Crude Oil

Junk Bonds Are Finally Starting To Care About Oil

"The recent price action in the oil market and the stronger response of the HY Energy sector has prompted many market participants to question the ability of the broader HY market to continue to resist lower oil prices. In our view, the bar remains high for oil prices to become the main directional driver of HY spreads but the risk has risen."

RBC Warns Of Looming "Cocktail For Fall Volatility"

"This combination of ‘interest rate vol’ events could drive another bout of ‘taper tantrum’ into the late Summer liquidity doldrums and fresh off of the ‘synthetic tranquility’ of US equity earnings season - a cocktail for Fall Vol on the resumption of ‘policy convergence’ and ‘tightening into slowing backdrop’ fears..."

World Stocks Hit Record High For 10th Consecutive Day In "No-Vol Nirvana"

Traders, so mostly algos, are riding a global risk "high" in stocks as Asia's and then Europe's early 0.4 percent gains ensured MSCI's 47-country All World index was up for a 10th straight session. This is the longest winning streak in global stocks since February 2015 and shows little sign of fatigue even as bond yields edged modestly higher again.

Frontrunning: July 19

  • Republicans consider bipartisan healthcare talks (Reuters)
  • Health Care Collapse Could Leave Trump Winless in His First Year (BBG)
  • Republicans to Push Ahead on Repeal of Affordable Care Act (WSJ)
  • Obscure Coal CEO Rains Money on Trump While Outflanking Rivals (BBG)
  • GOP Tries to Regroup on Obamacare Repeal as Trump Lashes Out (BBG)

Global Stocks Hit Record High, Set For Longest Winning Streak Since 2015

With the USD just off 10-month lows, there continues to be an easing of loosening of financial conditions for emerging markets which also supports equities. After decent gains in Asia on the back of positive signs from China this week, MSCI's world stocks index looked set for a ninth day of gains which would mark its longest winning streak since October 2015.

Dollar Tumbles, Euro Soars After Obamacare Repeal Dies; China Intervenes To Halt Rout

The Bloomberg Dollar Index tumbled to a fresh 10-month low after two more Republican defections on Monday night doomed the proposed GOP healthcare plan in the Senate. And while Treasuries rose on concerns about inflationary pressures and the viability of the Trump stimulus agenda, S&P futures rebounded gingerly from session lows, and were up 0.1%

US Shale Production Just Hit A New All Time High

In July, the total US shale basin is producing a record amount of crude oil, which the EIA pegged at 5.472mmb/d, up almost exactly as predicted, and is expected to rise by a further 113kb/d in August to a new all time high of 5.585mmb/d.

Gartman Covers Oil Short

"we are going to move to the sidelines in crude oil, covering our short position upon receipt of this commentary and standing aside. In retrospect, we should have covered last week amidst what was then panic liquidation, but we follow our rules regarding the changing nature of the contango and shall make the change today."

Our Financial Buffers Are Thinning

If we survey the financial landscape for fully intact buffers, we find none. Every buffer has been thinned by the past eight years of extreme monetary and fiscal policies and financial leverage, that is, debt piles ever higher on an unchanged foundation of collateral.

Loonie Bulls? Sold To You!

"Sure Poloz is more hawkish, but to a large extent, his policy decisions will be driven by the Canadian economy’s performance. Given the high reliance on real estate, the last thing Canadian dollar bulls should be hoping for is higher rates. Both higher rates and a higher Loonie will sow the seed for its descent."