OUR CURRENT THINKING ON MARKETS Perspective on Current Market Trends Art Hogan, Chief Market Strategist Wunderlich Securities
TOP TEN REASONS MARKETS MUST GO DOWN 1. Valuations 2. We have gone 16 trading days without a 1% move in the S&P 500 3. The yield on the 10 year is forecasting global economic slowdown or not 4. The Fed is starting to drain the punch…
RUSSELL 2000 Source: FactSet
S&P 500 Source: FactSet
NASDAQ COMPOSITE Source: FactSet
WHAT ENDS BULL MARKETS Recessions Fed tightening too fast Inverted yield curve Irrational exuberance
WHERE IS THE GOOD NEWS Economic data improving Banks are lending Central Banks are accommodative Europe is stabilizing
FACTORS HAVING AN IMPACT ON OIL PRICES Boosting Prices: Dampening Prices: 1 Increase in global demand due to cheaper oil 1 OPECs commitment to regaining market share 2 Supply disruptions, long term or short term, 2 Iran production…
U.S. Crude Oil Production 10,000 9,500 9,000 Thousands Barrels per Day 8,500 8,000 7,500 7,000 Jan-2014 Jul-2014 Jan-2015 Jul-2015 Jan-2016 Jul-2016
LESS OIL SLOSHING AROUND THE GLOBE According to the EIA OPEC and Non-OPEC Oil Supply U.S. crude oil production averaged 9.4 million bpd in 2015 1Q16 averaged 9.2 million bpd Production estimated at 8.1 million bpd in 3Q17…
GLOBAL OIL SUPPLY: TIGHTENING WITH GEOPOLITICAL RISKS Several factors are affecting prices: Iran back to pre-sanction levels at 3.64 mmbpd this May, exporting 2.0 mmbpd of crude Peak production disruption from the Canadian oil…
GLOBAL SUPPLY AND DEMAND: BALANCING IEA projecting Demand growth of: Demand/Supply Balance until 4Q17 US: Crude Runs 1.4 mmbpd in 2016 (1.3%) 1.3 mmbpd in 2017 (1.3%) Source: Envantage, July 6 2016 Source: EIA STEO June 2016,…
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