What Is Going On With The Markets?
Have you been keeping up with the markets and stocks since the beginning of the week? If so, you’re likely well aware of the current volatility. Although the primary markets are current resting at record levels, many individual stocks have failed to gain ground. What is going on with the markets and what should you expect for the remainder of the week? One of the biggest driving factors is undeniably the price of crude oil. At the beginning of the week, crude oil was down to nearly forty dollars a barrel, but that wasn’t going to last for long. Over the course of the week, crude oil prices have continued to climb higher and higher.
As of the time of this writing, the price is right around forty-six dollars and fifty cents. Many analysts believe that oil prices could soar to sixty dollars or higher by the end of the year. This is most certainly one of the biggest driving factors for the market and has helped to increase the stock prices of oil producers. Take Penn West Petroleum for example. At one point, the company was considered to be in danger of going bankrupt and their stock had plummeted well below one dollar. However, the stock now rests above a dollar seventy. Although gas prices may drop again in the future, it is undoubtedly true that the oil recovery is well underway.
What The Federal Reserve is Contemplating
Another market influence is the Federal Reserve of the United States. The Fed’s impending decision to raise interest rates has proven to be very impactful for many companies, as well as the markets. Dragon Products has noticed concern from the energy sector, due to the Fed’s upcoming decision. Of course, there is some good news for investors. Due to the slow of inflation and the recent jobs report, it is very unlikely that the Fed will be able to justify a rate hike at this point in time. Nonetheless, the Federal Reserve chair Janet Yellen seems intent on hiking the rate at some point or another. Therefore, it is essential to be aware of the possibilities and make your plays accordingly.
Berkshire Hathaway Sells WalMart Stock
Meanwhile, Walmart’s stock fell over 1% during the day’s trading period. Much of this had to do with the decision of Berkshire Hathaway to decrease their stake in America’s biggest retailer. Meanwhile, the United States dollar has also taken a beating. The dollar has fallen to 7-week lows, when compared to the yen, euro, and the Swiss franc. This has been brought about by the slow of inflation within the country and the possibility of the Fed failing to increase the interest rate anytime soon. Also, the consumer prices index remained unchanged during last month and this definitely took a toll on the value of the USD.
Overview of the Markets
When examining the markets, it is safe to say that the performance of the market doesn’t always equate to all stocks following in suit. While the market may be at all-time highs, some individual stocks have remained stagnant or have moved very little. As for oil companies, it would seem that the sky is truly the limit over the next couple of months.