NEW YORK, April 11, 2018 /PRNewswire/
-- Commodities declined in March amid shifting supply and
demand expectations across multiple sectors.
The Bloomberg Commodity Index Total Return performance was lower
for the month, with 15 out of 22 Index constituents posting
losses.
Credit Suisse Asset Management observed the following:
- Livestock declined 7.07%, led lower by Live Cattle, after the
USDA reported higher beef production in March compared to the year
prior as well as higher-than-expected feedlot placements in
February, increasing supply expectations.
- Industrial Metals decreased 4.36% as US-imposed tariffs on
steel and aluminum products along with a cooling Chinese housing
market reduced demand expectations for base metals.
- Agriculture was 2.81% lower. Kansas City Wheat and Chicago
Wheat both fell as much needed rainfall in the US Grain Belt
relieved parched crops, improving yield expectations.
- Precious Metals increased 0.15%, led higher by Gold, after
trade tensions between the US and China rose, raising safe haven demand for the
metal.
- Energy rose 4.87%, led higher by crude oil and petroleum
products, as new appointments by the US Administration increased
the odds of Iran and Venezuela facing more US sanctions,
potentially reducing the amount of crude oil supply in
circulation.
Nelson Louie, Global Head of
Commodities for Credit Suisse Asset Management, said: "March began
with the US government announcing across-the-board tariffs on steel
and aluminum product imports, upsetting many countries, including
long-standing trading partners such as the European Union. Though
the US administration eventually made exceptions, retaliatory
actions by targeted nations are largely expected. China already announced plans to impose
tariffs on US pork, with expectations of more levies to come. While
the trade actions intend to safeguard their respective nations, the
escalating tensions may have the unintended effect of hurting
specific producers, such as US soybean farmers. Further escalation
of trade tensions may have the potential to affect growth."
Christopher Burton, Senior
Portfolio Manager for the Credit Suisse Total Commodity Return
Strategy, added: "In March, on the back of a stronger US economy,
the Fed raised rates and also indicated it may increase the pace of
interest rate hikes to prevent the economy from overheating as
signs of inflation continue to emerge. The ECB announced plans to
begin to tighten its monetary policies on the back of improving
labor markets and strengthening economic growth. As China and Japan's core CPI readings for February reached
new year-over-year highs, increasing industrial output may serve as
a sign of future inflationary pressures. Increasing coordination in
global growth as well as rising inflationary pressures may be more
supportive for commodities as an asset class."
About the Credit Suisse Total Commodity Return
Strategy
Credit Suisse's Total Commodity Return Strategy is
managed by a team with over 32 years of experience, and seeks to
outperform the return of a commodities index, such as the Bloomberg
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:
- Spot Return: price return on specified commodity futures
contracts;
- Roll Yield: impact due to migration of futures positions from
near to far contracts; and
- Collateral Yield: return earned on collateral for the
futures.
As of March 31, 2018, the Team
managed approximately USD 8.8 billion
in assets globally.
Press Contact
Candice
Sun, Corporate Communications, +1 (212) 325-8226,
candice.sun@credit-suisse.com
Credit Suisse AG
Credit Suisse AG is one of the
world's leading financial services providers and is part of the
Credit Suisse group of companies (referred to here as 'Credit
Suisse'). As an integrated bank, Credit Suisse offers clients its
combined expertise in the areas of private banking, investment
banking and asset management. Credit Suisse provides advisory
services, comprehensive solutions and innovative products to
companies, institutional clients and high-net-worth private clients
globally, as well as to retail clients in Switzerland. Credit Suisse is headquartered in
Zurich and operates in about 50
countries worldwide. The group employs approximately 46,840 people.
The registered shares (CSGN) of Credit Suisse's parent company,
Credit Suisse Group AG, are listed in Switzerland and, in the form of American
Depositary Shares (CS), in New
York. Further information about Credit Suisse can be found
at www.credit-suisse.com.
Important Legal Information
This document was
produced by and the opinions expressed are those of Credit Suisse
as of the date of writing and are subject to change. It has been
prepared solely for information purposes and for the use of the
recipient. It does not constitute an offer or an invitation by or
on behalf of Credit Suisse to any person to buy or sell any
security. Any reference to past performance is not necessarily a
guide to the future. The information and analysis contained in this
publication have been compiled or arrived at from sources believed
to be reliable but Credit Suisse does not make any representation
as to their accuracy or completeness and does not accept liability
for any loss arising from the use hereof.
Certain information contained in this document constitutes
"Forward-Looking Statements" (including observations about markets
and industry and regulatory trends as of the original date of this
document), which can be identified by the use of forward-looking
terminology such as "may", "will", "should", "expect",
"anticipate", "target", "project", "estimate", "intend", "continue"
or "believe", or the negatives thereof or other variations thereon
or comparable terminology. Due to various risks and uncertainties
beyond our control, actual events, results or performance may
differ materially from those reflected or contemplated in such
forward-looking statements. Readers are cautioned not to place
undue reliance on such statements. Credit Suisse has no obligation
to update any of the forward-looking statements in this
document.
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 © 2018, CREDIT SUISSE GROUP AG and/or its affiliates.
All rights reserved.
View original content with
multimedia:http://www.prnewswire.com/news-releases/commodities-declined-amid-shifting-supply-and-demand-expectations-300627966.html
SOURCE Credit Suisse AG