| CommStock Israel Investor Insights Newsletter
Sunday, December 14, 2008
Kivun Comstock Commodity Mutual Fund……still
the leading Fund in Israel for 2008……up over 20% so far……
http://finance.themarker.com/f/fundQuote.jhtml?secCode=5107966
CommStock Israel Investor
Insights Newsletter
Sunday, December 14th, 2008
The following report has been prepared as a courtesy
to clients of CommStock Trading Ltd. for general informational
purposes only and is not intended to, and should not, be construed
as any recommendation or advice for any specific investment decisions.
If you would like to be added to or removed from this service,
please e-mail: mona@ecommstock.com
1) Dollar mixed against rivals
Greenback tumbles to 13-year low against
Japanese yen as investors respond to uncertainty surrounding
automaker bailout.
By Ben Rooney, CNNMoney.com staff writer
Last Updated: December 12, 2008: 5:36 PM ET
NEW YORK (CNNMoney.com) -- The U.S. dollar was mixed Friday, after
tumbling to a 13-year low versus the yen, as the U.S. government
scrambled to salvage a bailout deal for the nation's ailing automakers.
Japan's yen dragged the dollar to ¥89.42 in early trading,
breaking through the psychologically important ¥90 level for the
first time since 1995. But the dollar regained ground later in
the day to trade at ¥91.13, down from ¥91.61 late Thursday.
Meanwhile, the British pound retreated against the dollar,
while the euro held its ground after a big rally in the previous
session.
The 15-nation euro was trading at $1.3367 from $1.3353.
The pound slid to $1.4944 from $1.5024.
The dollar's narrow range comes as investors responded
to the collapse Thursday night of a proposed $14 billion government
loan package for General Motors and Chrysler.
"The failure of the rescue package for the automakers
was another disappointing outcome," said Gareth Sylvester, currency
strategist at foreign exchange brokerage HiFX. "It creates uncertainty
and that's what's driving the market right now."
General Motors and Chrysler have both said they will
run out of the cash needed to stay in business next year if they
do not receive the government loans they have requested. Investors
worry that a bankruptcy in the auto industry will exacerbate already
rising unemployment and further undermine the economy.
But the market was bolstered by signs that the Treasury
Department may authorize some of the $700 billion bailout passed
in October to help aid the automakers.
Shifting pattern: On Thursday, the
euro jumped 4 cents against the dollar to a high of $1.34, breaking
out of the range it had been in since October.
At the same time, stock prices tumbled, prompting some
analysts to speculate that the correlation between the dollar and
world equity markets was weakening.
The greenback often rallies when stock prices fall as
investors pull out of more risky assets and take shelter in dollars.
Conversely, the dollar often falls when stocks rise, indicating
that investors' appetite for risk has increased.
"The correlation between the currency and equity markets
has been weakening recently," said Steve Malyon, currency strategist
at Scotia Capital in Toronto, in a research report.
However, Malyon notes that the declines in the stock
market in December have been less severe than in previous months.
"This has made it more difficult to determine whether
the dollar retains the safe-haven allure that was so evident in
October and November," Malyon added.
Stocks seesawed Friday as investors responded to the
uncertainty surrounding the automaker bailout. The Dow Jones industrial
average ended up 65 points.
Sylvester thinks the dollar will remain linked with
the stock market. But he added that the swings are likely to be
less dramatic as market volatility subsides.
"Will we see dollar rally as strongly as we've seen
in the past few months, probably not," he said. But the "prolonged
bottoming out process [happening in the stock market] will keep
the dollar buoyed."
2) Commentary by David Zwebner, CEO of CommStock
Trading
Kivun Comstock Commodity Mutual Fund……still the leading
Fund in Israel for 2008……up over 20% so far……
http://finance.themarker.com/f/fundQuote.jhtml?secCode=5107966
U.S. Economy
The December S&P 500 dove lower overnight after talks for the
auto bailout broke down, but bounced back to steady by the end
of the day. Senate Republicans and the United Auto Workers (UAW)
blamed each other for the impasse. A spokesperson said that the
U.S. Treasury will act to prevent the collapse of the Big Three
auto makers.
The U.S. Commerce Department said that retail sales
were down 1.8% in November at $355.7 billion, a little better than
expected, but still very weak.
The U.S. Labor Department said that the producer price
index was down 2.2% in November and up .4% from a year ago. Excluding
food and energy costs, prices were up .1% in November.
Here's a positive surprise: The University of Michigan's
index of consumer sentiment increased from 55.3 to 59.1 in December,
much better than expected. The September eurodollars were down
.03 at 98.33.
