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Energy

Global Markets

Strong Appreciation Of U.S. Dollar After Fed Rate Hike Hits Raw Commodity Sector

The feature in the marketplace Thursday is a surging U.S. dollar index that soared to a 13-year high overnight. The greenback is the beneficiary of a U.S. interest rate hike on Wednesday that was accompanied by a surprisingly hawkish tone on monetary policy from the Federal Reserve. There is now talk the Fed could raise interest rates up to three times in 2017.

Victims of the sharp appreciation of the U.S. dollar are raw commodity markets that are priced in U.S. dollars on the world markets, including gold

Global Markets

World Markets On Hold Ahead of FOMC Decision

World stock markets were mostly weaker in subdued trading Wednesday. U.S. stock indexes are pointed toward narrowly mixed openings when the U.S. day session begins.

The marketplace later today gets the results of what is arguably the most important economic event of the month: the U.S. Federal Reserve FOMC meeting, which began Tuesday morning and ends Wednesday afternoon with a statement. Fed Chair Janet Yellen will also hold a press conference after the statement is released at 2:00 p.m. EDT.

Most believe the Fed will raise interest rates for the first time in a year.

Global Markets

World Stock Markets Mostly Up Tuesday; FOMC Meeting Set To Begin

The marketplace is awaiting what is arguably the most important economic event of the month: the U.S. Federal Reserve FOMC meeting, which begins Tuesday morning and ends Wednesday afternoon with a statement. Most believe the Fed will raise interest rates for the first time in a year.

In fact, the Fed funds futures market shows a 100% chance the Fed will raise U.S. interest rates this week. With a Fed rate hike so fully expected, markets have mostly factored it into their price structures.

Thus, don't be surprised to see many markets show a "buy the rumor, sell the fact" scenario following the actual announcement of the Fed rate hike.

Crude Oil Prices Sharply Up As OPEC, Non-OPEC Producers Agree to Further Reduce Output

The feature in the marketplace to start the trading week is sharply higher crude oil prices. Nymex crude oil futures prices hit a 16-month high of $54.51 overnight and are up by over $2.00 a barrel in early U.S. trading.

OPEC and non-OPEC oil producers on Saturday came to an agreement to cut their collective oil production by just over a half-million barrels a day, which does not include the 1.2 million barrels a day that OPEC already agreed to cut in September. Reports said the combined cuts represent about 2% of the world oil supply.

World stock markets were mostly weaker Monday, on corrective, profit-taking pullbacks from recent solid price gains that put several world stock indexes at multi-year or even record highs.

Global Markets

World Stock Markets Higher As Trader/Investor Optimism Remains Generally Upbeat

World stock markets were mostly firmer overnight. European stock markets benefited in part from Thursday's European Central Bank meeting on monetary policy that was deemed dovish. Financial stocks in Europe have posted decent recoveries recently. U.S. stock indexes are pointed toward slightly higher openings when the New York day session begins. The Dow and S&P 500 stock indexes have hit record highs this week on ideas world economic growth is on the upswing and will continue on that path in 2017.

In overnight news, China's consumer price index in was up 2.3% in November, year-on-year, while the producer price index was up 3.3% in the same period.

Global Markets

World Stock Markets Firmer Tuesday, Led By Wall Street and Dow's Record High

Global stock markets were mostly firmer overnight, following the lead from New York's higher close Monday, where the Dow Jones Industrial Average hit another record high. European and Asian financial shares showed some recovery from recent losses, amid Italy's "no" vote on constitutional reforms.

Asian stock markets were also lifted on relief that the Italian no vote did little to rile the world marketplace. U.S. stock indexes are pointed toward narrowly mixed openings when the New York day session begins.

In overnight news, the Euro zone third-quarter gross domestic product was reported at up 0.3% from the second quarter and was up 1.7%, year-on-year.

Global Markets

Markets Quickly Move Past Sunday's Italian "No" Vote On Constitutional Reforms

Sunday's much-anticipated Italian referendum on constitutional reforms produced a "no" vote by an overwhelming margin. Italy's prime minister immediately resigned. Many markets initially were gyrated on the news, but quickly settled down. The government-backed no-vote was not unexpected by the market place. Still, this latest development is another sign of the insecurity of the European Union and the growing potential for continued fragmentation of the EU. The Italian vote was especially worrisome to the European banking and financial sector.

The Euro currency initially slumped to a 20-month low on the Italian no-vote, but quickly recovered those losses to trade higher on the day.

Global Markets

World Markets Now Focusing On Sunday's Italian Referendum, ECB Meeting Next Week

Global stock markets were mixed overnight, on this first trading day of the month. Asian shares benefitted from Wednesday's OPEC agreement to cut production levels, while stock markets in Europe were pressured on worries about the December 4 Italian referendum on constitutional reforms.

A "no" vote on the reforms could eventually put Italy in violation of European Union rules. U.S. stock indexes are pointed toward weaker openings when the New York day session begins.

World bond markets remain in focus as yields continue on the rise. U.S. 10-year yields have risen to 2.4% late this week.

Global Markets

Sharp Gains In Crude Oil Prices Lift Global Stock Markets Wednesday

World equity markets were mostly firmer Wednesday amid sharply higher crude oil prices. U.S. stock indexes are pointed toward firmer openings when the New York day session begins.

Traders and investors worldwide are anxiously awaiting the results of the OPEC oil cartel meeting that began Wednesday in Vienna, Austria. Crude oil prices are sharply higher on reports Iran's oil minister said he believes a deal to curtail the cartel's collective crude oil production will be reached, even though Iran does not want to immediately scale back its output.

There is also marketplace uncertainty regarding the December 4 Italian referendum on constitutional reforms.

Energy

How to Invest in Energy with the Middle East on the Brink

I just got back from Abu Dhabi, in the United Arab Emirates, where I attended a series of meetings with colleagues from across the energy "universe."

The scope and pace of development in this Persian Gulf city-state are staggering. Just five years ago, the astonishing, massive Etihad Tower complex we stayed in didn't even exist. This place is constantly expanding and reinventing itself.

So Abu Dhabi was an apt setting to discuss the sweeping changes that will shape the immediate future of energy investing – changes that threaten the fragile political order of the Middle East and will likely force a redrawing of U.S. security interests.

Everything is in flux right now, so I'm recommending energy investors look at one particular kind of oil producer that should prove largely insulated from what's coming next.

But first, let me show you what's at stake here...