Fuller Treacy Comment of the Day

Comment of the Day

 

Big Picture Long-Term video April 29th 2022

A link to this week’s Big Picture Long-Term video is posted in the Subscriber’s Area. 

Point and Figure Charts for FANGMANT

My view – P&F charts don’t typically have time stamps, but the following charts incorporate at least 20 years of data where relevant. P&F charts only measure the movement in price up and down. We typically use 3 box reversals. That means the column will proceed to rise or fall until the price move three units of scale in the opposite direction on a closing basis. The benefit of P&F charts is they cut out the noise of inert ranges.

Exxon Triples Share Buybacks to $30 Billion as Profits Soar

This article from Bloomberg may be of interest to subscribers. Here is a section: 

Exxon Mobil Corp. tripled its share-buyback program to as much as $30 billion after profits surged amid Russia’s invasion of Ukraine and a rally in worldwide energy prices.

The repurchases will be made through the end of next year, Exxon said in a statement on Friday. The oil giant more than doubled first-quarter adjusted net income to $8.8 billion, or $2.07 a share, lagging estimates by 17 cents.

Chief Executive Executive Darren Woods cited a dip in output from oil and natural gas wells stemming from adverse weather and other factors. Exxon rose 0.3% to $87.43 at 9:33 a.m. in New York.

The oil giant took a $3.4 billion writedown due to its planned exit from its Sakhalin-1 operation in Russia, compared with a previously announced estimate of as much as $4 billion. The company declared force majeure at the venture earlier this week and curtailed crude production. 

Exxon follows TotalEnergies SE and Chevron Corp. in posting first-quarter results. The French oil titan pledged to buyback as much as $3 billion in shares before the end of June while Chevron disclosed its biggest profit in almost a decade.   

My view – In an environment where pandemic padding of balances in the tech sector rapidly waring thin, the energy sector hasn’t had a year this good in decades. In times of uncertainty, when interest rates are rising and geopolitical threats are mounting, the reliability of strong cashflows, rising dividends and a thinning supply of stock will be welcomed by investors.

Bank of Russia Rejects Ruble-Gold Peg Idea, Differs With Kremlin

This article from Bloomberg may be of interest to subscribers. Here it is in full:

Bank of Russia Governor Elvira Nabiullina dismissed the idea of pegging the ruble to gold after the Kremlin said it was a proposal under consideration.

“It is not being discussed in any way,” Nabiullina told reporters at a briefing Friday after the central bank cut the key interest rate by 300 basis points. The ruble must continue to have a floating exchange rate, she said, though volatility of the currency will be higher amid capital controls imposed after Russia began its invasion of Ukraine.

Her comment appeared to contradict President Vladimir Putin’s spokesman, Dmitry Peskov, who said earlier Friday that “this question is now being discussed.” Peskov pointed to comments by Security Council Secretary Nikolai Patrushev on linking the currency to gold and other commodities in an interview with a state-run newspaper this week, while offering no further details.

Unprecedented sanctions on Russia’s central bank over the invasion of Ukraine deprived it of access to about half of its holdings, leaving it in possession of only gold and yuan. Before the war, Putin repeatedly argued that Russia needs to cut dependence on the dollar as a global reserve currency.

Speculation has been rife that sanctions on Russia may herald a far-reaching shift that could bolster bullion. Analysts like Credit Suisse Group AG (NYSE:CS)’s Zoltan Pozsar predict that the seizure of the central bank’s foreign exchange reserves will result in a new monetary paradigm where gold plays a greater role.

Speaking with Rossiyskaya Gazeta, Patrushev said experts are examining proposals to back the ruble’s value with gold and other goods as part of an alternative system of finance that guarantees a measure of sovereignty and reduces the link to the dollar.

Continuing a multi-year effort to reduce exposure to the U.S. currency, the Russian central bank cut the share of dollars in reserves to 10.9% as of Jan. 1 from from 21.2% a year earlier. Gold was down slightly at 21.5%.

Until the invasion of Ukraine forced Nabiullina to enact capital controls, the ruble was allowed to trade freely since 2014, its value determined by the market. 

My view – Demanding payment for commodity exports in Rubles is a major escalation of the stress Russia is imposing on the EU and the rest of the world. China speaking of its relationship with Russia as a new model for world order is an additional signal that conditions are not about to go back to the pre pandemic equilibrium

Eoin’s personal portfolio: fixed income investment position initiated April 27th

One of the questions subscribers as most often is how to find details of my open trades. To make it easier I will simply repost the latest summary daily until there is a change.

The Chart Seminar June 6th & 7th in London

Now in its 53rd year, the first venue for The Chart Seminar in the post pandemic era will be in London on June 6th and 7th at the Army & Navy Club.

To reserve your place please contact Sarah@fullertreacymoney.com.

Delegate Rates:

Full fee: £1799

Each additional delegate: £850

Fuller Treacy Money Subscriber rate: £850

Prices exclude VAT where applicable