On June 23, 2017, the US Commodity Futures Trading Commission released its weekly “Commitments of Traders” report. It reported that hedge funds decreased their net long positions in US crude oil futures and options by 60,556 contracts or 31% to 134,742 contracts on June 13–20, 2017. It’s the lowest level since August 2016.
It suggests that hedge funds are bearish on crude oil (IXC) (ERY) (ERX) prices even after OPEC’s successful meeting. Moves in crude oil prices impact oil and gas producers’ earnings like Hess (HES), Warren Resources (WRES), and QEP Resources (QEP).
Crude oil price forecasts
A market survey from 31 banks suggests that WTI crude oil prices will average $53 per barrel and $58 per barrel in 2017 and 2018, respectively.
A market survey from 33 banks suggests that Brent crude oil prices will average $55 per barrel and $60 per barrel in 2017 and 2018, respectively. BNP Paribas and DNB Markets predict that Brent crude oil prices will hit $60 per barrel in 2017 despite oversupply concerns. WTI and Brent crude oil prices averaged $43.3 per barrel and $43.7 per barrel in 2016, respectively.
On June 26, 2017, Pioneer Natural Resources (PXD) stated that US crude oil prices could trade below $60 per barrel until 2021 due to high global crude oil inventories. Higher crude oil production from the US, Libya, and Nigeria could also pressure crude oil prices in 2017 and 2018.
Read Dennis Gartman: Is the Pain Done for Crude Oil Futures? and Crude Oil Prices Could Collapse despite OPEC’s Production Cut for more on crude oil prices.
Read Will US Natural Gas and Crude Oil Follow the Same Trend? for more on natural gas prices.
In 2016, Chevron (CVX) stock witnessed an uptrend due to rising oil prices. During the year, Chevron’s 50-day moving average crossed over its 200-day moving average.
Broadcom (AVGO) stock fell ~8.5% after markets closed yesterday following the semiconductor giant's fiscal 2019 second-quarter earnings release. It missed analysts' revenue estimate and cut its fiscal 2019 revenue guidance by $2 billion to $22.5 billion due to sluggishness in its semiconductor solutions business.
The SPDR Gold Shares ETF (GLD), which tracks physical gold prices, has underperformed the broader markets year-to-date, rising just 4.4% compared to the S&P 500’s (SPY) gain of 15.9% as of June 14. The sentiment for gold, however, has been turning around.
Safe havens such as Treasuries and gold were back in favor on June 14 as stocks fell due to rising tensions in the Middle East, concerns over growth, and the looming threat of the US-China trade war. The tech-heavy Nasdaq Composite Index fell 0.67% in the first hour of trading.
Lululemon (LULU) stock rose 2.1% on June 13 in reaction to better-than-expected first-quarter results and an upgraded outlook for fiscal 2019 overall. The company's first-quarter adjusted EPS grew 34.5% to $0.74 on revenue growth of 20.4% to $782.32 million. Analysts had expected EPS of $0.70 and revenue of $755.31 million. Here's why the outlook got an upgrade.
As of 4:40 AM Eastern Time today, US crude oil active futures were at $51.83, ~4% below their closing level in the previous week. If US crude oil prices stay at those levels today, they'll mark their third week of decline in five weeks.
Amazon is discontinuing its Amazon Restaurants service, which has been delivering food for restaurants in parts of the United States. Amazon Restaurants launched in the United States in 2015 and entered the British market the following year. However, it met strong opposition in the British market.