@Mcgill Engineering Investment Group

2013-01-25 Volume 1, Issue 2

Inside this issue

EIG Newsletter ............... 1 Economy News .............. 2 Technology .................... 3 Technology ..................... 4

Newsletter
Montreal Banking Tour
The McGill EIG is proud to present their first student-run finance banking tour in Montreal, which will bring together leading industry professionals and top McGill students. It will offer students the opportunity to visit trading floors and expand their network. The tour will take place on February 8th and should include a full day of scheduled events. So far, we will be visiting BMOs trading floor and investment banking bullpens. The EIG team is working hard with other potential partners. Stay tuned!

Mining ............................ 5 Healthcare ..................... 6 Disclaimer ...................... 7 Upcoming Events

Montreal Banking Tour

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

Market Analysis
Economy News
Interesting Article: The other side of QE [The Economist]

Economy News
Feds Bond Buying Pushes Assets to Record $3 Trillion [Bloomberg]

Interesting Article: Bank of Canada rate decision: What the analysts say [Financial Post]

FEDs total assets climbed by $48b in the past week to $3.01t as of Jan. 23 Due to the open-ended purchases of Treasuries and mortgage-backed securities to combat 7.8% unemployment

Bernanke Seen Pressing On With Stimulus amid Debate on QE [Bloomberg]

The FED will probably forge ahead with their unprecedented bond buying when they meet next week, even as they pick up a debate that began in December on when to end the purchases The FOMC said it will keep rates near 0 as long as the jobless rate is above 6.5% and inflation is forecast to be 2.5 percent or less

Rise in Leading Index Signals U.S. Expansion into 2013 [Bloomberg]

The index of U.S. leading indicators rose in December by the most in three months Signaling stronger housing and job markets will help the worlds largest economy make more progress in the first half of 2013

Interest Rates Will Spike This Year: Soros [CNBC]

Expects interest rates to jump this year as soon as there are signs the economy is on the mend U.S. needs to re-establish growth to help shrink its debt pile FEDs policy of buying U.S. debt is the right one since it doesn't add to the net amount of debt outstanding.

Rate hikes delayed as Bank of Canada cuts forecast [The Globe and Mail]

Bank of Canada overestimated growth, interest rates remain low Governor Mark Carney, said higher interest rates now are less imminent because Canadas economy is expanding markedly slower than the central bank had forecast a few months ago Any hike would be further away than previously planned, because of excess capacity, soft inflation and stabilizing household debt.

Technology
AAPL shares plunge to 11-month low after missing forecasts

Technology
AAPL shares plunge to 11-month low after missing forecasts
Apple Inc. missed Wall Street's revenue forecast for the third straight quarter after iPhone sales came in below expectations, fanning fears that its dominance of consumer electronics is slipping. Shares of the world's largest tech company fell 12 per cent to $450 on Thursday, wiping out some $50 billion of its market value nearly equivalent to that of Hewlett-Packard and Dell combined. On Wednesday, Apple said it shipped a record 47.8 million iPhones in the December quarter, up 29 per cent from a year earlier.

RIM surges ahead as BB10 launch looms

Google shares gain after robust Q4 results

RIM surges ahead as BB10 launch looms

Research in Motion (RIM) has gained 20 percent over the past week, reaching a high of about $18.30, as the Blackberry makers announced the launch of the Blackberry Enterprise Service 10 (BES 10) on Wednesday. With the launch of the highly anticipated Blackberry 10 (BB10) phones due on January 30th, the bulls seem to have taken over the RIM market for the time being.

Google shares gain after robust Q4 results

Google shares rose by approximately 5 percent on Wednesday after CEO Larry Page announced that the company had a quarterly total revenue of $14.42 billion, which was a 36 percent increase over the previous time period in 2011. That turned into an earnings-per-share count of $8.62 per share, beating Wall Street estimates by 14 cents.

Nokias roller coaster ride

Nokias shares gained 5 percent on Wednesday morning after it reported a profit for its fourth quarter. However, the companys shares plunged by about 8 percent on Thursday as it announced that it would get rid of its dividend, leading investors to dump the stock in Thursday pre-market trades.

Technology
Nokias roller coaster ride

Mining
Quick links:

Mining
This week, the Vancouver Resource Investment Conference took place on January 20th and 21st. The event featured
48 speakers and 508 exhibitors. The Cambridge House conference is held in various Canadian cities including Vancouver, Calgary, Toronto and Montreal. It is a must for those who like to invest in the Canadian junior space. A brief recap of this weeks conference can be found here.

Cambridge House Conference

www.tmxmoney.com

On January 21st, the government of Ontario announced that it would invest $3.1 million in skills training for projects
in the Ring of Fire. The Ring of fire covers an area of 5000km2 where companies have made significant gold, nickel, chromite, iron and platinum discoveries.

TSX Venture

On January 22nd, the Bank of Japan announced that it would keep its interest rates at 0.1% until inflation returns to
American Manganese
2%. This had a positive impact on commodities and the S&P/TSX Venture Composite Index closed up 0.36%. Nonetheless, the index was down 4.2 points or -0.34% in the week.

Iamgold Corp. News

One interesting fact is that as of November 27th, 2436 companies were the TSX Venture exchange, 52% of which
closed at 10cents or less. We expect to see major consolidation in the mining space as big producers start ramping up M&A.

Recently, the US FAA decided to ground all Boeing Dreamliner 787s due to faulty lithium-ion batteries.

Conventional mining processes are known to introduce metallic impurities and these impurities are what cause some batteries to smoke up and sometimes explode. Thus far, the EIG knows of only one mining company that has a patentpending process to remove these dangerous impurities fom the raw materials. This Canadian based company is called American Manganese Inc. and has a pilot-plant in Arizona. Click here to learn more about American Manganese.

In other news, Iamgold Corp. (T.IMG) shares were down 18% on Thursday, after the company announced
maintaining its production forecast and increased projected mining costs for the year ahead.

that its

Healthcare
Mixed Signals from St Jude
St Jude Medical (NYSE: STJ) has been the center of mixed news of late. This week STJ reported its fourth quarter earnings fell 4% due to increased restructuring costs and a 2.5% drop in revenue due to weak sales for St Judes heart-rhythm devices. Still, St Judes stock has continued to recover after plummeting from intense scrutiny and the possibility of recalls over defects in its Durata defibrillator leads. Investors are optimistic about St Judes Portico device as it recently gained regulatory approval to compete in Europes transcatheter valve market. St Jude is trying to catch up with its competitors, Medtronic (NYSE: MDT) and Edwards Life Science (NYSE: EW) who have built up a led in the TAVI market. More information on St Judes outlook can be found here .

Healthcare
Mixed Signals from St Jude

Johnson and Johnson CEO Unsatisfied

ResMed Revving Up

Johnson and Johnson CEO Unsatisfied

Johnson & Johnson (NYSE: JNJ) had a good month of January as this week it reported a much larger fourth-quarter profit than last years. Johnson & Johnsons CEO, Alex Gorsky, gave investors a cautiously optimistic outlook but warned his staff that a Johnson & Johnsons solid performance was still inadequate. Indeed, though Johnson & Johnson managed to avoid many of the charges that depressed its profit a year ago, it has still recently come in to controversy over the unusually high number defects and failures in its hip implants. More information can be found here and here .

ResMed Revving Up
ResMed (NYSE: RMD) shares jumped 6.25% on Friday, close to its 52-week high, after it crushed its year-ago EPS by 26%. Revenues reached a record high of $376.5 on strong and growing sales in the sleep-disordered breathing market. Read more here .

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