% in a single day, driven largely

by third quarter results which vastly outstripped

analyst predictions, with the online retailer not

only improving its revenues relative to Q3 2014,

but also augmenting it’s EBIT and EPS. Stamps

is interesting and revealing with regards to the

future of retail equities for a plethora of reasons.

As the name alludes, Stamps.com is an online

retailer, a sector which has shown 15% year on

year growth since 2001, and which is

responsible for an even greater share of retail

growth within the US economy, for example.

However, this is not the most interesting or

revealing aspect of Stamps’ business model,

for Stamps is one of many relatively young

online retailers which aim to shift traditional

brick and mortar business models to the online

arena. In Stamps’ case, this is postage, with

individuals and businesses alike now being

afforded the ability to print United States Postal

Service (USPS) labels with merely a home

printer, giving a vast array of time and cost

benefits relative to the traditional post office

model of sending mail. It is perhaps these

benefits which have resulted in Stamps’

remarkable growth since its 1996 inception, and

which are responsible for the company’s

unprecedented 135% share price increase

since the start of 2015. In much the same vein,

several other retail equities have also

attempted to transfer traditional business into

the online realm, and have also demonstrated

strong growth or prospects this week, with

Amazon rebounding from its October

difficulties.

As aforementioned, however, retail equities as

a whole have remained relatively flat this

month, with a lack of strong yet pertinent

information giving a resultant lack of fluctuation.

Only time will tell whether consumer spending

can increase enough to breathe life into a flat

lined sector.

Jack Blake


17

Oil and Gas

This week, oil prices turned lower on Friday due

to the stronger-than-expected US October jobs

growth, leading to expectations of an interest

rate hike by the Federal Reserve in December.

“The prospect of higher interest rates will propel

the U.S. dollar higher, providing headwinds for

a crude rally: hence, as the U.S. dollar rips

higher after the surprisingly strong

unemployment report, crude is sinking once

more” said Matt Smith, a commodity analyst at

ClipperData. Following news, Crude (CLZ5:

NYMEX) traded at $44.29 a barrel, down 91

cents or 2%, while Brent crude (LCOZ5:ICE

EU) lost 64 cents, or 1.3%, to $47.34.

I talked about ExxonMobil (XOM: NYSE) as one

of the few winners as far as energy stocks went

last week, but this week the company has been

investigated by the New York state attorney-

general in relation to whether it misled investors

and the public about climate change risks and

how it could affect the company. The subpoena

issued on Wednesday has already affected its

stock value, which fell by $1.16, or 1.38%, to

$83.65 as of Friday, as highlighted by the graph

below.

Having digested third quarter earnings from

companies such as BP, Royal Dutch Shell and

Total, analysts at Energy Aspects estimate

megaprojects expected to produce 5.2m

barrels a day of oil between 2016 and 2019

have either been postponed or delayed. 60 is

the magic number in the oil sector right now:

this number has been circulating the news and

reports all over in the past few weeks. But what

does it stand for? $60 is the price at which crude

oil will be in the next 2 years, at least according

to investor’s beliefs.

As a result, any new project requiring an oil

price of more than $60 a barrel – almost 50%

below last year’s peak – is now either being

scrapped or deferred until industry costs have

come down sufficiently. But does this mean

that $60 is the actual new long-term oil price?

Not necessarily. Big oil companies appear to

have as little idea as anyone what the price of

Brent crude will be this time next year – let

alone 5 or 10 years from now. None of them

were able to predict last year’s plunge, which

was caused by a US supply glut and OPEC’s

decision not to curb production.

Nevertheless, there are reasons why $60 is, for

now, a sensible assumption. Although higher

than the current spot price of $47, it is the price

where investors believe oil will be in two years

from now.

Andrea Di Francia

NEFS Market Wrap-Up

18

Financial Equities

This week again saw companies release Q3

results, as well as large developments in the

interdealer broking market. UBS [UBS: NYQ]

was not able to meet its profit targets for 2015,

causing its share price to fall 6% on Tuesday.

However, it was able to record an increase in

revenues in the fixed income and equities

trading division, bucking the industry trend and

showing that their business model is working.

