A roundup of what The Globe and Mail's market strategist Scott Barlow is reading this morning on the World Wide Web.
The West Texas Intermediate crude oil benchmark price was lower by four per cent Monday morning but, given the intense intraday volatility lately, that's no guarantee it will even be in the red at the end of the day.
Report on Business has spent hundreds of hours detailing the specifics on the crude price decline but for those looking for an overview of the whole picture, Sober Look is the place to go. A recent post presents a series of charts depicting every aspect of the industry including rig counts, rig efficiency, inventory levels, the futures curve and the ongoing steady growth in U.S. oil production.
This is a must-read for Canadian investors, in my opinion.
"Diverging developments in oil markets vs. energy shares" – Sober Look
The outlook for domestic banks is the subject of huge debate in the analyst community. As the ROB's David Berman details, the sector faces considerable headwinds. The post contains an ominous quote from highly respected TD bank analyst Mario Mendonca.
"Most years, having faith in the banks' capacity to pull the levers necessary to generate good earnings growth is precisely the right approach…This year [2015] does not feel like one of those years."
Scotia bank analyst Sumit Malhotra has a different view, predicting dividend hikes for Royal Bank, TD, and his own employer.
"Canada's Big Six facing headwinds ahead of first-quarter reports" – Report on Business
Bloomberg's Joe "The Stalwart" Wiesenthal posted an excerpt from a Bank of America research report suggesting Tesla Motors Inc. might be announcing grand strategies to distract investors.
"In what appeared to us to be Tesla's latest effort to shift investor focus away from disappointing financial results, the company announced an upcoming unveiling of its stationary storage product."
"Latest teaser is stationary storage; be careful what you wish for" – Wiesenthal, Twitter
The Wall Street Journal re-created a chart from the Council of Economic Advisors' report to President Obama showing a remarkable decline in U.S. gasoline usage,
"Americans are producing much more energy, even as they consume less of it. One big surprise of the past decade has been the drop in energy use. Total petroleum consumption is down 21 per cent from its 2005 peak."
There's a bunch of useful charts for those who click through.
"The U.S. economy according to the White House in 10 charts" – Wall Street Journal
The Financial Times presented the latest in a series of explainers on the commodity space, this time detailing China's huge role in the birth of the commodity supercycle and the negative effects of the economic "new normal."
"Raw materials tied to construction and infrastructure, so called 'early cycle' commodities such as steel, iron ore and coal, are the most likely to be affected. Many analysts believe copper demand will be hit this year and next as property construction slows.
In its analysis of a scenario where Chinese demand growth remains flat, Macquarie calculates that the copper market would have a 2 million tonne surplus by 2019 rather than an expected deficit. For miners, that would erase the need for new capacity. Put another way: the boom days would definitely be over."
"Commodities explained: China's new normal" – Financial Times
Tweet of the Day: @JacobWolinsky FWIW: Goldman says market is most expensive in 40 yrs ex tech bubble pic.twitter.com/wfykAnrtgl
Diversion: British Columbia's hikers and mountain bikers are at war, complete with tripwire-induced casualties.
"Bikers versus hikers: B.C.'s war of the woods" – Macleans
Follow Scott Barlow on Twitter @SBarlow_ROB
Scott Barlow