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In the latest edition of our weekly financial markets update:
Click here to read our weekly financial markets update report.
|MSCI World||+2.2%||CHF Corp||+0.7%|
|S&P 500||+2.8%||US Govt||+1.0%|
|Stoxx 600||+1.3%||US Corp||+1.4%|
The Times said, based on the Internal Revenue Service transcripts of his tax returns from 1985 to 1994, that Trump’s core businesses racked up losses of more than a billion dollars over ten years. During 1990 and 1991, Trump’s losses “were more than double those of the nearest taxpayers in the I.R.S. information for those years.” In summer 1990, three casinos in Atlantic City, the Plaza Hotel, and the Trump Shuttle airline couldn’t meet their interest payments. Some of the dozens of banks that had lent money to Trump were threatening to foreclose on their loans, which could have caused a cascading chain of bankruptcies, including Trump personally. Banks eventually agreed to keep him afloat by extending more than 60 million dollars in credit, but he was forced to cede his empire management control, at least temporarily.
Since many years, there have been no official release of Trump’s tax returns. But Mazars USA, his accounting firm, has been issued subpoenas by both the Congress (April) and the Manhattan district office (September) to release his last 8 years tax returns. The Supreme Court is now involved in these disputes. Trump is attempting to stretch the boundaries of presidential immunity to avoid his impeachment. The State of New York engaged a criminal investiga-tion into Trump and his family business role in hush-money payments made to keep multiple women from sharing allegations of their affairs with Trump before the 2016 election.
Trump had no Midas touch as an entrepreneur
Still, so far, he always managed to resurface like a Phenix
The US administration has opened-up several conflicts with both his allies and rival countries, on many different fronts. In geopolitics, the situation in Middle East and Korean peninsula have notably deteriorated lately. Q. Soleimani assassination was at first an erratic and despicable decision. Nevertheless, it has probably successfully set a red line to Iran and sent a warning signal to Kim Jong. The rising tensions in Hong Kong and Taiwan (following latest elections) will add to the complexity of US-China rivalry.
But the latest trade truce and the end of Yuan depreciation are good news, short-term. The US economy is proving resilient and the equity market surpasses its own records yet again. The US Republican party is totally devoted to Trump and will definitely block the impeachment process. As a logical consequence, Trump approval rating is flying highest since his election! No serious Democrat party contender has emerged so far.
Trump has, no doubt, a consummate art of counter-fire The growing impeachment noise is of little - if any – relevance
The GBP rose against all G10 currencies in Q4 2019. So far this year, it has failed to outperform and is back to its December lows. Its near-term outlook has somewhat weakened. Several Bank of England members have sounded gloomier despite a better clarity on Brexit. Market expectations for a rate cut by March 26th have jumped from 15% to 65% chance. Risks are titled to the downside. Despite a dovish tilt, it is still too early to expect rate cuts.
Amid a temporary lull in Brexit turbulence, the BoE story is once again drawing the attention of investors. The GBP slipped after BoE Governor Carney signaled the bank was debating the merits of near-term easing. Another BoE member indicated that rate cut is more plausible.
This easing shift is not a new revelation as two BoE members voted for rate cuts at the past meetings. In a world of unprecedented low rates, rate differentials have lost their explanatory powers for FX. That is why GBP volatility, on the back of recent BoE comments, is a breath of fresh air.
On the rate side, the clearest takeaways from Carney’s speech is the very limited appetite for negative interest rates. Even if he is leaving in March, it is a clear signal. This is reinforcing the view that the Effective Lower Bound will remain just over 0% to ensure that overnight market rate remains in positive territory. Another tool is the forward guidance to clearly signal the path of rates. This should help to peg forward interest rates as long as the BOE remains credible. In a context with political uncertainty and complex EU relationship, the path for rates for the next 2 years will be driven by the BOE. Long-end yields will stay low. A BoE move this month would be premature as the no-deal Brexit risks have faded. The BoE should wait to see the extent to which households and firms’ confidence increased because of the vote before adding more stimulus.
A stream of disappointing UK data has confirmed the MPC's concerns. A downside surprise or signs that the data is not improving would likely cement market expectations of a cut. Even if the UK data improve and the BoE refrains from cutting rates in January, the specter of a cut in the months to come (given the clear easing bias) as well as the uncertainty about the form of a UK-EU trade deal suggest that any rebound in sterling should be shallow. The fact that the speculative positioning is no longer stretched (turning from meaningful shorts to modest longs) also suggests limited upside potential for GBP.
