Alrightee, so let’s trundle along a similar path to the last post with another bunch of tidbits. But these ones have a theme – that of being BIG numbers which are defining, dictating, and dominating current markets.
1) After yesterday’s 2.9 million barrel build, US crude inventories now sit at over 387 million barrels – a 22-year high. Lest we forget, there is also circa 700 million barrels sitting in the strategic petroleum reserve (SPR)
2) Greek and Spanish youth unemployment rates (= under 25 years old) are both over 50%
3) The Federal Reserve announced yesterday it is extending ‘Operation Twist’ through 2012 to the tune of $267 billion, which means selling near-term debt and buying longer-term debt to keep borrowing costs low, stimulating lending / spending
4) Opec said its production reached 32,964,000 barrels a day in April, its highest level since 2008
5) JPMorgan’s trading losses from ‘the London whale‘ are estimated at over $2 billion, although this number will likely be higher by the time the company reports earnings on July 13
Some of the trades involved are being unwound this week, with a record $31 billion traded on Tuesday on the index involved in the trades (versus a daily average of $2.4 billion). Big bets mean big losses mean big numbers
6) Greek 10-yr government bonds are yielding 27%, a number which indicates impending default (or a huge bargain, if you are the ultimate glass half full type of person)
7) Charter rates for VLCCs (very large crude carriers) have fallen 76% in 11 weeks amid fears that falling oil prices mean producers will cut back on supply
8) The four-week average for initial jobless claims in the US has risen to its highest level this year at 386,250. This points to renewed weakness in the labor market, something we are seeing affirmed by Nonfarm payroll data
9) Temperatures in the Northeast have been making record highs this week, reaching 98 degrees in Newark, NJ. With sweltering heat across a good swath of the US , stronger cooling demand points frantically to a lowly natural gas storage injection next week versus benchmarks
10) China imported a record 6 million barrels of oil in May, which is 18% more than a year ago. The emerging market is expected to ramp up imports given the fall in prices since the beginning of May (hark, -24%…another big number) as it looks to complete a 170 million barrel strategic petroleum reserve, of which it has already filled 40 million barrels
Thanks for playing…BIG time!