The energy crisis and the storm of interest rate hikes are still the focus of market attention!
Europe is staging a magical scene: full sanctions on Russia while frantically importing Russian crude oil.
Bloomberg's analysis based on ship tracking data shows that in the week to September 2, Europe imported about 1 million barrels per day of Russian crude oil, a four-week high and accounted for almost a third of Russia's total crude oil exports. At the same time, the EU is preparing sanctions on Russian gas, planning to put a cap on the price of Russian gas exported to the EU. In response, Russian President Vladimir Putin responded that if Western countries implement price limit measures, Russia may cut off all energy supplies to it.
At the critical moment, the Fed's "interest rate hike storm" once again sent early warning signals. Goldman Sachs abruptly raised fed rate hikes: 75 basis points in September and 50 basis points in November; In addition, the Wall Street Journal, known as the "Fed News Agency", expects the Fed to raise rates for the third consecutive 75 basis points in September. Fed Chairman Jerome Powell also reiterated in his latest speech that insisting on raising interest rates until the anti-inflation campaign is completed and that strong action is needed now.
In the face of the Fed's continuous "interest rate hike storm", Wall Street's "tech queen" and "female version of Buffett" Catherine Wood seem to be nervous.
On Wednesday, local time, Wood directly shelled Fed Chairman Powell, arguing that high inflation in the United States is turning into deflation, and powell wants to emulate Volcker's aggressive interest rate hikes, which is a complete mistake. It is worth mentioning that under the storm of interest rate hikes, the ARK flagship fund managed by Wood has fallen by more than 56% during the year.
A magical scene in Europe
Europe is staging an embarrassing scene: "tearfully" buying Russian crude oil.
On September 7, local time, Bloomberg reported that analysis based on ship tracking data showed that in the week ended September 2, Europe's oil imports to Russia reached 1 million barrels per day, a new 4-week high. That's up from 890,000 bpd in August, according to data released on Monday.
Russian crude shipments to Northern Europe increased by 20 percent in the week ended Sept. 2, especially shipments to the Netherlands, home to Europe's main Amsterdam-Rotterdam-Antwerp refinery center, up 13 percent from a week earlier, the data showed. Shipments to Asia remained stable.
Currently, Russia exports about 3.32 million barrels of crude oil a day by sea, meaning that a third of it is bought by Europe.
Behind Europe's frenzied imports of Russian oil is that the EU ban on Russian crude oil will be implemented from December 5, less than three months ago.
As a result, most European countries are racing against time, frantically importing crude oil from Russia, hoping to fill up the tanks when the ban officially goes into effect.
In addition, the current international oil prices have seen a sharp correction, which has further stimulated the enthusiasm of European countries to hoard Russian oil. On September 8, Brent crude fell 4.6% to $88.5 a barrel, a seven-month low and the first time since February this year that it fell below $90 a barrel; WTI crude plunged 5.2 percent to $82.37 a barrel, its lowest level since January.
India seems unable to sit still about Europe's frenzied import of Russian oil. On Monday, local time, Indian Oil Minister Shri Hardeep Singh Puri said that European countries imported More Russian crude oil in one afternoon than India imported from Russia in one quarter.
The implication may be that when India imports Russian oil, the United States and European countries have accused and even exerted diplomatic pressure, but they are secretly importing, without weakening Russia's energy exports.
In the face of an unprecedented energy crisis, European countries are not only hoarding oil in large quantities, but the demand for almost all fossil fuels is increasing rapidly. In addition, due to soaring natural gas prices and Russia's indefinite "gas outage", some European utilities have begun to shift to generating electricity from crude oil.
The Royal Bank of Canada warned that a total cut off of natural gas from Russia would plunge Europe into an energy crisis for the coming winters, and that it would be "very expensive" for European governments to keep energy prices within their affordable range.
