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1. Boom to burst: A funny thing happened on the $ 100 oil route: Crude oil crashed into a near-bear market.
US oil prices plunged to $ 62.63 a barrel on Friday, down 18.6% from their peak of a month earlier.
The fall of Crude has been caused by a series of factors, some of which may fade.
First, fears of global growth that drove the stock markets down have spilled over commodities. If the economy comes up against difficulties, it goes without saying that the appetite for oil will also drop.
Secondly, Washington has distributed non-prison cards to some countries. The Trump administration said Friday that temporary waivers have been granted to some Iranian oil buyers, allowing them to continue buying Iranian oil even after sanctions come back on Monday. This represents a softer approach that some fear.
"The decision to grant derogations is quite logical, because a too large initial loss would have resulted in a significant price increase," writes Damien Courvalin, head of energy research at Goldman Sachs on Thursday. going against the efforts of the US administration keep a lid on the prices of gasoline. "
And third, Texas and Saudi Arabia have taken over to quell fears of an oil shortage. US oil production, dominated by the Permian Basin in western Texas, exceeded 11 million barrels a day in August for the first time in its history.
"The growth in US production has been amazing," said Matt Badiali, senior research analyst at Banyan Hill Research, specializing in oil and commodities. "We are in unknown territory."
All this silenced the $ 100 a barrel of oil speech.
The fall of oil took place just in time for the mid-term elections in the United States. The average price of gasoline nationwide has decreased by 3% in the last month, according to AAA. Pump prices are lower than oil prices, suggesting a cheaper gasoline.
But some analysts warn that oil prices will probably resume their flight. Goldman Sachs and RBC Capital Markets are asking for Brent crude to end the year at $ 80 a barrel, 10% higher than its current level.
Courvalin warned that Iran's oil deliveries, which were close to 3 million barrels a day in May, would continue to decline as buyers wean themselves off. It expects exports to drop to 1.15 million barrels a day by the end of the year, then to a million by early 2019.
This could be problematic, as there is strong doubt that the United States and Saudi Arabia can compensate for the lost Iranian casks. The recent increase in production in Saudi Arabia gives the kingdom less room for maneuver to cope with future problems.
"Saudi Arabia produces flat. They are at maximum, "said Badiali.
The American shale boom is experiencing growth difficulties. The Permian Basin pumps so much oil that the region lacks pipelines, which creates bottlenecks that limit production. The problem may not be resolved until mid-2019.
In other words, the firepower may decrease, even as Iranian exports continue to decline.
2. Day of the election: The mid-term US elections are Tuesday. If the Democrats take control of the House, what will happen to the actions?
One fear is that the Democrats' victory may give rise to proposals to cancel President Donald Trump's tax cuts. Or, at a minimum, it would put an end to efforts to extend tax cuts to people who must expire in 2025.
CNN's Harry Enten predicts in The Forecast that Democrats will get a 17-seat majority in the House, but that Republicans will retain their advantage in the Senate. There will probably be no reduction in Trump's tax bill, but a new tax cut is just as unlikely. A split of mid-term decisions would likely keep US tax, commercial and regulatory policies on the same track.
3. Goodbye October: October has been a scary month for investors around the world, so investors are looking forward to November.
Fears of slowing growth, trade wars and higher interest rates have all pushed down global markets. So, what does he reserve this month? Brian Belski, chief investment strategist at BMO Capital Markets, recently told CNN Business that he thought the month of October was only a "correction within". a very big long-term bull market in the long term ".
The US economy continues to grow steadily and US companies are releasing a lot of money, even at a slower pace.
The rate hike has weighed heavily on the markets over the past two months. Investors will closely monitor the Fed, which meets on Wednesday, looking for signs of higher or higher interest rates.
4. Digital earnings: Etsy, Yelp, Zillow, TripAdvisor, GoDaddy and Match Group all report earnings this week.
IAC will report on its quarterly finances on Wednesday. The owner of Tinder is currently involved in a lawsuit against the co-founders of the dating app regarding his assessment. Earlier this month, IAC asked a judge to dismiss it, saying the co-founders had one month too late to bring such an action.
The company has had a tough time this year, partly because of Tinder's popularity. The stock is up 63% this year.
5. Media Mania: A full catalog of media revenues is to be released this week, including reports from Altice, Paramount, Discovery, Sinclair Broadcast Group, Tribune Publishing, News Corp., AMC Entertainment, Gannett, McClatchy, Scripps and Walt Disney.
21st Century Fox will also release its results on Wednesday, and investors will be eager to hear about the latest news on its deal with Disney and what the "New Fox" will look like under Lachlan Murdoch. Fox's $ 70 billion sale of a portion of its entertainment division to Disney will be completed in the coming weeks. Fox, Fox News and Fox Sports, the "New Fox", are trying to protect themselves from wire cutters and focus on live news and sports. The stock is up 30% for the year.
6. Coming this week:
On Monday – Benefits of Avis Budget Group (CAR), SeaWorld Entertainment (SEAS), Paramount (PGRE), Michael Kors (KORS) and Mylan (MYL)
Tuesday – Eli Lilly and Co. (LLY), 21st Century Fox (FOXA), CVS Health (CVS), Wendy's (WEN), Etsy (ETSY), GoDaddy (GDDY), Zillow Group (ZG), Match Group (MTCH), Sureffective (OSTK); Mid-term elections in the United States
Wednesday – Monster Beverage (MNST), Sinclair Broadcast Group (SBGI), Hostess Brands (TWNK), Tribune Publishing (TPCO), News Corp. (NWSA), Groupon (GRPN), Humana (HUM), Qualcomm (QCOM) and TripAdvisor TRIP), revenues from Roku Inc. (ROKU), IAC (IAC), Wynn Resorts (WYNN); FOMC meeting
Thursday – AMC Entertainment (AMC), Activision Blizzard (ATVI), Crocs (CROX), Gannett (GCI), Walt Disney (DIS), Party City (PRTY), Discovery (DISCA), Dropbox (DBX), Hertz Global Holdings (HTZ ). ), Yelp (YELP), FOMC meeting
Friday – Prof. E.W. Scripps Co. (SSP), McClatchy (MNI); the feeling of the consumer
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