It is remarkable how the CHF has strengthened since the December SNB meeting despite fading political risks. One interpretation is that markets are expecting a prolonged period of low inflation without adding to expectations that SNB could cut rate further. The SNB kept its monetary policy unchanged in December at -0.75% and will maintain it in March. It reiterated that the CHF is highly valued and that it is ready to intervene in the market to weaken it, if needed. On a PPP basis, it is only overvalued by 7% which is not that extreme.
However, a stronger currency is not welcome as it slashes all its efforts to push inflation higher. With inflation forecasted at 0.1% in 2020, far from the target and able to fall below 0% in an adverse scenario, the SNB can only maintain rates in negative territory and fight against a strong CHF on the FX market.
With a 3-month delay, the US Treasury FX Report has been released. As expected, China's manipulator label was lifted, and the attention shift to other countries. Switzerland is an interesting one. Meeting both the bilateral trade and current account criteria, currency interventions by the SNB – more likely, after the recent CHF rally – may warrant the manipulator label. However, some clarifications are needed.
First, the FX purchases currently amount to $3 bn, or 0.5% of GDP. So, meeting the 2% threshold would imply a considerable $12 bn of net purchases in a year. Second, the Treasury requires that net purchases occur for at least 6 of the 12 months covered in the report. So, a one-off intervention may not imply further buying. Third, a possible manipulator label would not happen until October 2020, when the next report will be released.
If the Swiss economy is hit by a negative shock or if the CHF appreciates too much, the SNB could be forced to lower its key interest rate even lower, possibly to -1.0%. This is not our base scenario, but the risk of a fall in interest rates remains very present.
The SNB could consider restructuring its balance sheet, out of USD assets into EUR ones, to downplay the US tensions and support the EUR. For the time being, the SNB holds 34% of USD-denominated assets and 40% in EUR. According to the Confederation, in 2018, Switzerland exported 46% to Europe and 16% to the US, while it imported only 64% from Europe and only 8% from the US. Even it was a smart decision to favor US assets – given their excess return – the currency reserve allocation significantly deviates from the trading partners split.
Alphabet joined Apple and Microsoft in the club of firms capitalizing more than $ 1,000 bn, but at the price of a sharp increase in their PE ratios, multiplied by 2 for Apple and for Microsoft in 2019. Amazon had passed above $ 1,000 billion in summer 2018, to recede to $ 924 billion today. Apple’s weight in the S&P 500 is 4.7%, Microsoft’s 4.3%, Alphabet 3.4% and Amazon 3.2%. Including Facebook, the top 5 values of the S&P 500 account for 18% (12% in 2016)!
Is such a re-evaluation of multiples justified, at 24x 2020 for Apple and 28x for Alphabet and 29x Microsoft ? These levels are not shocking for companies with annual growth rates of 2017-2021e profits at 30% for Alphabet, 27% Microsoft and 17% Apple.
They also generate a lot of cash: $ 210 billion for Apple (despite $ 175 billion of share repurchases over the last 2 years !), $ 135 billion for Microsoft and $ 123 billion for Alphabet. Moreover, they are, like the others in technology, entering into a new cycle linked to 5G which should boost 1) sales of smartphones, semiconductors, connected objects and data centers, 2) the cloud and 3) augmented reality.
In the short term, technical analysis shows an overbought situation of the FANG+ index and Apple, while Alphabet and Microsoft are flirting with an overbought pattern.
The price of palladium is exploding : +30% in 2020 to $ 2,500 an ounce, after an increase of 45% in 2019. Rhodium also posted an impressive performance in 2020 with +47% at $9500 per ounce, after +134% in 2019.
It’s a fundamental story. Demand from the automotive sector has risen sharply due to more stricter CO2 emissions legislation, while supply is in deficit. The majority of the production of palladium (80%) and rhodium (90%) is used for catalytic converters in the automotive industry.
Car manufacturers could look for a cheaper alternative by replacing palladium with platinum. Platinum is not 1-to-1 interchangeable, but it has some similar characteris-tics to palladium. Platinum is mainly used in catalytic converters for diesel engines, whereas palladium for petrol engines. But it could take 2 years to acquire the certifications using platinum, in addition to the costs. Manufacturers should therefore not arbitrate on platinum, especially since catalytic converters represent only a small part of the total cost of a vehicle. However, there is no substitute for rhodium, which is an extremely rare metal.