ING bank [ING: NYQ] exceeded expectations

with pre-tax profits increasing to $1.63bn in Q3,

mainly due to fewer bank loans being provided.

Furthermore, insurance company, Allianz

[ALVX: GER] announced profits had dropped

15.4% to €1.36bn causing its share price to fall

2.5% on Friday.

Inter-dealer broker ICAP announced that it

would be selling its voice broking business to

market competitor Tullett Prebon. At the end of

2014 there were 1573 voice brokers at ICAP, all

of which will move to Tullett Prebon. The deal

comes at a time when ICAP is undergoing large

structural changes, due to the changing face of

the industry. As voice broking has declined

ICAP has focused on the more profitable

business areas, e-broking and post trade risk

mitigation services. On the contrary, Tullett

Prebon is looking to specialise in industries

which still require voice broking, such as oil.

Both companies’ share prices increased, with

ICAP being favoured by the market, seeing a

price rise of 10% on Friday. With growth in

demand for technology based broking and

increased financial regulations increasing the

necessity of post trade services, I expect ICAP

to prosper in the future.

Standard Chartered announced on Monday

that they made a loss of $139 million, which

came as unexpected news. The company

blamed divestment initiatives, depressed

commodity prices and China’s global slowdown

for the disappointing figures. Furthermore, they

announced £3.3bn would be raised from

investors to be used during their reconstruction

process, which involves delivering new

technology and updating regulatory systems.

The reaction to this was poor, as the market

was not convinced that Bill Winter’s strategy is

working. Fitch credit rating agency downgraded

Standard Chartered’s default rating from AA- to

A+, while the share price has fallen 14%

throughout the week. With so much uncertainty

around the business I doubt it will be a sound

investment decision.

Sam Ewing

(ICAP’s share price since Monday. Source: Yahoo! Finance)


19

Technology

This week we saw the global information

technology company Hewlett-Packard Inc.

experience a rise from $13.21 to $13.95. Whilst

HP’s rival, Lenovo Group Ltd, a Chinese

multinational computer technology company,

also saw a growth in share prices by 4.4% to

$7.58.

Facebook recently experienced a boost in

mobile-ad revenue, as a result of a 72% year-

on-year growth in advertising on smartphones

and tablets. Mobile advertising is a huge

contributor to the social media group’s ad

revenue, where it accounts for three quarters of

the total - a value that has increased by two-

thirds over a yearly period, driven by a 23%

increase in monthly active mobile users to 1.39

billion people.

Facebook stock prices were greatly influenced

by this growth in mobile advertising, with share

prices already being up by a third since the start

of the year. As a result of ongoing successful

performance, the online social networking

service has boosted its market capitalisation to

a new all-time high of $300 billion. On top of,

this they have recently announced their plan to

launch a news app, called Notify, sometime

next week. This will branch out Facebook’s

stance within the market in a hope to reach the

smartphone generation, allowing it to compete

with the likes of Snapchat and Twitter, whilst

contesting new publishing ventures from

Google and Apple.

This standalone app alerts users to new stories

from numerous media outlets that Facebook

has linked up with, with the likes of Vogue,

CNN, and Comedy Central being involved. With

share prices being up from $102.53 to $106.29

– a 3.7% increase this week upon the

announcement – investors will be pleased with

the development being made. Particularly

following a successful 3rd quarter, where net

profits grew 11%, with the total reaching $896

million. As a result, earnings per share were

$0.32, an increase of $0.01 since last year – a

small but progressive rise.

Even with costs growing at a faster rate than

sales this year, where they were up 68% to

more than $3 billion partly due to the addition of

1,000 new employees to the staff, it’s safe to

say that Facebook is expanding successfully

with an ever increasing market coverage. This

adaptable nature that the company instigates

ensures they are a huge competitor amongst

the likes of Twitter and Apple; safeguarding

what is a great share value and ultimately, a

great investment.

