Scott Barlow
A roundup of what The Globe and Mail's market strategist Scott Barlow is reading today on the Web
We must be getting close to a washout in oil where negative sentiment has gone too far. Wednesday's weekly report on U.S. oil and gasoline inventories is likely to cause volatility either way as crude hit its 2017 low overnight,
"Futures lost as much as 2.2 percent in New York after falling 1.2 percent Monday. Libya is pumping the most crude in four years after a deal with Wintershall AG enabled at least two fields to resume production. The amount of oil stored in tankers reached a 2017 high of 111.9 million barrels earlier this month, according to Paris-based tracking company Kpler SAS."
"Oil Drops to Seven-Month Low as Libya Adds to Persistent Surplus" – Bloomberg
"Oil prices hit seven-month lows on global oversupply" – Reuters
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Successful portfolio managers frequently talk about the importance of keeping emotions away from their investment decisions and remaining cold and objective. What's more emotionless and disciplined than software? Businessweek reports that roboadvisers are crushing human investors,
"Rishi Ganti used to help manage the personal fortunes of hedge fund founders David Siegel and John Overdeck … Ganti, 45, says he's glimpsed the future of his industry. A wave of coders writing self-teaching algorithms has descended on the financial world, and it doesn't look good for most of the money managers who've long been envied for their multimillion-dollar bonuses… 'Algorithms are coming for your job — they only ask for electricity,' says Ganti, jabbing his finger on a lime-green laminated table. 'Algorithms are already reading, processing, and trading the news even before the photons have hit your retina.'"
"Robots Are Eating Money Managers' Lunch" – Businessweek
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The consensus view on domestic interest rates is changing rapidly. Economists had expected the first Bank of Canada rate hike in 2018, or late 2017 at the earliest, but now a move on July 12th is seen as a 50 per cent probability,
""We got a rate cut surprise in January 2015 with very little softening up of the ground," said Michael Gregory, an economist at Bank of Montreal. "Therefore the Bank of Canada is saying, 'We may or may not go in July, probably won't, but if we do be warned."'
"Poloz Weighs the Sudden Urgency of a July Rate Hike in Canada" – Bloomberg
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The reason global corporations hold so much cash is that they don't see anything promising to invest in,
"Short-termism is as much consequence as cause of weak growth" – Garcia, FT Alphaville
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Tweet of the Day: " @ErnestScheyder "Shale is like going on a date, the oil sands is like getting married" – Twitter
Diversion: "Scientists Sharply Rebut Influential Renewable Energy Plan" – M.I.T. Technology Review
Scott Barlow