Market Update March 9th, 2017 Rebecca Wang, Jake Yoon Executive Committee Members Market Update March 9th, 2017

Headlines Caterpillar’s headquarters raided by federal authorities Headquarters raided by law enforcement authorities over possible tax fraud Program designed alongside PwC attributed sales to lower-taxing Switzerland for higher profit Senate investigation concludes that from 2000-2012, $2.4bn worth of taxes were evaded IRS Revenue Agent’s Report called for $2bn in back-taxes and penalties due to tax avoidance Shares fell by more than 4% after 35% increase over the past 12 months Republican health plan is attacked by conservatives Trump’s support proves insufficient for right-wingers who denounce plan as “Obamacare lite” The proposed plan would allow people the choice to buy insurance rather than require them to Would replace insurance subsidies with capped tax credits ($2-4k) and repeal taxes on the wealthy Brazil’s economy contracts for eighth consecutive quarter Brazil’s economy shrank by 3.6% last year - the country’s worst and longest recession on record The latest 0.9% contraction in final 3 months of 2016 was slightly worse than estimates Brazil’s central bank has begun to slash interest rates; they are amongst the highest for any large economy in the world at around 7%

Company of the Week: Volkswagen (OTCMKTS: VLKAY) Volkswagen faces legal action by EU The European Commission announced that consumer agencies from 28-members plan to take a joint action With Dutch authorities taking the lead, they plan to allege that VW’s use of defeat devices to cheat on emissions tests was a breach of EU law on advertising claims Consumer protection agency powers vary by country, not clear how many will take action Alleged violations are latest manifestation of 2015 “dieselgate” VW admitted that up to 11mm cars worldwide had been fitted with software Plead guilty and paid $4.3bn in penalties. 6 indicted executives and employees Anti-pollution system specifics VW programmed diesel engines to activate certain emissions controls only during laboratory emissions testings to meet NOx output standards Engines emitted up to 40x more NOx in real-world driving, with 500,000 affected cars in the United States during model years 2009-2015

Market of the week: Oil Decreased investor interest after failure to break out of tightest range in a decade U.S. crude oil inventories increased by 2.93mm barrels last week according to API inventory report Report of a 35-rig increase to number of active oil and gas rigs in the U.S., the largest single-week increase in years Oil market fell within minutes of API data release, resulting in 0.51% decrease in futures’ price as of March 7th

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