Tag Archives: Saxo Bank

WCU: Oil ready to pop as coffee perks up and gold takes a breather

WCU: Oil ready to pop as coffee perks up and gold takes a breather

By Ole S. Hansen    januar 30, 2023

The Bloomberg Commodity Index (BCOM) traded higher for a third week as it continued to recover from an early January selloff that was driven by the IMF’s global recession warning. Gains were broad, although the energy sector was being weighed down by continued weakness in natural gas as prices slumped to their lowest since June 2021. The themes underpinning prices remain the same, with financial markets seeing a softer dollar and lower yields in anticipation of the US Federal Reserve moving closer to pausing an aggressive rate hike cycle. Since starting last March, this has driven the US Fed Funds rate up to 4.5% with the market now pricing in less than two 25 basis point rate hikes before the pause. 

The demand side, apart from the risk of a slowing global economy, is being supported by the prospect of China’s reopening – driving expectations for a pick-up in demand for commodities from the world’s biggest consumer of raw materials. However, with the prolonged shutdown of markets in China during the Lunar New Year holiday, some recent strong gainers, such as copper, iron ore and crude oil paused, thereby allowing other commodities to appear at the top of this week’s leaderboard. In the coming weeks, the risk to supplies of Russian fuel products may add an extra layer of support for gasoline and not least diesel, thereby providing enough support to keep crude oil shielded from recession-related demand fears.

Continue reading WCU: Oil ready to pop as coffee perks up and gold takes a breather

Ole Hansen – Head of Commodity at Saxo Bank’s views on the strength of the commodity market in November.

Commodities: Strong November led by metals

By Ole S. Hansen    December 5, 2022

The Bloomberg Commodity Index Total Return index traded up 2.7% in November, thereby driving the index to a 19% gain on the year. The strong gains among industrial and precious metals offset the minor decline in energy and grains prices. Following several challenging months, the metal sectors found support from a weaker dollar and sharply lower bond yields, both driven by a lower-than-expected US CPI print last month. The emerging weakness in US economic data has led to speculation that the US Federal Reserve may soon slow its pace of rate hikes.

Continue reading Ole Hansen – Head of Commodity at Saxo Bank’s views on the strength of the commodity market in November.

WCU: Putin’s threats more than offset by Powell’s inflation-fighting actions+ ( Saxo Bank analysis )

WCU: Putin’s threats more than offset by Powell’s inflation-fighting actions+

By Ole S. Hansen    september 26, 2022

Commodities traded generally lower in a week where the big lines were drawn by developments in Washington and Moscow. At their latest FOMC meeting, the US Federal Reserve managed to surprise on the hawkish side of expectations after an expected 75-basis point rate hike was followed up by the removal of expectations for a cut in 2023. Changes that were made despite a significant lowering of the GDP forecast for this year and next as well as a sharp rise in the unemployment rate forecast, a signal the Fed is willing to continue hiking rates even if the economy deteriorates in order to get ahead of inflation.

Continue reading WCU: Putin’s threats more than offset by Powell’s inflation-fighting actions+ ( Saxo Bank analysis )

Copper: supply fundamentals trump weak sentiment- Saxo Strats

Copper: supply fundamentals trump weak sentiment

By Ole S. Hansen    September 10, 2022

Copper is showing signs of stabilizing despite an overriding negative sentiment towards China-centric commodities such as copper, cotton and now also crude oil after both WTI and Brent slumped below support on Wednesday. The country’s battle with Covid and the governments steadfast support for its zero tolerance has led to renewed lockdowns and restrictions of movements in regions with around 300 million citizens and that account for one-quarter of Chinas GDP.

Continue reading Copper: supply fundamentals trump weak sentiment- Saxo Strats

Consumer stocks to be hit by historically high energy costs- Saxo Bank

Consumer stocks to be hit by historically high energy costs

By Peter Garnry

Head of Equity Strategy

Consumer discretionary stocks were part of the winners since the Great Financial Crisis, but with rising interest rates and soaring energy costs, the consumer is getting taxed on credit and available income for discretionary consumption. These dynamics will intensify and worsen over the winter period in Europe and several sell-side firms are already cutting price targets on many consumers’ discretionary stocks. We identify the 10 largest global and European discretionary stocks so investors can understand their exposure to the global energy crisis.

Continue reading Consumer stocks to be hit by historically high energy costs- Saxo Bank