Oil

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Putting the attack on Abqaiq, Saudi Arabia in context for Monday

As has now been widely reported, more than half of Saudi Arabia's oil production supply was knocked out Saturday in an attack on Abqaiq oil facilities claimed by Yemen’s Iran-aligned Houthi rebel group. Saudi Arabia has indicated it will provide an update on their production situation by sometime Monday. 

While oil prices are likely to climb in the immediate aftermath, the more important question is what happens after the initial excitement passes. As Nick Colas from DataTrek Research explains in this August 22nd Real Vision interview, the oil price, not just the yield curve, is an important recession indicator. The interview provides insightful context for the week ahead given the attack.

Nick Colas on the importance of oil as an indicator

Sound bites: Dippers Become Swingers

In my latest interview with Jim Goddard at Howestreet.com, I explain the key investing theme in our latest US Market INK report: the sea change facing investors after the election of Donald Trump. 

Sound Bites: Oil enters a bear market after a mixed verdict on Japanese stimulus (Update)

Updates number of mining stocks to 30 from 31 in third paragraph, adds that they are in the Basic Materials sector.

Japanese bonds and oil are shaky, should we worry? On Friday, Business Insider noted that oil had slipped into a bear market after falling 20% from its recent peak of just over US$51 per barrel. The move happened on the same day the Bank of Japan decided not to increase its bond purchases which dampened hopes for helicopter easing. While the two developments may not be directly related, falling oil and Japanese policy maneuvers both have implications for investors.

Sound bites: Will stocks slip on sliding oil prices?

With key US benchmarks making new all-time highs and the INK Canadian Insider Index making another 52-week high on Wednesday, the key question is whether or not the momentum can be sustained. A key positive development for market bulls over the past week has been the participation and leadership of the Financials, with the Thomson Reuters Financials Index jumping 4.16% compared to a 3.04% gain for the S&P 500 as of Tuesday. A good amount of the gains took place early in the week as long bond yields rose on the back of renewed hopes for aggressive global monetary easing. There was plenty of chatter that the Bank of Japan (BoJ) would be considering either a form of targeted lending to effectively assist the central government in financing a large infrastructure plan or "helicopter easing" which we would dub as HE. Under HE, the central bank would send cash payments or loans directly to households, bypassing the credit markets.

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