Commodity Market Stable Amid Continued Macroeconomic Uncertainty in November

 Commodity Market Stable Amid Continued Macroeconomic Uncertainty in November

PR Newswire

NEW YORK, Dec. 12, 2012

NEW YORK, Dec. 12, 2012 /PRNewswire/ --Commodities were relatively unchanged
in November as continued macroeconomic uncertainty weighed on markets.

(Logo: http://photos.prnewswire.com/prnh/20091204/CSLOGO )

Nelson Louie, Global Head of Commodities in Credit Suisse's Asset Management
business, said, "Market attention remained on US fiscal negotiations at the
end of November. While a deal had yet to be made to avert the Fiscal Cliff,
it was clear negotiations between the Republican-controlled House of
Representatives and the President's office were active. What a final deal
will look like and when it will be passed is still highly uncertain. Also,
Eurozone leaders agreed to release the next tranche of aid to Greece in
December, cooling imminent Greek concerns. However, worries over the outlook
for Europe in general remain heightened and will likely to continue to feature
in the headlines and market activity in the future. Meanwhile, there were
continued signs of economic recovery reported during the month of November out
of China and the US."

Christopher Burton, Senior Portfolio Manager for the Credit Suisse Total
Commodity Return Strategy, added, "There are clearly signs of economic
recovery while much uncertainty and potential headwinds remain. As a result,
major central banks have generally continued to pursue their exceptionally
loose monetary policies in an effort to provide ongoing support to nascent
recoveries. Inflation may overshoot expectations if economic activity begins
to pick up more robustly than expected or capital markets begin to react to
negative real rates with capital outflows and currency depreciation. This
scenario could be beneficial for those who use commodities as an inflation
hedge."

The Dow Jones-UBS Commodity Index Total Return was up by 0.05% in November.
Overall, 12 out of 20 index constituents posted positive returns. Industrial
Metals was the best performing sector, up 6.99% for the month. China's
manufacturing Purchasing Managers Index ("PMI") readings continued to suggest
recovery and expansion, reversing the summer decline. Base metals were also
supported by US October housing starts, reported at their highest level since
2008, being above expectations. Livestock increased 1.48%, led by Lean Hogs,
as a result of unexpected gains in pork cutout prices during a time of
typically sluggish demand. Hog futures tend to dip at the beginning of
November on weakening seasonal demand, as consumers turn to turkey and other
meat proteins near the holidays. Precious Metals was relatively unchanged, up
0.25%, as ongoing concerns over Greece and Europe, along with the Fiscal Cliff
debate, contributed to heightened volatility in currencies and precious
metals. Energy decreased 1.14%, led lower by Natural Gas. However, crude oil
and petroleum products increased after a volatile month with market sentiment
closely following the Gaza conflict and the subsequent ceasefire.
Expectations that Greece would be able to avoid near-term bankruptcy
brightened the outlook for oil demand from Europe. Agriculture decreased
2.81%. Soybeans remained under pressure following the release of the November
USDA monthly World Agriculture Supply and Demand report. Grains were
generally weaker amid increased expectations for global supply.

About the Credit Suisse Total Commodity Return Strategy

Credit Suisse's Total Commodity Return Strategy has been managed for 18 years
and seeks to outperform the return of a commodities index, such as the Dow
Jones–UBS Commodity Index Total Return or the S&P GSCI Total Return Index,
using both a quantitative and qualitative commodity research process.
Commodity index total returns are achieved through:

  oSpot Return: price return on specified commodity futures contracts;
  oRoll Yield: impact due to migration of futures positions from near to far
    contracts; and
  oCollateral Yield: return earned on collateral for the futures.

As of November 30, 2012 the team managed approximately USD 10.8 billion in
assets globally.

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This document was produced by and the opinions expressed are those of Credit
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Certain risks relating to investing in Commodities and Commodity-Linked
Investments: Exposure to commodity markets should only form a small part of
a diversified portfolio. Investment in commodity markets may not be suitable
for all investors. Commodity investments will be affected by changes in
overall market movements, commodity volatility, exchange-rate movements,
changes in interest rates, and factors affecting a particular industry or
commodity, such as drought, floods, weather, livestock disease, embargoes,
tariffs and international economic, political and regulatory developments.
Commodity markets are highly volatile. The risk of loss in commodities and
commodity-linked investments can be substantial. There is generally a high
degree of leverage in commodity investing that can significantly magnify
losses. Gains or losses from speculative derivative positions may be much
greater than the derivative's original cost. An investment in commodities is
not a complete investment program and should represent only a portion of an
investor's portfolio management strategy.

Copyright © 2012, CREDIT SUISSE GROUP AG and/or its affiliates. All rights
reserved.

SOURCE Credit Suisse AG

Website: http://www.credit-suisse.com
Contact: Press, Katherine Herring, Corporate Communications, +1-212-325-7545,
katherine.herring@credit-suisse.com
 
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