Entries by Simon Lack

Inflation Fears Moderate

SL Advisors Talks Markets
SL Advisors Talks Markets
Inflation Fears Moderate







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Maybe last week’s FOMC minutes had something for everyone. Some analysts seized on the consideration the Fed gave to tighter monetary policy: “They also noted that a restrictive stance of policy may well become appropriate depending on the evolving economic outlook and the risks to the outlook.”  On the other hand, the minutes noted that, […]

ESG Has No Clothes

SL Advisors Talks Markets
SL Advisors Talks Markets
ESG Has No Clothes







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Offering investments tailored to ESG (Environmental, Social and Governance) criteria is a growing source of fee income for Wall Street. Morningstar calculates that 65 US funds have been repackaged into ESG funds since the beginning of 2019. Investors are attracted by the notion of holding virtuous stocks, but companies and fund managers must also find […]

Pipeline Sector Extends Outperformance

SL Advisors Talks Markets
SL Advisors Talks Markets
Pipeline Sector Extends Outperformance







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The continued rally in the energy sector is steadily lifting past performance ahead of the S&P500 over multiple timeframes. The American Energy Independence Index (AEITR) now has a higher annual return than the S&P500 over the past one, two and three years. Even over five years the performance gap is closing. The 12.3% pa return […]

Different Audience, Different Energy Policy

SL Advisors Talks Markets
SL Advisors Talks Markets
Different Audience, Different Energy Policy







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Last week’s Economist magazine included an illuminating op-ed by Nigeria’s vice-president on “the hypocrisy of rich countries’ climate policies.” Like most emerging countries, Nigeria is simultaneously pursuing two goals; improving the access of Nigerians to energy, while reducing the country’s Greenhouse Gas (GHG) emissions. Vice-president Yemi Osinbajo’s essay neatly captures the dilemma his and other […]

A Good Week For The Fed

SL Advisors Talks Markets
SL Advisors Talks Markets
A Good Week For The Fed







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Financial advisors probably feel that they’re more than earning their pay recently. Market volatility is high, which means clients want to know what’s going on. Advisors have in the past confided to me that one of their most important roles is to persuade clients from selling impetuously. Their original asset allocation was made after much […]

Pipelines Are Less Volatile Than You Think

SL Advisors Talks Markets
SL Advisors Talks Markets
Pipelines Are Less Volatile Than You Think







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If it feels like the market’s daily swings are giving you whiplash, you’re right. Following Monday’s rout, the number of daily moves in excess of 1% breached 50% over the past hundred days. In other words, a 1% or greater change in the S&P500 is now more likely than not. This is unusual. Markets were […]

High-Energy Earnings Boost Pipelines

SL Advisors Talks Markets
SL Advisors Talks Markets
High-Energy Earnings Boost Pipelines







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Earnings for pipeline companies are generally devoid of excitement unless steady growth gets you animated, such is the stability of most business models. But 1Q22 earnings were full of positive surprises. Cheniere (CEI) blew away expectations with 1Q22 EBITDA 65% ahead of consensus. Most of their Liquefied Natural Gas (LNG) contracts are based on a […]

Why The Fed’s Critics Will Become More Vocal

SL Advisors Talks Markets
SL Advisors Talks Markets
Why The Fed’s Critics Will Become More Vocal







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The ten year treasury yield touching 3% has drawn headlines, but the bigger story is that the increase in nominal yields has been driven by rising real yields. Ten year TIPs yield 0.18%, the first time they’ve been positive in over two years. Until recently, real yields had been declining irregularly for decades. $TNs of […]

Why Recession Fears Can Help Energy Stocks

SL Advisors Talks Markets
SL Advisors Talks Markets
Why Recession Fears Can Help Energy Stocks







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Last week recession questions were more common than in the past during our many conversations with clients. The likely performance of the energy sector during a slowdown is what they’re asking. Recession risks are growing in the minds of many. In one recent survey, a third of economists are forecasting a recession within two years. […]

Pipelines — There’s Always A Bull Market Somewhere

SL Advisors Talks Markets
SL Advisors Talks Markets
Pipelines -- There’s Always A Bull Market Somewhere







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The US was increasing its net exports of natural gas before Russia’s invasion of Ukraine added an element of urgency. Liquefied Natural Gas (LNG) gets most of the attention, but this year we’ll export nine Billion Cubic Feet per Day (BCF/D) by pipeline, to Mexico and eastern Canada. LNG exports are still rising, with most […]

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