“Energy” is outperforming every other sector this year but Karen Firestone (Aureus Asset Management) says these stocks are not worth owning from here and out.
OPEC+ to consider cutting oil production
Over the past six months, oil prices have lowered about 35%.
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Consequently, OPEC+ is expected to agree on taierea productiei by more than a million barrel per day at its meeting on October 5th. Still, Firestone said on CNBC’s „Raport la pauză”:
Maybe they will and maybe they won’t. Maybe they’ll try it and maybe there’ll be a resolution in the Ukraine. These are all unknowables. So, I wouldn’t jump in here just because it looks like the winter is going to be tough.
“IEO” – the iShares U.S. Oil & Gas Exploration and Production ETF is already up more than 35% for the year.
Energy stocks are not good for a recession
Stocuri de energie are all the more attractive to investors for the lucrative dividend. But the looming recession, Firestone warned, is a bigger risk than dividend is a reward.
There are cycles. We have been in an up cycle for energy. But they can stop outperforming the market particularly when demand falls. And if we’re having a recession globally, demand is not going to hold up.
Last month, Fed Chair Jerome Powell de acord the chances of a “soft landing” were rather slim.
A push to electrify the economy remains a long-term headwind for the legacy players as well. Firestone no longer has exposure to “energy” in her portfolio.
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68% din conturile CFD cu amănuntul pierd bani