The 2 main producers of palladium are Russia (40% of world production) and South Africa (35%), followed by Canada (10%). For rhodium, South Africa is the main producer (82%), followed by Russia (10%), Zimbabwe (5%) and Canada (3%). Annual rhodium production is 20 tons with very limited spare capacity, while demand is estimated to be around 28 tons.
Technically, rhodium and palladium are highly over-bought, but their supply is limited. And the two metals are aimed at industrials and not investors. Specialists agree on a higher price for the 2 precious metals, with a solid fundamental history. And after 16 months of declining car sales in the United States, Europe and China, prices for palladium and rhodium could further rise with a recovery in auto sales due to a widening supply / demand imbalance.
The fundamental story of palladium and rhodium is solid. But we would be tempted to play the platinum catch-up, which could benefit from very high palladium prices and a recovery in car sales.
This document is solely for your information and under no circumstances is it to be used or considered as an offer, or a solicitation of an offer, to buy or sell any investment or other specific product. All information and opinions contained herein has been compiled from sources believed to be reliable and in good faith, but no representation or warranty, express or implied, is made as to their accuracy or completeness. The analysis contained herein is based on numerous assumptions and different assumptions could result in materially different results. Past performance of an investment is no guarantee for its future performance. This document is provided solely for the information of professional investors who are expected to make their own investment decisions without undue reliance on its contents. This document may not be reproduced, distributed or published without prior authority of PLEION SA.
Courtesy of central banks’ repression of volatility, greed gradually overcame fear, namely for yield hungry investors. ¨Cryptomaniacs¨ first took the tall, as policymakers (in Asia) and financial sector (in Anglo-Saxon countries) joined forces to strangle this ¨corrosive and dangerous¨ means of speculation. This was considered sort of adventures as being a confidential / speculative corner of the investment universe.
Then came short-volatility products, growingly popular also among retail clients. In January only, inflows into the two most ¨liquid¨ products (XIV and SVXY) reached about $700mios! The unwinding of these trades is much more unsettling for markets. Indeed, they come in many forms, like combinations of puts and calls in derivative markets, or OTC tailor-made structured products. They are not only linked to equities, but also to other asset classes (which have stayed pretty calm so far…). Global size is enormous.
Complacent / greedy retail and qualified investors have both been caught on the back foot
The ruthless lesson is that crowded trades appear danger-ously stable, until they… spectacularly break
¨One must guard when everything is (too) rosy, right!?¨. As developed in our latest Monthly (re: Minsky moment), greed and complacency have been nurtured by the very long absence of surprises. Calm made investors lazy and complacent. In this former regime, advanced economies’ central banks repressed volatility, ad nauseam. It took a cocktail of toxic developments i.e. a weaker USD, much higher yields and oil to finally shake investors’ confidence. The cherry on the cake was probably the latest spike in US wages, triggering a brutal wake-up call for deflation apostles.
The sudden rise of volatility fuelled, in two days, enormous liquidation of positions in the largest ETFs: about $7bn in US equities, $1bn in emerging debt, $1,2bn in US high yield… A cohort of sophisticated managers using extensively algorithms (risk parity, variable annuity), are now under alert. The upsurge in cross-asset correlation is a symptom of very large flow-driven liq-uidations. This has little to do with deep fundamentals. This rather features a serious change in psychology, sort of a come-back of realism.
This time is not different: changes in inflation regimes are always significant for financial markets
Sentiment indicators have collapsed lately, breaking out from exuberant level a couple of days ago. Market’s versatility is not new, though pretty spectacular this time! This does not make durable trends. We don’t expect advanced economies’ central banks to come to the rescue, this time. Quite the opposite. Indeed, they will irrevocably be engaging, one after the other, in quantitative tightening. There are three main reasons for that: extravagant size of their balance sheets, concerns over financial stability (speculation / bubble formations), and a need to build dry powder (restore positive real rates ahead of next downturn).
This will spell more unstable financial markets’ developments. Even if they will never admit it, central bankers welcome the resurgence of volatility, which may help contain leverage and speculation… For now, volatility was contained to equity markets. A contagion to other asset classes is far from unlikely. A pursuit of the soft ongoing correction of bond markets – say US 10y government bond climbing markedly above 3% - is likely.
