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Jennifer Lynn
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Jennifer is a proficient investor, executive and manager working with analytics data to drive smart business decisions. Technology, eCommerce, Management, Healthcare, Consulting, Strategy. Passionate for Finance, IT, Emerging & Global. Email: consultbydigital @ gmail.com Twitter:... More
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  • Banco Do Brasil Lending Concerns
    Banco do Brasil SA (BBAS3:SA) stock surged from previous years which were at low levels. The upswing resulted from economic unemployment and rising salaries. Credit grew around 16% in 2012 and it is expected to slow slightly this year, but it will remain at around 14%. Banco do Brasil is presently at a yield of 3.875%. The largest bank had, the world's largest initial public offering so far in 2009, was trading flat recently on the Sao Paulo Stock Exchange and down 1% on the New York Stock Exchange. At $8.04 billion, the deal eclipses the $7.34 billion raised by China State Construction Engineering Corp. in an IPO earlier this year, according to data from Dealogic. According to Reuters, "During the quarter, the default ratio at Itaú Unibanco Holding SA fell to its lowest since early 2009, when a merger formed Brazil's largest private sector lender, executives said this week. The default ratio measures the value of loans in arrears for 90 days or more as a percentage of a lender's outstanding loan book." On Friday, Banco do Brasil SA (BBAS3:SAO) closed at 22.81, 13.88% above the 52 week low of 20.03 set on Jul 05, 2013.

    José Maurício Pereira Coelho, Financial Director for Banco do Brasil stated "Assets sold €700 million in five-year bonds, more than the €500 million it had originally planned to sell, after demand topped €2 billion." The last time the bank sold euro-denominated bonds, in January 2011, it sold €750 million in five-year bonds at a yield of 4.5%.

    Emerging Markets

    The second round of monetary easing in the United States was in the later part of 2010. At this time emerging markets struggled with adapting quantitative easing and the U.S. which could impede on lowering the value of currencies. Investors, clammer with Banco do Brasil recent deal however with emerging markets are still vulnerable while the timing comes at a questionable time for the acceptance of a possible ease of the monetary policy in the U.S with Brasil markets.

    Banco do Brasil sold $2 billion in dollar-denominated perpetual bonds earlier this year. The deal was to improve its financial areas and continue to move forward with rapid credit growth. Banco do Brasil's credit grew to 16% in 2012 and is expected to slow slightly throughout this year. In 2013, growth will remain at around 14%.

    For investors, the economic conditions outlook looks optimistic for improvement. As a result Banco do Brasil can adapt to this market quickly as an existing reputable Bank to international countries. The bank will issue the latest bonds under its global medium-term note program, which has a limit of $5 billion, and it is planning to use the proceeds for general banking purposes, according to Standard & Poor's Ratings Services.

    Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

    Aug 10 7:04 PM | Link | Comment!
  • Monsanto Bioengineered-Seed Business

    Monsanto Company NYSE: MON Monsanto reported Wednesday that its income increased 22 percent in the agriculture products company's second quarter on strong sales of biotech seeds, particularly in Brazil and other emerging markets. The company boosted its full-year earnings guidance, citing its strong performance in the first half of the year. Monsanto Co.'s sales increased 15 percent to $5.47 billion, led by genetically modified corn seeds, the company's best-selling product. Monsanto Company fell $1.65 (-1.6%) to $98.78 on average volume. Throughout the day, 3,349,825 shares of Monsanto Company exchanged hands as compared to its average daily volume of 2,814,200 shares. The stock ranged in price between $98.75-$100.98 after having opened the day at $100.98 as compared to the previous trading day's close of $100.43.

    Monsanto has dominated the bioengineered-seed business for more than a decade. In recent years the company has focused on growing business in emerging markets like Argentina, Brazil and other Latin American countries. The company's corn, soybean, cotton and other seeds have genetically engineered traits that repel bugs, increase yield and make them resistant to weed-killer. The company says these benefit farmers enough that they come out ahead, even though the seeds cost more than conventional seeds. Monsanto's critics argue that the company has tried to use patent law to control the supply of seeds for soybeans, corn, cotton, canola and other agricultural staples. Monsanto has a policy that prohibits farmers from saving or reusing the seeds once a crop is grown.