Daniel Land

Facebook’s weekly growth in share price

NEFS Market Wrap-Up

20

Pharmaceuticals

Apart from major developments related to

specific Pharmaceutical companies, equity

movements in this sector remained relatively

stable last week. The FTSE 350

Pharmaceuticals & Biotechnology Index fell by

only 0.23% by the end of last week and this

trend was echoed by the NYSE Pharmaceutical

Index which fell by 0.82% over the course of the

week.

Of particular concern is that Pharmaceutical

giant, Valeant Pharmaceuticals, which tumbled

even further last week after Goldman Sachs

was forced to dump a block of about 1.3 million

shares. This development came amidst a storm

of controversy related to the Canadian drug-

makers reliance on borrowing, aggressive sales

techniques and high prices. Recent losses

resulted from a margin call by Goldman Sachs

after they were forced to sell off shares which

were owned by Michael Pearson, Valeant's

chief executive. A margin call occurs when the

equity held by an investor falls below a certain

criteria in proportion to the loan made by the

broker. Mr Pearson borrowed money from

Goldman in 2013 by using his nine million

shares in the company as collateral for the loan

and news about the company's practices in

August has greatly impacted the personal

wealth of Mr Pearson. Despite rising more than

900% from 2010 up to its peak at the end of

July, huge volumes of shares were dumped last

Thursday sending the share price tumbling by

14% at the end of the day and 20.3% in the first

hour of trading, as shown by the graph below.

Further news affecting Valeant and the industry

in general reveals that Republicans are

blocking the ability for the Democrats to

investigate drug price hikes. Even though the

senate has started probing companies such as

Valeant and Turing, there would have to be a

wider bipartisan push, especially in the House.

Last Wednesday the Republican chairman of

the House Oversight Committee, Jason

Chaffetz from Utah, had rebuffed any efforts to

investigate this matter. In the meantime,

Pharma companies can continue profiteering

and hence investors should remain confident in

the face of this political neglect.

Sam Hillman

Valeant Pharmaceuticals Intl Inc


21

Industrials & Basic

Materials

The benchmark 30-member Philadelphia Stock

Exchange Gold and Silver Index, which

includes mining companies such as Barrick

Gold Corp and Newmont Mining Corp, fell to its

lowest since September 2000. Gold’s 42%

slump from a record set four years ago is cutting

profits and stressing balance sheets for mining

companies, with the largest producers weighed

down by debt loads totalling almost $35 billion.

Randgold Resources Ltd., the best-performing

producer of the metal in the past decade, says

that the biggest gold miners, weighed down by

record debt and prices near a five-year low, will

have to merge with others to survive in such a

climate. Randgold, which has advanced more

than fourfold in London trading over the past 10

years, has so far avoided the worst of the

turmoil that’s forced producers to reduce asset

values and raise cash. Barrick on the other

hand is seeking to sell its mines to cut its debt

and they have discussed with Randgold on the

possibility of combining their operations several

times over the past two decades. Both

companies blamed each other for the

breakdown in the latest merger talks in April last

year.

Randgold is also currently examining

AngloGold Ashanti Ltd.’s Obuasimine in

Ghana, with the option to revive if the company

thinks it can become profitable. This

redevelopment would cost Randgold about

$500 million, which could be paid for without

raising debts or selling of shares. The strong

financial position of Randgold is evident where

they can build a new mine on their own

comfortably. With such a strong financial

standing, Randgold is on the lookout for other

projects to buy, but has been frustrated by

companies excessively pricing assets.

As the price of gold weakens, profit margins of

miners similarly contract. Moreover, higher

lending rates in coming months should similarly

keep the commodity in check, leading to further

weakness among miners. Also, the falling

operating margins of producers give investors

fundamental reason for not owning the sector.

Furthermore, as lending rates should support

the dollar, gold prices will be capped in the near

future.

Gold also dropped for the sixth straight session

and one-month low on Wednesday, as the

dollar shot to a three-month high after US

Federal Reserve Chair Janet Yellen raised

expectations for a December interest rate

increase.

Erwin Low

NEFS Market Wrap-Up

22

COMMODITIES

Energy

It’s been another tough week for energy prices

as markets still attempt to adjust to the current

supply conditions. WTI Crude Oil has fallen

2.4% after some initial price growth earlier in the

week, while Gasoline has not been faring any

better, dropping a similar 2.5%. This has come

as better-than-expected monthly data on US

employment helped to strengthen the US dollar.