Higher yields finally forced investors to reconsider positions taken in an era of easy money
The gradual reconstruction of risk premiums across asset classes is likely. Valuation metrics will probably be less generous in the future
Wise investors should better watch out before calling a regime change, as featured by (so) many false starts over past years. Indeed, US realized inflation figures have proved benign so far. More, the ¨weakish¨ long term drivers of price trends, i.e. demography and productivity, have not changed at all. Automation, robotizing, if not globalization remain also severe structural headwinds for a slippage in global prices. And finally, the latest most credible supranational forecasts for 2018/9 (by IMF and OECD) remain pretty quiet. For sure, the US will experience some cyclical pick-up in inflation, as a weak USD will favor more expensive imports. But this is a marginal factor, as the US economy is not so open actually. Oil price rise will also percolate into higher input prices for corporate and possibly impact output prices. But this is a transitory phenomenon. And the mechanics is not linear, as companies could decide to take some share of that burden out of their margins. Who knows… Oil is not a permanent / important inflationary factor, because its spike would ultimately provoke an economic slowdown.
So, what’s up actually? Are markets, again, overplaying the inflation risks?
Let’s consider for a while a handful of factors that may, significantly, change the global picture:
The latest US job report added fuel to the fire for the current hawkish market sentiment. The financial conditions have fallen from recent highs but remains favorable and very supportive for growth. Recent gyrations in financial markets should have a limited impact on the Fed outlook, unless they become more persistent. If financial markets stabilize and financial conditions do not deteriorate further the Fed should be able to look through recent volatility and remain on track to raise rates in March and beyond. This sentiment was echoed by NY Fed President Dudley, who indicated that the recent bump in stocks does not affect his outlook, though it could be if it were sustained.
ECB President Draghi failed on its own to stem the upward trajectory of the EUR. He did not step up his rhetoric enough. Investors sentiment and market consensus remain so convinced that a stronger EUR will not derail the euro-zone recovery that they have still increased, to record high, their long EUR. Long term rates relationship are no longer working for months. However, even based on a short-term dynamic, the current EUR valuation looks extreme and represents a major risk for the euro area recovery.
Since last November, the JPY/USD correlation with US interest yields has sharply broken down. While the yield differential has significantly widened to 2.7% from 2.3%, the cross fell to 109 from 114. Initially, the JPY strengthened on US tax cuts and rate hikes expectations but failed to break the 115 level. Then, it entered in a corrective phase. The USD/JPY is in a consolidation period. It is trading on its long-term technical support around 106 and need to exceed 112, to turn bullish. Wait and see.
While the relationship between rate differentials and FX has broken down sharply between the USD and some of the main currencies, monetary policy remains very relevant for the GBP. The cross is perfectly fitting the 12 month sterling overnight forward contracts. To compensate investors for the UK's negative net foreign liabilities, a weaker GBP and/or higher yields are needed to finance the current account. Monetary policy remains very relevant for the GBP outlook.
Based on the sight deposit data, the SNB seems to be back in the market, trying to prevent the CHF from strengthening again. The strengthening pressure against the USD has been significative this year – and the CHF has not weakened in tradeweighted terms in the beginning of 2018, in contrast to SNB wishes. Also, against the EUR, the CHF has gained momentum in the recent weeks. The SNB would step up the fight if this continues.
Based on its key drivers, the AUD seems to be the less aligned with yield spreads, commodity prices and risk sentiment. With the US 10 year yields spread on the verge of becoming negative, higher US (real) yields could do considerable damage to foreign investors' appetite for Australian bonds, with flows historically drying up in the absence of some yield pick-up. From a pure domestic stand point, the bubbling property market represents another source of risk like the al-ready very stretched long positioning in commodities.
USD, EUR, CHF, GBP, JPY, AUD, CAD, EMFX
Jerome Powell just took office as Fed chairman. In the short term, he will stick to the current monetary policy plan by raising gradually the Fed funds this year and being committed to remain behind the curve to let inflation and expectations migrate to Fed’s projections. Latest job report reinforces the ongoing need for a gradual Fed tightening. Easier financial conditions and the prospect of a greater role for fiscal and regulatory easing warrant higher yields. The term premium has drifted modestly higher albeit to levels observed just before the sharp decline in late 2017. However, it is still too low. The December early February yields spike was expected. The pace of the current episode is below average in terms of duration and magnitude.
