MARKET RESEARCH

Mar 10th Mar 14th

SPOTLIGHT
Portuguese Balance of Trade (in millions of )

Political tension in Crimea pressures PSI20

Last week, PSI20 tumbled, after the political situation in Crimea did not improve. Official data released by Banco de Portugal showed that the structural unemployment in Portugal increased to 11.7% in 2013. According to data released by INE, Portuguese GDP grew 1.7% (YoY) in the last quarter of 2013 (this figure was revised up from 1.6%). The main contributor to this growth was the domestic demand (+0.1%), with consumer spending increasing 0.7% (YoY). Moreover, the countrys trade balance fell by 300 million (YoY) on January, as exports increased 2.3% (YoY), while imports grew 9.3% (YoY). Finally, consumer prices fell 0.1% (YoY) on February 2014, as transportation and clothing prices declined.

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INDEXES PERFORMANCE
Mar 10
PSI 20 STOXX 50 FTSE 100 DAX CAC 40 NIKKEI 225 HANG SENG
7,567.99 3,092.79 6,689.45 9,265.50 4,370.84 15,120.14 22,264.93

Mar 11
7,641.78 3,092.55 6,685.52 9,307.79 4,349.72 15,224.11 22,269.61

Mar 12
7,516.24 3,065.46 6,620.90 9,188.69 4,306.26 14,830.39 21,901.95

Mar 13
7,353.57 3,019.54 6,553.78 9,017.79 4,250.51 14,815.98 21,756.08

Mar 14
7,317.03 3,004.64 6,527.89 9,056.41 4,216.37 14,327.66 21,539.49

Wkly Chg
-2.11% -2.93% -2.75% -3.15% -3.44% -6.20% -4.95%

Crimea tension weighs on European stocks

European stock markets declined last week, with STOXX50 slipping 2.93%, as investors remained concerned over a political standoff in Crimea. According to Research Group Sentix, investor confidence in the euro zone rose to 13.9 in March, from 13.3 on February, the highest level since April 2011, easing concerns over the outlook for the regions economy. Moreover, according to Eurostat, industrial production in the euro zone fell unexpectedly in January (-0.2%). Finally, according to the Spanish National Institute of Statistics, retail sales rose at an annualized rate of 0.5%, from the -1.0% one registered in February.

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CURRENCIES
Mar 10
EUR/USD EUR/CHF EUR/GBP EUR/JPY EUR/YUAN AUD/JPY
1.388 1.218 0.834 143.280 8.519 93.150

Mar 11
1.386 1.216 0.834 142.520 8.507 92.200

Mar 12
1.390 1.215 0.837 142.940 8.545 92.510

Mar 13
1.387 1.213 0.834 141.120 8.508 91.890

Mar 14
1.391 1.214 0.836 141.020 8.554 91.500

Wkly Chg
0.26% -0.36% 0.66% -1.58% 0.65% -2.31%

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REFERENCE RATES
Mar 10 Euribor 1M Euribor 3M Euribor 6M Euribor 12M Eonia 0.236% 0.307% 0.408% 0.578% 0.167% Mar 11 0.233% 0.304% 0.405% 0.575% 0.171% Mar 12 0.233% 0.304% 0.405% 0.574% 0.172% Mar 13 0.230% 0.304% 0.405% 0.573% 0.170% Mar 14 0.230% 0.303% 0.402% 0.570% 0.158%

Asian stocks slide to a one-month low

Asian stocks fell, as worries over slowing growth and recent corporate bond defaults on China dented investor appetite for risk. Chinese trade balance turned into a USD 22.9 billion deficit in February of 2014, as exports tumbled 18% (YoY). In contrast, imports rose by a better-than-expected 10.1% (YoY). Moreover, Chinese annual inflation rate slowed to 2% in February, its lowest rate in 13 months. Cost of fruit recorded the highest increase, 19.7%, while prices of non-food products decelerated by 1.6%. Japans economy grew 0.7% (YoY) in Q4 of 2013, revised down from 1% due to a slowdown in capital spending and private consumption. On March 11th, BOJ decided to do not change its monetary policy. Australias unemployment rate stayed at 6% last month as more people joined the labor force. Moreover, consumer confidence deteriorated and home loans stagnated.