    For Investors, new options have recently become available for the August 9th expiration. "Aerial spraying will be prohibited in areas defined by the municipalities, or in the two-kilometer (1.2 mile) boundaries between urban and rural areas," Gustavo Arrieta, minister of agricultural affairs in Buenos Aires province, told Reuters. The United Nation's Food and Agriculture Organization has urged developing countries to withdraw "highly hazardous" pesticides, saying they pose a serious risk to human health and the environment and are often not properly stored and distributed.

    Monsanto Company has a market cap of $54.1 billion and is part of the basic materials sector. Shares are up 6.1% year to date as of the close of trading on Tuesday. Currently there are 11 analysts that rate Monsanto Company a buy, 1 analyst rates it a sell, and 4 rate it a hold.

    Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

    Aug 10 7:02 PM | Link | Comment!
  • U.S. Treasury Yields Surge
    The U.S. Treasury Bonds rise to its highest level weekly in a decade with high yield currencies. The current U.S. Bond surge is due to a stronger economy. With markets adjusting and economic volatility, investors choose bonds as a safer option which offers more security. The Federal Reserve raised concerns and comments with investors speculations on easing QE3. U.S. stocks ended higher with ten-year U.S. treasuries yields rising above 2.50 percent, its highest intraday level since August 2011.

    The dollar continues to rise due to the positive economic forecast. The dollar rose 0.5 percent with a weekly gain of 2 percent, the highest since early July, 2012. The euro fell 0.7 percent to $1.3126 and the dollar gained 0.4 percent against the yen to 97.70 yen. The 10-year Treasury Bonds were down to yield 2.54 percent, while 30-year bonds dropped to yield 3.59 percent.

    The Federal Reserve is working to reduce the jobless rate of 7.6 percent after four years of economic growth. According to Bloomberg, "The economy will grow 1.9 percent in 2013 and 2.7 percent in 2014, the economy has not grown more than 3 percent over the course of 12 months since the four quarters ending in June 2006." The U.S. stock indexes had ended their worst week since April. The S&P 500 remained below its 50-day moving average last Thursday.

    Stocks and Treasuries fell Tuesday as Federal Reserve Chairman Ben Bernanke stated "The central bank may start dialing down its unprecedented bond-buying program this year and end it entirely in mid-2014 if the economy finally achieves the sustainable growth the Fed has sought since the recession ended in 2009." The Standard & Poor's 500 Index declined 1.4 percent to 1,628.93. The yield on the 10-year Treasury note jumped to 2.36 percent, the highest since March 2012, from 2.19 percent last Tuesday. Investors are still uncertain of The Fed's policy and plans.

    "If the incoming data are broadly consistent with this forecast, the committee currently anticipates that it would be appropriate to moderate the pace of purchases later this year." Bernanke said. "If the incoming data are broadly consistent with this forecast, the committee currently anticipates that it would be appropriate to moderate the pace of purchases later this year," Bernanke said in a press conference in Washington.

    The 30-year US Treasury Bond auction sold at 3.335% vs 3.325%. The Federal Reserve is currently buying $85 billion a month in bonds causing even more risk while sending U.S. stocks up about 15 percent year to date. MSCI's stock index missed at 0.3 percent and the FTSE Eurofirst 300 index ended down 1 percent. The Dow Jones industrial average added 41.08 points, or 0.28 percent, to 14,799.40. The Standard & Poor's 500 Index rose 4.24 points, or 0.27 percent, to 1,592.43. The Nasdaq Composite Index was off 7.39 points, or 0.22 percent, to 3,357.25.

    Investors should recognize the importance of maturity in high yield treasury bonds. There are yields for two, five and ten-year terms. The highs, lows and long-term averages are based on "constant maturity" methods employed by the U.S. Treasury. The bonds can be combined with coupon payments and maturities that match investors income criteria. High yield treasury bonds are investments with guaranteed returns. The yield to maturity is significant to determining actual yield received by the investor. The income that is earned from these type of bonds are a risk-free yield, exempt from state and local taxes. Long-term bonds are a safer option compared to stocks. An effective strategy is to leverage both stocks and treasury bonds in an investment portfolio to minimize risk and reward.

    The U.S. economy is meeting expectations as economic conditions are getting stronger. Investors that are dependent on income to allocate toward their expenses should be investing in the high yield treasury bonds. High yield treasury bonds are important for diversification in investor portfolios, reducing volatility and increasing predictability of returns. Investing in high yield treasury bonds should be a long-term investment strategy.

    Jun 22 6:09 AM | Link | Comment!
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