US Stock Indices Are Poised To Start The New Year With Fresh Record Highs
While US stock indices are poised to start the new year with fresh record highs, energy prices are not acting nearly as optimistic, already wiping out an attempted rally overnight and starting to add to the heavy losses we saw for futures on New Year’s Eve. Since spot markets weren’t assessed Friday, we won’t see the impact of Friday’s prices until tonight, so even if you see small gains in futures today, cash prices are still moving lower for the day.
OPEC & Friends are meeting again this week, and besides officially naming a new secretary General, not much else is expected to change with the cartel.
The weekly Commitments of Traders report is delayed by the holiday but we do get a sneak preview courtesy of the ICE contracts. Both Brent and Gasoil contracts saw money managers add a large amount of new length, and reduce an even larger amount of short positions heading towards year end, which means those funds did not have a great NYE celebration.
Baker Hughes reported no net change in the total number of rigs drilling for oil in the US last week. For the year, 213 rigs were added in the US, 118 of which were added in the Permian basin. While the increase of nearly 80% in total is noteworthy, we’ll still need to see another 190 rigs added before reaching pre-pandemic levels.