By most measures, US yields are too low and the term premium still too negative. Given the rapid central banks purchasing programs slowdown, if not exit (Fed), and expected supply/demand imbalances, the term premium should be in positive territory. The Fed term premium can turn positive and yields can still climb further. Foreign inflows are not expected yet. Overseas buyers are facing mounting costs to protect their bond positions from swings in foreign exchange markets. And given the potential for trade conflicts and monetary-policy shifts, there are plenty of reasons to have that insurance. Hedge costs are more likely to rise on the back of the widening rate differentials, which should make it even harder to buy Treasuries. We maintain our US 10 years yield forecast at 3.00/3.25%. A Fed falling modestly behind the curve would mitigate downside risks for fixed income risky assets. On the Euro side, the room for more aggressive front-end pricing is likely to be limited. It should be difficult to price more than the slightly above 50% likelihood of a 25bps hike by March 2019.
the view that inflation conditions will normalize in the com-ing quarters, and this should imply further medium-term upside for breakevens. In the near-term, the market and macro backdrop could however turn less supportive as EUR strengthening effects have turned negative.
Concerns over inflation and rising rates lead to a pick-up in market volatility and sharp correction in equities, putting credit spreads under widening pressures. As spreads are still trading around their cyclical tights, the appetite for low quality balance sheets has also been visible even for secularly challenged sectors. The bifurcation between HY and IG fund flows picked up steam, with large HY outflows, and significant IG inflows on the opposite.
Since the beginning of 2017, subordinated financial bonds have had a very impressive run. At current levels, the spread compression in subordinated financials has likely run its course and a consolidation is expected.
High Yield, Hybrid/Sub
Emerging hard currency
US Treasury, Inflation
Emerging local currency
The stock markets are coming out of a long period of liquidity support from central banks. This liquidity had not been reinvested in the real economy because of the need for commercial banks to strengthen their own capital and of a lack of opportunities in the real economy. Today, the real economy offers more opportunities thanks to the acceleration of economic growth, which is global and synchronized. Companies report bottlenecks due to increased demand. Wage increases appear through union negotiations or the effect of US tax reform. The fundamentals of a recovery in inflation are therefore being put in place. The Fed is adopting a less accommodative monetary policy other central banks will follow suit.
So, some consequences for the stock markets. Unfavorable: 1) a more attractive real economy and less generous central banks will reduce liquidity for risky assets, 2) expectations of a return of inflation will have an impact on stock market valuations, downwards.
Favorable: 1) The growth of corporate profits will be up sharply with an annual growth of at least 10% for the next 2 years. In 2018, the favorable and unfavorable factors may offset each other; in any case in the first half. The table below incorporates a readjustment of the S&P 500's P/E ratio of 22x to 19x due to the expected inflation increase and earnings per share of $155 in 2018. We calculate an S&P 500 that could reach 2,945 in 2018, with a more volatile path. The potential of the stock markets therefore seems to be lower in 2018 than in 2017. Moreover, they will be torn between a tightening of the Fed's monetary policy, which has often been historically favorable to equities, and the arrival of a new boss at the Fed which has often been celebrated by a stock market correction.
EPS S&P 500 in 2018
|BNPA S&P 500 in 2018|
|PER S&P 500|
Inflation : economists' consensus / EPS : consensus Bloomberg
In the United States, while the relationship between bond yields and earning yield is still favorable to equities, the ratio between bond yields and dividend yields has risen above the historical average of the past 14 years, to the detriment of equities.
A weak dollar has favored US and emerging equities, as well as oil and industrial metals. We think the US currency should appreciate, not much, but enough for investors to favor European equities. The United States offers good earnings growth potential through the tax reform and the next infrastructure spending program, and in general by the Donald Trump's very pro-business approach. But Europe also has strengths thanks to the dynamism of President Macron and his desire to make Europe evolve more efficiently. Stock market valuations are also in favor of European equities. We are overweight discretionary, energy, financials and healthcare sectors which are benefiting from economic growth, from companies’ ability to adjust prices up and a surge in investment in capital goods.
Discretionary, Energy, financials, Health Care
Staples, Industrials, IT, Materials
Emerging currencies have had a good past quarter, being on average up by more than 5% vs. the USD. Higher US rates have clearly been counterbalanced by the strong commodity prices, good domestic macro data and weaker USD. However, as the long positioning in commodities is already very stretched, there is a risk of experiencing a corrective phase.
