Daily research and analysis summary of The Globe and Mail market strategist Scott Barlow
Like Scotiabank Monday, Credit Suisse analyst Manav Gupta believes now is the time to add energy stocks.
Mr. Gupta also provided a list of the best options that includes two Canadian stocks,
“We continue to believe that in a world after the Russia-Ukraine conflict, we lack crude oil, refined products and natural gas. We estimate that the world oil market was insufficiently supplied at ~ 1.5 Mb / d in 2Q 22 and will remain so. insufficient at ~ 0.8 Mb / d in 2H 22 and this will continue to support higher prices in the short term.Although the IEA still believes that markets will be somewhat balanced in 2022/2023, in our opinion, the IEA is overestimating the growth of supply in certain regions (including OPEC) and still underestimating total global demand … The world has no refining capacity and we hope that US refiners will probably do so. of the biggest beneficiaries of this, as European colleagues are struggling to replace Russian barrels … Our favorite names … also highlight the cases of reversal of our favorite names.Integrated oil: XOM, CLC, SU [Suncor Energy Inc.] and CVE [Cenovus Energy Inc.]. Up – COP, OVV and CHK. Midstream: LNG, PAA and TRGP. Refiners: VLO, MPC, DINO, PSX and VTNR.
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Wells Fargo strategist Chris Haverland details what I believe is the biggest risk in the short-term stock market: earnings rebates,
“After growing 9% in the first quarter of 2022, earnings from the S&P 500 index are expected to grow 5.7% in the second quarter of 2022 … It would be the slowest quarter of growth since the fourth quarter of 2020 … the energy, industry and materials sectors are expected to lead the way with a remarkable 205% growth in energy revenues.Excluding the energy sector, the global gains of the S&P 500 index will fall by 2% … The future direction will be key, as many companies continue to face rising input prices, a tight labor market and the continuing constraints of the global supply chain ” .
“WF on Q2 earnings” – (excerpt from the research) Twitter
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The long-term outlook for copper stocks is bright due to electrification, but it would be difficult to say as miners and commodity prices continue to fall. The RBC research team discussed the trend,
“US base metals have almost completely taken the price of copper and are now down 6% to date (copper -11.7% itd), but are still outperforming the broad market (S&P 500 -18.7 % ytd, TSX -). 9.4% per annum). US base metal stocks are trading at an 18% discount on the NAV, above the minimum levels around a 40% discount, but close of the historical average.22% discount (see page 6) While volatility could continue, we believe this pullback creates an opportunity to add high-quality names that will benefit from the positive fundamentals of copper in the coming years.
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Deviation: “9 invasive plants that you should cut into pieces” – Gizmodo
Eight of the day:
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