On September 7, local time, European Commission President Ursula von der Leyen said the European Commission would propose a cap on the price of natural gas exported to the EU by Russia (50 euros per megawatt hour). However, there is disagreement within the EU on this.
In this regard, Russian President Putin responded that the price limit on Russian natural gas is absolutely a stupid decision, if the Western countries take price limit measures on Russian natural gas, Russia may cut off all energy supplies to it.
"Hike storm" is coming?
At the critical moment, the Fed's "interest rate hike storm" once again sent early warning signals.
At present, less than 2 weeks before the Fed's September interest rate meeting, Fed Chairman Powell said on Thursday that he said at the monetary policy meeting held by the Cato Institute that he must persist in raising interest rates until the fight against inflation is completed, and history warns us not to relax our policies prematurely.
At the same time, Goldman Sachs also suddenly raised the Fed's expectations for a rate hike: 75 basis points in September and a further 50 basis points in November, up from the previous forecast of 50 basis points and 25 basis points, respectively. Goldman Sachs also expects the Fed to raise interest rates by another 25 basis points in December, and the cycle may extend beyond this year.
Goldman Sachs' forecast in the latest report is based on the fact that fed officials' remarks are very "hawkish" and seem to imply that inflation suppression is progressing less than expected.
In fact, on the eve of Goldman Sachs' above views, Fed Vice Chairman Brainard issued a warning that the Fed had to raise interest rates to restrictive levels to avoid the risk of premature retreat, while warning that risks will become more two-way in the future.
In addition, Wall Street Journal reporter Nick Timiraos, known as the "Fed News Agency", predicted in an article published on September 7 that the Fed would raise interest rates for the third consecutive 75 basis points in September, citing the Fed chairman's previous announcement to fight inflation even if the unemployment rate rises.
Currently, CME's FedWatch tool shows that the current market forecasts that the probability of the Fed raising interest rates by 75 basis points in September has risen to 80%, and the probability of a 50 basis point rate hike has dropped to 20%. This means that the Fed's renewed storm of interest rate hikes in September is almost ironclad.
Goldman Sachs economists say tightening policy will make economic growth in the second half of the year below potential. It is worth noting that Goldman Sachs suddenly changed its optimistic expectations for U.S. stocks and warned investors that the real trough of this round of U.S. stock bear market has not yet formed, and the market will be further shaken.
The "female version of Buffett" shelled
On September 7, local time, Jeremy Grantham, a veteran Wall Street investor known as a "bubble predictor", said that the current global economy is even more dangerous than the crazy housing bubble in 2007. As interest rates rise, the market has to face a valuation collapse for "extremely inflated" growth stocks, and the S&P 500 could dive from the current 3979.87 to around 3000 in a year.
In addition, the Bank of America also believes that the U.S. stock market may fall below the low set by the current bear market, and it is not the time to buy U.S. stocks, if you want to buy, you need to wait for more buy signals to appear.
In the face of the Fed's continuous "interest rate hike storm", Wall Street's "tech queen" and "female version of Buffett" Catherine Wood seem to be nervous.
On Wednesday, local time, Wood directly shelled The Federal Reserve Chairman Powell, who believes that the current high inflation in the United States is turning into deflation, and it is a complete mistake for Powell to emulate Volcker's aggressive interest rate hike, and now consumers and businesses are in shock, and the US housing market is disintegrating.
In fact, Wood is one of the worst "victims" of the Fed's interest rate hike storm, and the ARK flagship fund it manages has fallen 57% so far this year, more than double the 26% decline in the NASDAQ 100 index in the same period. According to Koyfin, only 2 of the 36 stocks in ARK's flagship ETF have generated positive returns in the past year, tesla and healthcare company Signify Health.
At the same time, market money is "abandoning" the tech queen. According to data analytics firm VettaFi, ARK's flagship fund suffered an outflow of $820 million in August, the largest outflow in nearly a year.
Editor-in-charge: Luo Xiaoxia
Proofreader: Yan Zhao