In addition, Ethanol – a commodity commonly

used as a fuel when mixed with Gasoline – also

fell sharply by 4.3% over the past 7 days as a

reaction to the drop in Gasoline has reduced

aggregate demand for Ethanol in the economy.

In complete contrast, there was an unlikely

shining light amid the gloom this week - Natural

Gas.

Natural Gas prices have increased this week,

as shown in the graph below. After prices rallied

on Thursday they have finished +1.7% for the

week after data showed a smaller-than-

expected weekly climb in US inventories. But

what makes this even more unlikely is the fact

that total supplies are matching a record level

set three years ago. Total supplies now stand

at 3.929 trillion cubic feet - tying the record

reached for the week ended Nov. 2, 2012,

according to data by the US Energy Information

Administration (EIA).

At first look this price rise seems confusing, but

the key lies in the current time of year. To

understand this correctly I believe an analogy is

needed; Gandalf the White in the “Lord of the

Rings” novels remarks to Pippin, his

companion, of the great battle ahead; “It’s the

deep breath before the plunge” he warns darkly

as they stare at the bleak lands of Mordor. This

situation is comparable to what is happening in

the Natural Gas market. The market refers to

the period as “injection season”, the period

during which natural-gas supplies build up in

preparation for a winter-related spike in heating

demand over the coming months. It is, as

Gandalf would have said, the “deep breath” of

increased demand to have a reserve of Gas

“before the plunge” of winter.

Do not expect these price rises to last however.

With supplies at a record level, Gas inventories

will soon fill up and demand will ebb away until

winter hits the northern hemisphere (and its

biggest consumer, the US). In the future, the

extent of supply must surely result in price falls,

but for now at least, Natural Gas is looking

bright.

Harry Butterworth


23

Precious Metals

This week we have seen Janet Yellen’s

remarks on the increased chances of a Federal

Reserve interest rate from 46% to 58% this

December which played a significant role in the

global economy as the dollar strengthens

against the emerging market currencies. Gold

prices have hit a seven week low as it has fallen

from 1146.77 USD/oz. to 1103.99USD/oz., a

3.7% drop this week.

The gold prices this week have been pushed

down further as the Fed signalled a possible

December interest rate hike, but this fluctuation

and guessing game of when the Fed would

actually make this decision have hampered

gold’s ability to gain any traction. The prospect

of a stronger dollar as seen from the Dollar Spot

Index (See chart below), which is inversely

related to the prices of gold, has also added to

the sell-off of gold and perhaps not until the Fed

is satisfied with the inflation and unemployment

rate that the actual decision of the raise in

interest rate would be made.

Silver has also plunged dramatically this week

as it posts a 2 month dip by just under a 6%

drop in prices. The two metals Gold and Silver

have been pressured greatly by the speculation

of the Fed’s decision, and Silver being the more

volatile metal, would take a greater hit and is

currently under a higher risk. Copper prices

have also fallen this week from 2.36 USD to

2.25 USD this week and this can be attributed

to the drop in demand from the top consumer,

China, whose growth has slowed in recent

times.

In other news, investors have dumped a

significant amount of platinum and palladium

from funds backed by the metals last month on

concern that demand will ease in the aftermath

of the Volkswagen AG emissions scandal.

Platinum has fallen from 989.40 USD to 947.99

USD this week and Palladium has also fallen

from 672.99 USD to 605.37 USD. The two

metals have a combined drop of over 14% this

week.

Given that the Feds seem to be hawkish, the

increase in headwinds to the global economy,

and the decrease in demand for precious

metals by one of the world’s largest consumer,

China, there is a bearish outlook towards the

precious metals sector. Look out for the Fed’s

meetings, the US dollar index and the global

economy this week to make a more informed

decision on the prices this week.

Samuel Tan

Dollar Spot Index

Gold Price Trend

NEFS Market Wrap-Up

24

Agriculturals

Over the last couple of weeks, agricultural

industry proved to be heavily dependent on

relatively poor weather conditions. Low rainfall

in California and South Africa remains an

important issue to global markets but, this this

week we look at the causes behind the price

depreciation in rubber and milk produce.

