Western sanctions against Russia represent another wild card, because they have thrown the supply-and-demand equation out of kilter. The OPEC Plus cartel, which includes allies such as Russia, also is motivated by fears that the global economic slowdown will undercut demand. The rapid economic recovery from the pandemic left them flat-footed and supply shortages ensued. When energy demand imploded in 2020 due to the coronavirus outbreak, the super-majors slashed capital expenditures. They decried the lack of investment during the worst of the pandemic in energy production and said the cartel’s ability to boost production remains limited. OPEC ministers also warned Wednesday that global supplies are critically low and insufficient to meet anticipated demand in 2023. Unless derailed by an economic downturn that’s more severe than expected, the energy sector’s winning streak should continue. That increase is paltry (tantamount to a rounding error), which suggests oil prices are on track to stay high into the foreseeable future. In return for his cajolery (some would say debasement), Biden was snubbed.Īt its meeting in Vienna Wednesday, OPEC Plus agreed to a 100,000 barrel per day production hike for September. In particular, Biden’s widely publicized fist bump with Saudi leader Mohammed bin Salman Al Saud was not a good look for the president. The Kingdom has received international opprobrium for its gruesome murder of an ex-pat Saudi journalist who was critical of the regime. Constrained supply will keep crude prices elevated.īiden two weeks ago visited Saudi Arabia, the world’s largest oil exporter and de facto OPEC Plus leader, in an effort to get the cartel to throw open the spigots.īiden was criticized by human rights activists for his deference to the Saudis. His efforts to convince Saudi Arabia to significantly boost oil production came to naught this week, which is embarrassing for the White House but bullish for the energy sector. House, but lousy luck with the House of Saud. President Biden has had good luck with the U.S. Beaten-down semiconductor stocks are regaining favor, amid this rare show of bipartisanship in Washington. President Biden is set to sign the bill on August 9. Read This Story: Signs of a New Bull Market in Tech The new legislation provides more than $52 billion for U.S.-based companies producing computer chips, as well as billions more in tax credits to spur investment in chip manufacturing. The tech sector has jumped the most, lifted by passage in the House and Senate last week of the CHIPS and Science Act.
The following tweet encapsulates Wall Street’s ebullience: In addition, the Prices Index decreased for the third consecutive month in July, down 7.8 percentage points to 72.3%. The July number surpassed consensus estimates of 54%. The ISM non-manufacturing purchasing managers index for July, released Wednesday, showed unexpected strength, coming in at 56.7%, above the 55.3% posted in June and the highest in three months. In pre-market futures contracts Thursday, stocks were little changed. equity indices soared as follows Wednesday, as positive economic data cheered investors: the Dow Jones Industrial Average +1.29% the S&P 500 +1.56% the NASDAQ +2.59% and the Russell 2000 +1.41%. Here’s a look at the factors behind the recent stock market rebound, and the risks that could derail it. When the next inflation numbers come out later this month, the summer rally could go from sizzle to fizzle. The dog days of August could still bite investors. of negative economic growth.īut don’t get too comfortable in your beach chair. We’ve enjoyed an impressive stock market rise this summer, despite high inflation, Federal Reserve tightening, and two consecutive quarters in the U.S.
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