The Indian stock market remains one of the most interesting among emerging countries. In 2017, the Sensex index rose by 28%. The bancarization of the economy pushes the middle class to buy financial assets, especially equities, while before the demonetization, gold and real estate were the main sources of savings because the Indians paid all in cash. In January, Indian equities corrected due to the introduction of a capital gains tax. But the bulls point out that the structural trend of Indian savings to financial assets is solid. After the demonetization and harmonization of the VAT, the government is tackling another major project: agriculture and rural policy. An important topic ahead of the general elections in India in 2019. The budget of the Minister of Finance gives a large place to farmers, the distressed people, the elderly, infrastructure and education. The rural world is important for the government to win the 2019 elections and farmers have suffered considerably from two years of drought. In agriculture, the government wants to move from a centralized organization to a decentralized system, and double the wages of farmers within 2022, year of the 75th anniversary of India's independence. The consequence will be a budget deficit of 3.5% of GDP. After estimating GDP growth between 7.2% and 7.5%, the finance minister expects GDP growth to exceed 8% in 2018.
China is doing well. Fears of an economic slowdown did not materialize in 2017, on the contrary: the increase in GDP was 6.9% compared to +6.5% in 2016. In January, imports jumped by 36.9% and exports by 11.1%; imports were certainly affected by the Long Lunar New Year holidays starting mid-February, pushing companies to increase their inventories. Nevertheless, domestic demand begins the year 2018 on a strong dynamic. Coal imports are at their highest since 2014. Nevertheless, the FTCR China Business Activity indicator is down for the 3rd month in a row, affected by the appreciation of the renminbi, the more restrictive monetary conditions and more restrictive regulation for local governments. The CSI 300 index fell 8% with the stock market correction. The strength of the renminbi is not favorable to Chinese equities, but low stock valuations are a good support for the Chinese indices: 13.4x 2018 for the CSI 300 and 7.8x for the Hang Seng China.
The evolution of the dollar is an important component for the evolution of emerging indices. They took advantage of it when the dollar falls. Today, the US currency is recover-ing and corrects an oversold situation. If the dollar's recovery is confirmed, emerging markets should underperform. Before buying the emerging stock markets, we will wait for the dollar to stabilize.
The decline in the dollar had benefited to industrial and precious metals, as well as oil. The US currency is correcting its bearish excess. Technically, the USD index has made a double bottom and is starting a rally. This trend of the USD should be a factor of underperformance of metals and oil. Speculative positions are high. Closing long positions could lead to a correction in the prices of metals and oil.
More volatility and the severe correction of cryptocurrencies confirm the gold quality as safe haven and good asset of diversification. The price of gold fell with the recovery of the dollar, but also after profit taking to deal with margin
calls on equities. The likely increase in volatility on the financial markets following the gradual withdrawal of monetary stimulus will increase turbulence and benefit to gold.
Demand is strong and supply remains under control after years of under investment. There are many infrastructure projects and we are waiting for Donald Trump's infrastructure spending program. Copper, zinc and nickel are the preferred metals of analysts. The development of the electric car will accelerate the need for lithium, cobalt and manganese to make batteries. The price of platinum has suffered from the drop in sales of diesel cars, being used in catalytic converters. In contrast, palladium benefited from higher sales of gasoline cars; the rise in the price of palladium is also explained by a supply deficit. But analysts believe it's time to take profits on palladium with the revolution of the electric car that is running.
The oil price is benefiting from the global and synchronized economic growth and production agreement between OPEC and some non-OPEC members such as Russia. But it can also induce some indiscipline of some producers like Nigeria and Venezuela. The other supply risk is the rise in unconventional production, particularly US shale oil. The US production is running at full speed: the latest data show that the United States produced 10.25 million barrels/day and thus exceeded the previous record of 10.04 million b/d dating from 1970. The possibility for US producers to exploit new areas released by Donald Trump could help increase global supply. Estimates of US production are at 10.6 million b/d in 2018 and 11.2 in 2019. Today, the additional supply is largely offset by strong demand.
This document is solely for your information and under no circumstances is it to be used or considered as an offer, or a solicitation of an offer, to buy or sell any investment or other specific product. All information and opinions contained herein has been compiled from sources believed to be reliable and in good faith, but no representation or warranty, express or implied, is made as to their accuracy or completeness. The analysis con-tained herein is based on numerous assumptions and different assumptions could result in materially different results. Past performance of an investment is no guarantee for its future performance. This document is provided solely for the information of professional investors who are ex-pected to make their own investment decisions without undue reliance on its contents. This document may not be reproduced, distributed or pub-lished without prior authority of Plurigestion SA.
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