Trade war is officially over as US and China signed the Phase.1 deal in the middle of January. Overall risk conditions switched to the high Greed mode not seen since the late 2017 with commodities have been finally playing catch up – only Nat Gas, Aluminum and Corn are in Fear mode.

Macroeconomic drivers turn to neutral as the hopes for Trade Deal and monetary stimulus improved business confidence. On the other hand reduced risks make global CBs less so dovish with the Fed is starting to think how to exit its REPO stimulus gambit and the ECB is not going to cut rates anymore. Chinese and EM economies stabilized with downside risk.  

Investors’ interest in commodities was really high over the last months. But it was concentrated in retail investors’ money flow as trading activity in commodity futures declined and net positioning improved moderately with Precious metals and Gasoline are the most overbought and Aluminum, Zinc and Nat. Gas are the most oversold

Aluminum industry finished the year in relatively depressed mood as the most hated metal in the LME with rising inventories and switching to surplus market as additional capacity to come on line over the next couple of years without corresponding demand growth. However we see a real chance for positive surprise both in demand (“green push”) and supply (cut back) 

Alcoa was the main headliner of that industry challenges as it was the first to report full year results and predict another surplus year not only for aluminum industry but for alumina and bauxite as well. As a result valuation discount to its AWAC based valuation reached extreme levels paving the way for value accretive actions from the company via sale/spin-offs 

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Oil Market Report - November 2021

Crude oil prices rallied in October 2021, mainly driven by worries about the supply turmoil in the Europe’s and Asia’s power sector ahead of the winter season, and soaring energy prices, particularly for gas and coal, to historically high levels in Europe and Asia. Investors’ sentiment turned bullish on higher oil demand growth in the winter months from gas to oil switching, particularly in power generation and the refining and petrochemical sectors. Industry sources estimated that surging natural gas prices could boost oil demand by 0.5 mln bbl / d on average from September 2021 through 1Q22. 

oil, investment

Banking Sector Monthly Report - October 2021

US banks underperformed slightly in October 2021 despite their strong absolute performance, the first time of weaker performance vs the broad market over the last three months. Thus, BKX index increased by 6.3% MoM vs +6.9% MoM of SPX index, the third consecutive month of growth in absolute terms. 

investment, banks;


What has happened with EU gas market (and in less extent globally) in 2021,which lead to 100% + increase in natural gas prices? We should, first of all, focus on the natural factors and the mostly non-professional reaction of the EU regulators (and the governments of some countries) on the problem, raised in the current year. The main reasons for the temporary shortage and the huge gas price jump in 2021

gaz, oil, investment