Grains and Cotton
The USDA reported that 116,000 tons of U.S. soybeans were sold
to China. March soybeans were down 4.25 cents at $8.562.
According to AgWeb.com, Informa Economics predicted
that corn acres will be down 4% in the spring while soybean acres
will be up 7%. They also expect cotton acres to be down 19% in
2009. March corn was lower overnight, but closed up 22 cents at
$3.735, the highest close in three weeks. March cotton fell 1.03
to 43.43.
Orange juice
As we head into another weekend, the ten day forecast for central
Florida looks safely warm for the citrus crop. March orange juice
was down .55 at 76.55.
Metals
Not surprisingly, March copper fell 8.35 cents to $1.4285 after
talks for the auto bailout broke down last night.
Energies
February crude oil closed down $1.72 at $49.12 after last night's
collapse of the auto bailout. On Wednesday, the U.S. Energy Department
said that gasoline demand over the past four weeks was still
down 3.2% from a year ago, even though prices were down over
50%.
Currencies
Japan's Prime Minister Aso announced a stimulus plan that will
spend 23 trillion yen ($255 billion) to help the economy. The
March yen jumped up .0081 to 1.1004, the highest spot close since
August of 1995, boosted by a dramatic slowdown in several economies
that were out-growing Japan just a few months ago.
1995 in Japan was the year that that the real estate
bubble burst and their deflation woes began. The spot yen hit 1.2600
in April and fell to .7000 just over two years later.
Eurostat reported that industrial output in the Euro
area 15 was down 1.2% in October and down 5.3% from a year ago.
Also, the European Union announced that it would spend 200 billion
euros, roughly 1.5% of their GDP, in an effort to stimulate the
economy. The March euro gained .0058 to $1.3340.
Statistics Canada reported that new vehicle sales were
down .9% in October, but up 1.4% from a year ago - not bad in light
of the economic climate. Also, industrial capacity slipped from
77.7% to 77.4% in the third quarter, the lowest since records began
in 1987.
David Zwebner, CEO
CommStock Trading Ltd.
Tel: +972-(0)2 624-4963
Fax: +972-(0)2 624-4876
www.ecommstock.com
3) A Fan of Forex?
Interested in reading perspectives and analyses on the
Forex market? In learning what factors affect the Forex market
every week and what to be on the lookout for? In getting trade
recommendations? Email mona@ecommstock.com to
get your copy of a weekly Forex report.
4) Closing Prices for Friday, December
12, 2008
Amidex: Amidex35 (Class No Load Shares),
$9.56; Index, 1236.57, Daily Change, .70%; “A” Shares NAV, $7.36.
Global Asset Management: Capital
Appreciation, $174.23; Composite Absolute Return, $769.88; Diversity,
$652.22; GAMCO, $552.40; Interest Trend, $164.64; Trading IV-US$
Class, $145.97; US$ Special Bond Fund, $296.58.
Invesco: Asian Equity Core, $2.69; Bond, $26.20;
Emerging Markets Bond, $14.31; European Bond, EUR 4.4090;
Gilt, GBP 12.74; Global High Income, $8.29; Japanese
Equity Core, $1.00; UK Equity, GBP 4.07.
JPMorgan Fleming: JF Eastern Smaller
Co., $55.11; JF Japan, JPY 10,667; JF Japan Equity, $9.54;
JF Japan OTC, JPY 720; JF Japan Smaller Companies, JPY
26,001; JF Japan Technology, JPY 28,679; JF Korea, $22.18;
Pacific Securities, $138.76; Pacific Smaller Companies
$13.74; Global Bond & Currency, $21.73;
JF America, $30.88; JF Europe, $25.69; JF Germany, EUR
14.26; JF Global Equity, $26.03.
PCP: North America, $10.00; Europe,
$13.33; Emerging Markets, $12.75; Balanced, $6.97; Aggressive,
$5.85.
Platinum (updated once a month – October 2008
Prices): All Weather, $129.92; Equity Plus, $81.86;
Prot. Equity Plus, TBA; Prot. Income Plus, TBA; Cap.
Prot. Income Plus A, TBA.
Scottish Provident: Adventurous 1,
GBP 2.157; Balanced 1, GBP 1.846; USD Adventurous 1, $1.421;
USD Balanced 1, $1.647; USD Cautious 1, $1.705; For
Preference: Baring GUF Eastern Europe, $53.82;
Fidelity Funds International, $21.820; Invesco Asian
Equity Core, $2.790.
Mona Liss
CommStock Trading Ltd
PO Box 7777
Jerusalem 91077
Tel: +972-2-6244963
Fax: +972-2-625 9515
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