Oil is driving the bus.
Post date: 2024-09-12 16:18:44 GMT
Are You Prepared?
This note is part of AbleMarkets’ new weekly Macro series. Subscribe to AbleMarkets today to have full access to our research content.
According to the latest analysis by AbleMarkets, oil futures prices had the most significant impact on the U.S. markets last week. What does this mean for the other markets? This note will provide a brief overview of the implications.
Assets that are heavily dependent on oil, such as oil refineries and related companies like ExxonMobil, are more likely to experience negative price returns. The stock returns of these companies are strongly positively correlated with oil returns.
Conversely, there are assets whose returns are negatively correlated with oil returns, making them effective hedges. According to AbleMarkets analysis, pharmaceutical companies like Benitec Biopharma Inc (BNTC), the Equity Volatility Index VIX (^VIX), and U.S. Treasury Bond futures tend to rise when oil prices drop, indicating a negative correlation in their stock returns.
Overall, this analysis highlights the importance of closely monitoring oil futures prices and their implications for various sectors in the market. Subscribe to AbleMarkets for regular macro trend analysis.
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