Rubber prices are steadily slumping down. The

Tokyo and Thailand rubber industries

experienced a steady decrease in demand in

the last 6 years, closely followed by declines in

prices. From the maximum value of $1743/bu in

2011 rubber prices depreciated to $505/bu by

4th November. This effect came as China, the

main buyer of the good, slowed the demand for

the good, alongside a number of other

purchasers. According to Geofin Research,

Kochi, the national Thailand Rubber Policy

Committee concluded that the government will

try to increase local consumption and expect

prices to rise gradually. This Wednesday’s

overview by Janet Yellen, Federal Reserve

Chair, is expecting a slow price recovery in

December.

Similarly, milk and related goods industry is still

expanding and the surplus of the produced

goods is significantly exceeding demand. Even

though New Zealand is producing much less

milk in 2015 (and is expected remain producing

less in 2016), the decline in regional supply is

still compensated by the growing supply from

Europe. This year the cooler weather from June

to September was provided unfavourable

conditions to grow the feed for the ruminants in

New Zealand. Furthermore, excessive supply

from European countries lowered the

profitability of production in New Zealand and,

consequently, discouraged many farmers from

producing the same level. As evident in the

Figure below, recent milk prices peaked on the

20th June to $17.70/bu and shrank to $15.31/bu

by the beginning of November. For the time

being, the revenue accumulated from sold

goods just covers the cost of production.

However, the graph below also shows a slight

increase in the price to $15.63/bu since 1st

November. This Monday Dairy Today’s Elite

Producer Business conference was hosted in

Las Vegas with Tim Hunt, a respected dairy

strategist, being the guest speaker. He

reflected on today’s milk prices and forecasted

sustained growth in appreciation of the good by

summer 2016.

The explanation provided by the economist

relies on the assumption that low current prices

may ‘unlock additional consumption, eroding

those international stocks’. While this opinion

remains questionable, the pattern for the future

(due to dependency on interrelated factors, e.g.

weather, global demand and production in

neighbouring regions) is difficult to spot yet.

Goda Paulauskaite


25

CURRENCIES

Major Currencies

Despite manufacturing activity in the US

expanding at the slowest rate in more than 2

years in October, casting doubt over the

strength of the economy, EUR/USD largely

traded flat in the beginning of the week. Better

than forecast US employment change (182k v

180k) helped push the Euro to new lows on

Wednesday afternoon, which was further

damaged when the non-manufacturing

composite was released 2 hours later. Service

sector activity in the US grew ahead of forecast,

coming in at 59.1 (compared to the 56.5

forecast). This erased fears established earlier

in the week and saw the bears battle back as

the market continued to sell off the euro,

pushing it down to the 1.085 level.

With Non-farm payrolls forecast to increase by

40k, and unemployment to remain flat, I believe

the market is poised for a further major sell off,

which will continue to push the currency down

to levels not seen since 2003.

This week I have used technical analysis to

support my fundamental view on EUR/USD;

using Bollinger Bands and a 30/20/10 period

simple moving average. Both are useful for

identifying trends in markets. It is clear from the

SMA analysis in chart 1 that EUR/USD appears

to be in a downward trend; as even the 30 day

and 20 day averages (the slowest to react to

price changes) are now entering a downward

curve. Chart 2, depicting the Bollinger bands,

gives further support to this view. The price has

remained below the 10 day SMA for 15 trading

days now, so we can be confident that

EUR/USD is trending downwards. Furthermore,

the price has just crossed over the lower band

today (5th November); this is an extreme event

that happens rarely, I believe this is a

continuation signal which indicates strength in

the trend. If you look at October 22nd when this

last happened, you can see the price rapidly

dropped over the next week.

With non-farm payrolls and unemployment

figures released we will certainly see a spike of

volatility in EUR/USD, and if the results come in

as forecast there will be a further sell off in the

pair. The technical analysis supports this view

and indicates that the pair is currently on a

downward trend – combining these factors

together I believe they will be pushed down to

new lows and will most likely find support at the

1.07 level. Strong short recommendation.

