Are oil and stocks really correlated? Ben Bernanke thinks so, and he thinks he knows why.
In his latest blog post over at Brookings, the former Federal Reserve chairman and his research assistant, Peter Olsen, dig into the relationship between oil and stock prices, and try to solve a market conundrum: Are the two asset classes really correlated? In other words, does the movement in one effect the other, and if so, why?
The relationship was ironclad last week: on Thursday, markets were plunging, striking fresh lows and threatening to pitch completely downward. Then, headlines started crossing the wires that suggested OPEC was ready to start talking about production cuts. On a dime, oil turned around, and stocks followed. After that came a sharp three-day rally for both.
It’s isn’t always that tight, but lately it’s been close. In 2015, oil and stocks both closed down on the same day more often than ever, more than 85 days out of the 252 trading sessions. The relationship has been tighter since the financial crisis. Before the crisis, there was no discernible correlation between the two, a report from the Cleveland Fed concluded, back in 2008. Things have obviously changed since then.
Top Consumer Service Stocks To Watch Right Now: HD Supply Holdings, Inc.(HDS)
HD Supply Holdings, Inc. operates as an industrial distributor in North America. The companys Facilities Maintenance segment offers electrical and lighting items, plumbing, appliances, janitorial supplies, hardware, kitchen and bath cabinets, window coverings, textiles and guest amenities, healthcare maintenance, and water and wastewater treatment products, as well as heating, ventilating, and air conditioning products. Its Waterworks segment provides pipes, fittings, valves, hydrants, and meters for use in the construction, maintenance, and repair of water and waste-water systems, as well as fire-protection systems; and smart meters, fusible piping solutions, and engineered treatment plant products and services. The companys Power Solutions segment distributes electrical transmission and distribution products, and power plant maintenance, repair, and operations supplies and smart-grid products; and arranges materials mana gement and procurement outsourcing for the power generation and distribution industries. Its Construction & IndustrialWhite Cap segment offers tilt-up brace systems, forming and shoring systems, concrete chemicals, hand and power tools, rebar, ladders, safety and fall arrest equipment, screws and fasteners, sealants and adhesives, drainage pipes, geo-synthetics, erosion and sediment control equipment, and other engineered materials. The company also provides floorings, cabinets, countertops, and window coverings, as well as design center services; and light remodeling and construction supplies, kitchen and bath cabinets, windows, plumbing materials, electrical equipment, and other products. It serves contractors, maintenance professionals, home builders, industrial businesses, and government entities. The company was formerly known as HDS Investment Holding, Inc. and changed its name to HD Supply Holdings, Inc. in April 2013. HD Supply Holdings, Inc. is headquartered in At lanta, Georgia.
- [By Monica Gerson]
HD Supply Holdings Inc (NASDAQ: HDS) is projected to report its quarterly earnings at $0.24 per share on revenue of $1.63 billion.
JA Solar Holdings Co., Ltd. (ADR) (NASDAQ: JASO) is estimated to report its quarterly earnings at $0.68 per share on revenue of $683.29 million.
- [By Ben Levisohn]
Flexing the barbell strategy to balance Safe Havens with more cyclical exposures. In our view, industrials investors should be positioning their portfolio with a barbell strategy, with half of the exposure in Safe Havens like General Electric, Xylem (XYL), Danaher, Honeywell International, Roper Technologies (ROP), and AMETEK (AME), and the other half selectively in the cyclical names that are better positioned today, such as Pentair, HD Supply Holdings (HDS),Actuant (ATU), Atkore International Group (ATKR), Ingersoll-Rand, and Eaton (ETN). We still believe risk-reward is mostly balanced and that the macro will remain choppy into 2017, supporting a positioning in the defensive names. But if investor sentiment improves on not-worse news and earnings results, the more cyclical names could fare better.
Top Consumer Service Stocks To Watch Right Now: Norwegian Cruise Line Holdings Ltd.(NCLH)
Norwegian Cruise Line Holdings Ltd. operates as a cruise line company that offers various itineraries. It offers cruises ranging from 1 day to 180 days itineraries to approximately 510 destinations worldwide. The company offers its products through independent travel agents, wholesalers, and tour operators. It operates 22 ships under the Norwegian Cruise Line, Oceania Cruises, and Regent Seven Seas Cruises brands with approximately 45,000 Berths. The company was founded in 1966 and is headquartered in Miami, Florida.
- [By Monica Gerson]
Norwegian Cruise Line Holdings Ltd (NASDAQ: NCLH) is expected to report its quarterly earnings at $0.37 per share on revenue of $1.10 billion.
Jazz Pharmaceuticals plc (NASDAQ: JAZZ) is projected to post its quarterly earnings at $2.31 per share on revenue of $338.86 million.
- [By Ben Levisohn]
Shares of Carnival have dropped 4.2% to $43.74 at 2:39 p.m. today, while Royal Caribbean Cruise (RCL) has tumbled 5.6% to $66.15, and Norwegian Cruise Line Holdings (NCLH) is off 4.3% at $38.63.
Best Long Term Companies To Own In Right Now: United Dominion Realty Trust, Inc.(UDR)
UDR, Inc., incorporated on May 2, 2003, is a real estate investment trust. The Company owns, operates, acquires, renovates, develops, redevelops and manages multifamily apartment communities generally located in various markets across the United States. The Company operates through two segments: Same-Store Communities and Non-Mature Communities/Other. The Company’s consolidated real estate portfolio includes approximately 130 communities located in over 20 markets, with a total of approximately 40,730 completed apartment homes. The Company holds an ownership interest in approximately 30 communities containing over 6,700 apartment homes through unconsolidated joint ventures or partnerships.
The Company is engaged in the development of a community with approximately 520 apartment homes and over four unconsolidated joint venture communities with approximately 1,170 apartment homes. The Company’s properties are located in various areas, such as Orange County, San Francisco, Los Angeles and Monterey Peninsula in California; Seattle, Washington; Portland, Oregon; Baltimore, Maryland; Richmond, Virginia; Orlando, Florida; Nashville, Tennessee; Boston, Massachusetts, and Dallas and Austin in Texas. The Company conducts its operations primarily though United Dominion Realty, L.P.
- [By Monica Gerson]
UDR, Inc. (NYSE: UDR) is expected to post its quarterly earnings at $0.43 per share on revenue of $234.80 million.
Everest Re Group Ltd (NYSE: RE) is projected to post its quarterly earnings at $5.57 per share on revenue of $1.35 billion.
Top Consumer Service Stocks To Watch Right Now: Ascent Capital Group, Inc.(ASCMA)
Ascent Capital Group, Inc., through its subsidiary, Monitronics International, Inc., provides security alarm monitoring and related services to residential and business subscribers in the United States and Canada. The company monitors signals arising from burglaries, fires, medical alerts, and other events through security systems at subscribers premises. It offers a range of residential security services, including hands-free two-way interactive voice communication with the monitoring center, cellular options, and an interactive service option, which allows the customer to control their security system remotely using a computer or mobile device. The company also provides third party contract monitoring services to other security alarm companies for monitoring their accounts on a wholesale basis. It markets and sells its products through a network of authorized dealers. The company was formerly known as Ascent Media Corporat ion and changed its name to Ascent Capital Group, Inc. in July 2011. Ascent Capital Group, Inc. was incorporated in 2008 and is based in Greenwood Village, Colorado.
- [By Ian Wyatt, Publisher & Chief Investment Strategist, Wyatt Investment Research]
Both of these stocks are overlooked, undervalued, and cash flow machines. The companies are Ascent Capital Group (ASCMA) and Covanta Holdings (CVA).