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Commodity Market Increased Slightly In January Due To Continued Positive Fundamentals

NEW YORK, Feb. 13, 2014 /PRNewswire/ -- Commodities increased in January due to supply worries in livestock and to weather fundamentals supporting the energy sector.

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

Nelson Louie, Global Head of Commodities in Credit Suisse's Asset Management business, said, "The outlook for growth looked far more stable at the start of 2014, with fewer identifiable risks than seen in previous years.   However, with the Federal Reserve's move to begin tapering its monetary stimulus, combined with weaker data from both the US and China, it is clear that risks remain.   We continue to believe cyclical improvement in global growth will be paced by better performance in developed market economies as Europe exits recession and the US endures lessened fiscal drag.   This implies that the excess of growth in the emerging market universe over the developed market economies will be narrower than it has been for the last several years."

Christopher Burton, Senior Portfolio Manager for the Credit Suisse Total Commodity Return Strategy, added, "As monetary policy continues to normalize in the US, we expect correlations between commodities and traditional asset classes to continue to decrease and individual commodities to continue to be increasingly driven by fundamental factors.   Weather played a key role in driving returns for January, with the polar vortex leading to extreme cold and wet temperatures in parts of the US, supporting Natural Gas.   However, it also led to extreme dry and warm weather in other areas, including Brazil, supporting Sugar and Coffee later in the month.   Weather may continue to play a key role driving commodity returns in 2014, should extreme patterns continue. "

The Dow Jones-UBS Commodity Index Total Return performance was positive overall for the month, with 9 out of 22 Index constituents trading higher.   Livestock was the best performing sector, up 4.32%, with both Lean Hogs and Live Cattle ending the month higher.   The USDA's January livestock report revealed the number of cattle on feed at the start of the year was down 5.4% compared to January 2013.   Energy ended the month 3.40% higher, led by Natural Gas. Crude oil and petroleum products declined, however, led lower by Gasoline, as the record cold and wet weather for much of the US depressed driving demand.   Precious Metals increased 1.92%, led by Gold, as weaker equities and capital outflows from emerging economies boosted the metal's safe-haven appeal.   Agriculture declined slightly, down 0.46%, due to mixed returns from sector components.   Industrial Metals was the worst performing sector, down 4.91%. China's manufacturing activity worsened in January as output and new order growth weakened, according to the latest surveys.

About the Credit Suisse Total Commodity Return Strategy Credit Suisse's Total Commodity Return Strategy has been managed for over 19 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:

  • 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 January 31, 2014, the Team managed approximately USD 10.7 billion in assets globally.  

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 is able to offer clients its expertise in the areas of private banking, investment banking and asset management from a single source. Credit Suisse provides specialist advisory services, comprehensive solutions and innovative products to companies, institutional clients and high net worth private clients worldwide, and also to retail clients in Switzerland. Credit Suisse is headquartered in Zurich and operates in over 50 countries worldwide. The group employs approximately 46,000 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.

Asset Management  In its Asset Management business, Credit Suisse offers products across a broad spectrum of investment classes, including hedge funds, credit, index, real estate, commodities and private equity products, as well as multi-asset class solutions, which include equities and fixed income products. Credit Suisse's Asset Management business manages portfolios, mutual funds and other investment vehicles for a broad spectrum of clients ranging from governments, institutions and corporations to private individuals. With offices focused on asset management in 19 countries, Credit Suisse's Asset Management business is operated as a globally integrated network to deliver the bank's best investment ideas and capabilities to clients around the world.

All businesses of Credit Suisse are subject to distinct regulatory requirements; certain products and services may not be available in all jurisdictions or to all client types.



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