Adam Nelson

NEFS Market Wrap-Up

26

Minor Currencies

The New Zealand dollar performed poorly this

week against all major currencies; most

markedly against the US dollar, falling just over

4% from the week’s opening price to the week’s

close.

The Kiwi US dollar pair (NZD/USD) started

trading this week around the top of the 0.665,

0.680 range, but this changed early on in

Tuesday’s trading as New Zealand’s GDT Price

Index was released. The GDT Price Index is the

weighted average of the 9 dairy products that

are sold at auction. Dairy prices fell 7.4% over

the last 2 weeks after dropping 3.1% in the 2

weeks previous to this. Dairy exports are a

relatively large proportion of New Zealand’s

exports, and so, if dairy products fall in value,

demand for Kiwi dollar reduces, as less of the

currency is needed to buy the products.

The downtrend in the NZD was continued later

on on Tuesday when poor employment data

was released. Unemployment remained

constant at 6.0% but employment fell 0.4% from

the previous quarter. The news caused the

currency to continue falling into Wednesday

where it managed to break through the previous

significant resistance line at 0.665. The pair

then became a lot less volatile and traded within

a tight range with NZD attempting to stage a

rally mid Thursday that was quickly crushed.

The sharp down candle on Friday was due to

the strong US non-farm payrolls report but the

pair failed to decline any further, meeting heavy

resistance at the 0.650 price.

Next week there is no major news to come out

of New Zealand. Consequently, the pair should

trade within a range where 0.650 will be a highly

significant support price as it has been in

previous weeks. Resistance should be found

around the 0.660 level.

Elsewhere in Australasia, the Reserve Bank of

Australia held its monetary policy meeting. The

RBA decided to keep interest rates at record

lows of 2%. The reason for not cutting rates any

further was given as the ‘firming’ economic

conditions. Prior to the meeting, the market had

odds of further rate cuts at 45%. The meeting

caused the Australian dollar to strengthen by

around 1% but these gains were lost later on in

the week.

Will Norcliffe-Brown

NZD/USD 1 hour candlestick (Source: OANDA)


27

About the Research Division The Research Division was formed in early 2011 and is a part of the Nottingham Economics and Finance Society (NEFS, formerly known as NFS and UNIS). It consists of teams of analysts closely monitoring particular markets and providing insights into their developments, digested in our NEFS Weekly Market Wrap-Up. The goal of the division is both the development of the analysts’ writing skills and market knowledge, as well as providing NEFS members with quality analysis, keeping them up to date with the most important financial news. We would appreciate any feedback you may have as we strive to grow the quality and usefulness of weekly market wrap-ups.

For any queries, please contact Josh Martin at [email protected]. Sincerely Yours, Josh Martin, Director of the Nottingham Economics & Finance Society Research Division

This Publication has been prepared solely for informational purposes, and is not an offer to buy or sell or a solicitation of an offer to buy or sell any security, product,

service or investment. The opinions expressed in this Publication do not constitute investment advice and independent advice should be sought where appropriate.

Whilst reasonable effort has been made to ensure the accuracy of the information contained in this Publication, this cannot be guaranteed and neither NEFS nor any

other related entity shall have any liability to any person or entity which relies on the information contained in this Publication, including incidental or consequential

damages arising from errors or omissions. Any such reliance is solely at the user’s risk.

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About the Research Division The Research Division was formed in early 2011 and is a part of the Nottingham Economics and Finance Society (NEFS, formerly known as NFS and UNIS). It consists of teams of analysts closely monitoring particular markets and providing insights into their developments, digested in our NEFS Weekly Market Wrap-Up. The goal of the division is both the development of the analysts’ writing skills and market knowledge, as well as providing NEFS members with quality analysis, keeping them up to date with the most important financial news. We would appreciate any feedback you may have as we strive to grow the quality and usefulness of weekly market wrap-ups. For any queries, please contact Jack Millar at [email protected] Sincerely Yours, Jack Millar, Director of the Nottingham Economics & Finance Society Research Division

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NEFS Market Wrap Up Week 3