@McGill Engineering Investment Group

2013-02-23 Volume 1, Issue 6

Inside this issue

Latest Updates ............... 1 Rates & FX ...................... 2 Technology .................... 3 Commodities .................. 4

Newsletter
Latest Updates
Come join the EIG this Thursday February 28th at 6:00 pm as we present to you the first in a series of informative tutorial sessions led by industry professionals. Our first session will go over the basics and no prior knowledge is required! The presentation will mainly focus on the core concept of value, the functioning and purposes of different financial products. For more information regarding the event, please visit the link below: http://www.facebook.com/events/418699624887554/?ref=22 Free Pizza will also be served. We hope to see you all there!

Disclaimer ...................... 5 Upcoming Events

EIG Tutorial Session

We would also like to extend a special thanks to our sponsor BMO Capital Markets for supporting the group!

Market Analysis
Rates & Foreign Exchange

Rates & Foreign Exchange

Canada January inflation lowest in 3 years [Yahoo]

Canadas annual inflation rate held at 0.5% from 0.8% in December, lowest level since 2009 This is largely due to gasoline prices which fell 1.8% YoY Although there have been talks for nearly a year now of the Bank raising the overnight rate, this most recent figure shines the light on how little pressure there actually is in the market to raise the rates.

Bernanke reportedly brushes off bubble talk [MarketWatch]

A key concern coming out of the minutes of the last Fed meeting was that the latest monetary policies were creating an asset bubble Bernanke reportedly brushed off such talk at a meeting held prior this month with dealers and investors

Eurozone economy to shrink again in 2013 [CNNMoney]

The European commission announced on Friday it expected combine GDP of the combined 17 Eurozone members to contract by 0.3% this year GDP shrank for a third consecutive quarter leaving it 0.6% smaller than at the start of the year This will make it harder for governments to reduce borrowing costs and promises more misery for millions of unemployed

U.S. Stocks Rise on German Business Confidence, Earnings [Bloomberg]

German business confidence jumped to a 10-month high on better than expected corporate earnings S&P 500 rose 0.4% as of 9:50 a.m. EST on Friday morning

Canada retail sales unexpectedly drop 2.1% in December [Reuters]

Technology

Technology
Hewlett-Packard Outperforms
Hewlett-Packard Co shares rose 11 percent on Friday following the release of the companys quarterly results which topped investors expectations and forecasts. HP shares have consistently outperformed all other Dow Jones Industrial Average constituents this year and closing on Friday with $19.20, the highest since August last year. More than eight brokerages raised HPs target stock prices by an average of $4.19, including J.P. Morgan Securities analyst Mark Moskowitz, raising the stocks target price to $22.

Prospect for Compuware

Compuware Corp, a business software maker based in Detroit, has held talks with several private equity firms such as Blackstone Group LP, TPG Capital LP and Golden Gate Capital, about a potential deal after rejecting an $11 per share offer from New York hedge fund Elliot Management Corp in early January. Compuware Corp is currently valued at around $2.5 billion and is being advised by investment bank Goldman Sachs Group Inc and Allen & Company regarding potential offers from PE firms. The companys diverse business lines make it difficult for other industrial competitions to target.

Commodities

Commodities
Gold continues to fall [WSJ]
Gold fell to $1572.40 per troy ounce, down 2.3% this past week, 6.1% for the year and 12% from its 12week high Investors are worried that the Federal Reserve may tighten its monetary policies soon

Petroleum ends slide and gasoline prices remain high [Transport Topics Online]
After dropping $4 over two days to a year low of $92.84, the price of crude oil recovered slightly to $93.13 a barrel While crude oil inventories rose, gas and diesel inventories dropped more than expected As a result, fuel (particularly diesel) prices in the States remain high

Cold weather heats up natural gas prices [Reuters]

With weather forecasts continuing to predicting cold weather and winter storms across the States, natural gas future price rose on the expectation that demand will rise Nuclear plant power outages have also supported increased demand

Crop prices march higher [Economist]

A combination of last years drought shrinking supply, strong demand boosted by a growing biofuel industry, and high prices for commodities have fueled record prices for crops. Farm profits are expected to rise 14% this year The price of farmland in the Midwest region of the US raised 16% last year

Soybeans continue to rally but rubber plummets [Bloomberg] 4

McGill EIG
The McGill Engineering investment Group is a new engineering studentrun club that intends to educate engineering and non engineering students about the capital markets and the finance world as a whole. The club also aims to bridge the gap between theory and practice by organizing various events with people from the industry. In addition, EIG is in the process of building an investment portfolio that will be entirely managed by members of the group. For more info on our future events and activities, like our Facebook page and follow us on Twitter at @EIGNews.

Disclaimer
The information contained in any newsletter does not constitute an offer to sell securities or the solicitation of an offer to buy, or recommendation for investment in, any securities within Canada or any other jurisdiction. The information in any newsletter is not intended as financial advice. Moreover, none of the newsletter is intended as a prospectus within the meaning of the applicable laws of any jurisdiction and none of the newsletter is directed to any person in any country in which the distribution of such research report is unlawful. Any newsletter provides general information only. The information and opinions in each newsletter constitute a judgement as at the date indicated and are subject to change without notice. The information may therefore not be accurate or current. The information and opinions contained in newsletters have been compiled or arrived at from sources believed to be reliable in good faith, but no representation or warranty, express or implied, is made by the @McGill Engineering Investment Group as to their accuracy, completeness or correctness and the @McGill Engineering Investment Group does also not warrant that the information is up to date. Moreover, you should be aware of the fact that investments in undertakings, securities or other financial instruments involve risks. Past results do not guarantee future performance. Please feel free to contact us at vp.comm@mcgilleig.ca for any feedbacks or suggestions regarding our newsletter. In addition, if you would like to opt out from receiving future newsletters, please contact us at the aforementioned email address.

McGill EIG
Primary Business Address McConnell Engineering Building McGill University 3480 University Street Room 7 Montreal, Quebec, Canada H3A 2K6 E-mail: vp.comm@mcgilleig.ca Website: mcgilleig.ca