Posts from ‘July, 2009’

Do equity markets lead commodity markets? Or perhaps more precisely do commodity equities lead the underlying commodities themselves? Our research suggests that there is enough evidence that commodity equities do lead the behaviour of commodities, although the lead times can vary from anything from a month to up to 6 months. Towards the end of [...]

Whilst many will argue that the fundamentals for natural gas are bad we would urge readers to note that fundamentals always appear bad at the bottom of a market and conversely at the top of the market they appear infinitely positive. Of course in investing the trick is to see through what is and consider [...]

Outward appearances suggest that inflation is not a problem (yet) rather it is deflation that is all the rage. However, beneath the scenes inflationary pressures and growth expectations are building rather rapidly. We do not think that analyzing “official inflation” statistics does one any good if you are trying to keep ahead of the market. [...]

Shipping stocks are up there with the most unwanted stocks in world stock markets as far as fundamental valuations go. The median P/Book ratio of shipping companies listed in the US is a mere 0.785. This is more or less the cheapest P/B valuations that shipping stocks have traded at since the 1970s (sorry our [...]

Has the tumble in commodity prices over the last 6 weeks signaled the end of the “reflation”, “inflation”, “green shoots” trade? Evidence suggests not! While the CRB CCI index has fallen by a respectable 9% over the last 6 weeks it still remains above “support” and has yet to violate the essence of an up-trend, [...]

We have been watching with interest the speed with which market pundits/participants/punters have crossed the floor (from the bullish to bearish camp). Since the 1st of June, just 6 weeks ago, the Dow World has fallen by some 7%, the CRB Index 10%, the USD Index +1.5% and US 10 year +1%.
These are not exactly [...]

Is world industrial production starting to pick up? The market suggests something is heating up. We watch closely the performance of an ETF called KOL which is essentially representation of world coal stocks. From the chart below a clear trend of outperformance of KOL vs. the Dow Jones World is depicted. If [...]