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BOND YIELDS
Mar 10 Portugal 6M Portugal 5Y Portugal 10Y Spain 10Y France 10Y Italy 10Y Germany 10Y UK 10Y 0.611% 3.372% 4.455% 3.307% 2.203% 3.371% 1.628% 2.797% Mar 11 0.450% 3.357% 4.398% 3.325% 2.224% 3.400% 1.639% 2.780% Mar 12 0.653% 3.532% 4.515% 3.350% 2.187% 3.417% 1.597% 2.750% Mar 13 0.599% 3.653% 4.618% 3.344% 2.139% 3.397% 1.548% 2.694% Mar 14 0.639% 3.557% 4.617% 3.344% 2.126% 3.408% 1.547% 2.664%

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SPOTLIGHT
U.S. Producer Price Index Growth Rate (MoM)

U.S. indexes tumbled again

U.S. stocks suffered the biggest loss last week, since January, as mounting tensions in Ukraine, and signs of a slowdown in China, overshadowed reports showing an improving American economy. On the economic front, U.S. retail sales rose 0.3% in February, beating expectations for a 0.2% increase. Moreover, the number of Americans filing for unemployment benefits unexpectedly dropped to the lowest level since the end of November. On the other hand, according to Thomson Reuters/University of Michigan, consumer confidence in the U.S. declined to 79.9 in March, from 81.6 in February, indicating a fragile household spending from a weather-related setback earlier this year. Besides, producer prices dropped 0.1% last month, due to the biggest decrease in the cost of services in almost a year.

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INDEXES PERFORMANCE
Mar 10
S&P 500 DJIA NQ 100 S&P Lac 40
1,877.17 16,418.68 3,706.34 3,280.86

Mar 11
1,867.63 16,351.25 3,691.50 3,269.24

Mar 12
1,868.20 16,340.08 3,707.06 3,282.17

Mar 13
1,846.34 16,108.89 3,651.49 3,242.51

Mar 14
1,841.13 16,065.67 3,627.87 3,234.37

Wkly Chg
-1.97% -2.35% -2.04% -2.88%

Brazilian Retail sales surprisingly increase

Brazilian retail sales rose unexpectedly in January on strong demand for food, fuel and furniture. Brazils retail sales increased 0.4% in January, from the previous month, while the median estimates were for a decline of 0.3%. Compared with January of 2013, retail activity grew 6.2%. Moreover, consumer price inflation in Brazil rose to 5.68%, from 5.59% in the preceding month. Analysts had expected Brazilian CPI to rise to 5.64% last month. In Mexico, industrial production rose 0.7% in January, compared to the year-earlier month, beating expectations of a 0.3% increase and kicking off the year on a positive note after 2013's poor result.

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CURRENCIES
Mar 10
USD/JPY USD/YUAN AUD/USD GBP/USD USD/CHF USD/CAD
103.260 6.139 0.902 1.664 0.878 1.112

Mar 11
102.860 6.141 0.896 1.662 0.878 1.111

Mar 12
102.830 6.145 0.900 1.662 0.874 1.112

Mar 13
101.780 6.136 0.903 1.662 0.875 1.108

Mar 14
101.350 6.149 0.903 1.665 0.872 1.111

Wkly Chg
-1.85% 0.35% -0.42% -0.41% -0.64% 0.16%

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COMMODITIES
-3.50% -4.39% -0.46% -0.46%
Crude Oil WTI Natural Gas Crude Oil Brent Corn

3.21% 2.57% -4.61% -3.57%

Gold Silver Copper Sugar

Gold rose over US and Russian Standoff

Gold prices ended the week with a gain amid heightened tensions between Russia and the U.S. over Russia's involvement in Ukraine's political crisis, and due to a weaker than expected U.S. consumer confidence data. On the energy front, Oil prices dropped amid concerns over a slowdown in demand in the U.S. and China, the largest and second-largest oil consumers. In what concerns metals, Copper dropped as concerns over the health of Chinas economy dampened demand for growth-linked assets. Finally, Sugar prices showed the biggest slump in more than a year, as increased rainfall eased the outlook for production losses in Brazil.

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US TREASUR Y YIELDS
Mar 10 US 3M US 1Y US 10 Y US 30 Y 0.048% 0.127% 2.779% 3.723% Mar 11 0.051% 0.124% 2.770% 3.710% Mar 12 0.046% 0.119% 2.732% 3.674% Mar 13 0.046% 0.119% 2.645% 3.591% Mar 14 0.046% 0.119% 2.656% 3.600%

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Ana Reis

Beatriz Fougo

David Novo

Jos Silva

Pratik Ashok

Pedro Santos

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