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- 🔔 Biden begs OPEC, a Dovish taper, and hidden infrastructure winners
🔔 Biden begs OPEC, a Dovish taper, and hidden infrastructure winners
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CPI was released an hour or so ago.
Nothing much to get excited about, and from a monetary perspective not going to change any minds...
Fed members have been very chatty lately, and one way or another the taper announcement is coming later this year.
They are not ready to give up on flexible average inflation targeting any time soon...
It's probably going to be the most dovish taper you could imagine 👇👇👇
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Pleeeeeease, OPEC. Don't charge us so much, we're poor...
I tried the same tactic with the electric company, and they told me to p*ss off.
Which is exactly what OPEC+ will do when they see that report!
“The president recognizes that gas prices can put a pinch on the family budget,” a senior White House official said. “He’d like his administration to use whatever tools that it has to help address the cost of gas, to help bring those prices down.”
(Narrator: they have no tools)
It was hard enough for OPEC+ to reach agreement at the last meeting. There's no way they'll be changing just because Biden asks nicely.
Maybe old Joseph shouldn't have gone in so hard on the US Oil & Gas industry as soon as he took office.
Didn't see the second-order effects or didn't care?
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While we're on the subject of second-order effects, I loved this Reuters analysis 👇
Money managers snapping up shares of companies expected to benefit from infrastructure spending have already helped push up the S&P 500’s materials and industrial sectors, which have both gained around 18% year-to-date, broadly in line with the benchmark index.
Some, however, are digging deeper and delving in to areas such as certain real estate investment trusts and utilities in the search for undervalued companies that may benefit if the bill gets passed. The infrastructure package, which aims to provide the nation’s biggest investment in decades in roads, bridges, airports and waterways, secured enough votes in the Senate on Tuesday and will head to Congress in the fall.
“There’s going to be a lot of spending in areas that people don’t necessarily associate with infrastructure,” said Scott Helfstein, head of Thematic Investing at ProShares.
So, let's presume the 'lazy' investing is already done. 👇
Infrastructure = Buy materials/industrials (passively through ETF'S?). Already gained 18%, take the money and run.
Is that it? Opportunity over...?
Not if your name's John Mowrey 👇👇
John Mowrey, chief investment officer at NFJ Investment Group, has been adding to companies such as railroad operator Norfolk Southern Corp, whose shares are up just 9% for the year, betting the company’s revenue will increase significantly as construction materials are shipped across the country. The company’s price to earnings ratio stands near a 52-week low.
He is also buying shares of companies like utility American Water Works Company Inc because of its expected benefits from the infrastructure bill.
“They are getting the chance to update their systems from public spending as opposed to having to fund it all internally,” he said.
Sometimes stocks are cheap for a reason. Other times they fly under everyone's radar (until they talk their book to Reuters)
