“The second quarter will not soon be forgotten by energy traders given that WTI crude oil futures plunged into negative territory for the first time in history, and decidedly so, in the month of April…” said Tyler Richey, co-editor at Sevens Report Research. That was “due to logistics issues in the physical supply chain, most notably a critical lack of available storage for freshly lifted crude barrels in the U.S.” On April 20, WTI oil futures fell 306% to settle at negative $37.63. Click here to read the full article.
What’s in Today’s Report:
- Short and Long Term Implications of the Fed’s “Hawkish” Decision
- The sector winners (and the biggest loser) after the Fed decision
- Oil/Energy market update
Futures are bouncing marginally as markets digest the Fed’s “hawkish cut” rate decision.
Economic data overnight was not as bad as feared, although it wasn’t good, either. EU (46.5 vs. (E) 46.4), British (48.0 vs. (E) 47.7) and Chinese (49.9 vs. (E) 49.5) July manufacturing PMIs all beat estimates, although they also remain below 50, signaling contraction.
Today we have an important economic report, ISM Manufacturing Index (E: 51.9) and we also get weekly Jobless Claims (E: 213K), and those numbers (especially the former) could move markets. But, beyond the data, and following the Fed’s “hawkish” decision, the keys to focus on will be the U.S. Dollar and the Treasury yield curve. If the dollar continues to grind higher and the yield curve flattens, that will be another headwind on stocks. Yesterday’s lows in the S&P 500 at 2959 are an important support level to watch if this market rolls over mid-day.
As of June 20, oil prices have settled a bit lower after an uptick following a larger-than-expected drawdown of U.S. crude stockpiles in early June. That drawdown “helped ease some of the supply side concerns in the energy market…but U.S. supply data is a secondary influence on the market…” according to Tyler Richey, co-editor at Sevens Report Research. Click here to read the full article.
Tyler Richey Quoted in Barron’s on April 18, 2019. The $33 billion deal “refocused the energy markets on the U.S. shale industry…and Russia took notice as the nation’s finance minister…” Click here to read the full article.
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