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The Zacks Analyst Blog Highlights Anglo American, Nutrien, Occidental Petroleum and JPMorgan
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For Immediate Release
Chicago, IL – March 29, 2022 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Anglo American (NGLOY - Free Report) , Nutrien (NTR - Free Report) , Occidental Petroleum (OXY - Free Report) and JPMorgan (JPM - Free Report) .
Here are highlights from Monday’s Analyst Blog:
Q1 Ending: Global Week Ahead
There is a novelty to this Global Week Ahead: This week's end is the end of the first quarter of 2022 and the end of month too. It also marks the start of the Spring quarter.
As is typical at the end of any month, Friday offers traders a fresh monthly U.S. nonfarm payroll number for March.
Yet the U.S. Federal government does not have much time to prepare this number. So, expect the downstream job addition revisions to be quite large.
And other financial market and geopolitical dynamics are likely going to be trumping that Friday macro print.
You rarely see that.
What has Reuters' staff written on this week?
As a tumultuous quarter approaches its end, markets will watch U.S. and Eurozone data to gauge just how aggressive central banks might get in their fight against inflation.
Also in focus will be Europe's dilemma whether or not to sanction Russian energy exports, potentially causing further price surges and economic difficulty.
Here are Reuters' five key global themes, reordered for equity traders.
(1) Q1 ends this week. How was Q1 of 2022 for stocks and other assets?
The first quarter of 2022 was one most investors would prefer to forget.
Except, of course, those trading oil, metals or grains, who would have rejoiced in Brent crude soaring over +50%, and a +30% gain for the CRB commodities index.
It was less rewarding on equities; with a -5% loss, the S&P500 looks set to break a seven-quarter winning streak. Nasdaq Eurozone stocks fared worse while Chinese markets had to cope with renewed COVID-linked lockdowns in many cities.
Bond markets hit milestones unseen, in some cases, for decades. The 140 basis-point rise in two-year U.S. yields is the biggest since mid-1984; the German equivalent will post its largest quarterly rise since 2011.
This is unsurprising, given central bankers' acknowledgement that inflation is not after all transitory and interest rates need to rise. Global inflation will hit 6.3% this quarter, the fastest rise in a quarter century, JPMorgan estimates.
Finally, pity those who failed to exit Russia investments on time -- with the country being ejected from equity and bond indexes, they will need to mark their holdings to zero.
(2) Sanctions on Russian oil and gas flows are costly
Targeting Russian energy, as the United States and Britain have done, is one of the most powerful levers the European Union could pull to punish Moscow for its invasion of Ukraine. But it remains a divisive choice for the bloc which relies on Russia for 40% of its gas and reeling from a surge in fuel prices.
But as pressure grows to announce a ban, there's been a new twist -- President Vladimir Putin's demand that "unfriendly" countries need to pay for gas in roubles is raising yet more concerns about Europe's energy crunch.
EU leaders could soon agree to buy gas jointly and secure additional U.S. gas supplies. But in the meantime, the debate is causing unease in all kinds of quarters. Oil producing group OPEC, for one, has warned the move could hurt consumers.
(3) Mainland China's property company woes are making fresh headlines
China's pledge not to roll out a property tax offers only short-term relief to developers, struggling with debt restructuring and access to finance.
Evergrande, the poster child for the sector's difficulties, has revealed new problems at a key subsidiary, and will not publish audited results by the March 31 deadline.
Another embattled developer Kaisa said the same, though others such as China Vanke, Country Garden and Sunac China plan to publish annual results next week.
Developers' shares and Chinese high yield bonds remain under pressure. The property sector woes will remain on investors' must-watch list until some real relief measures emerge.
(4) Nonfarm payrolls for March hit on Friday, April 1st
Is the Federal Reserve's aggressive trajectory for tightening monetary policy too hawkish, or not hawkish enough? Friday's March U.S. jobs report might show.
Economists polled by Reuters expect 450,000 new jobs were created, versus 678,000 in February.
Hiring far above those estimates will strengthen the case for a 50 basis-point interest rate hike in May. After all, Fed Chairman Jerome Powell has signaled readiness to make a big move if needed.
Despite that, the S&P500 has managed to nearly halve its year-to-date losses. But watch the U.S. Treasury yield curve, which is getting close to inversion as investors fret about a Fed-induced recession. The bond market rarely gets it wrong.
(5) Eurozone inflation estimates for March arrive on Friday
When first estimates of March Eurozone inflation emerge on Friday, they may test the European Central Bank's narrative that there's no rush to raise interest rates.
Inflation is already at a record high 5.9% and could hit 7% in the coming months. Given the ECB target of 2%, it's unsurprising that some officials are urging one or even two rate moves this year.
A strong inflation print will strengthen their case. But bond markets too suggest higher rates are coming, having priced five moves of 10 bps each by year-end.
Germany's two-year bond yield is up 30 bps in March, set for its biggest monthly rise since 2011. Having spent years deep in negative yield territory amid ECB bond buying to boost inflation, it is fast approaching 0%. That's significant.
Top Zacks #1 Rank (STRONG BUY) Stocks
There are top Zacks Growth scores accompanying a number of commodity, fertilizer and energy stocks now. These dominate our #1 list at the moment.
Here are three big stock tickers to follow up on:
(1) Anglo American : Commodities are hot. This is a $66.5B market cap mining stock. I see a Zacks Value score of B, a Zacks Growth score of B and a Zacks Momentum score of C.
(2) Nutrien : Fertilizer prices are skyrocketing. This is a $59.8B market cap fertilizer stock. I see a Zacks Value score of C, a Zacks Growth score of A and a Zacks Momentum score of F.
(3) Occidental Petroleum: Oil prices are in triple-digits. This is a $54.8B market cap integrated oil and gas producer. I see a Zacks Value score of C, a Zacks Growth score of A, and a Zacks Momentum score of A.
Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.
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The Zacks Analyst Blog Highlights Anglo American, Nutrien, Occidental Petroleum and JPMorgan
For Immediate Release
Chicago, IL – March 29, 2022 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Anglo American (NGLOY - Free Report) , Nutrien (NTR - Free Report) , Occidental Petroleum (OXY - Free Report) and JPMorgan (JPM - Free Report) .
Here are highlights from Monday’s Analyst Blog:
Q1 Ending: Global Week Ahead
There is a novelty to this Global Week Ahead: This week's end is the end of the first quarter of 2022 and the end of month too. It also marks the start of the Spring quarter.
As is typical at the end of any month, Friday offers traders a fresh monthly U.S. nonfarm payroll number for March.
Yet the U.S. Federal government does not have much time to prepare this number. So, expect the downstream job addition revisions to be quite large.
And other financial market and geopolitical dynamics are likely going to be trumping that Friday macro print.
You rarely see that.
What has Reuters' staff written on this week?
As a tumultuous quarter approaches its end, markets will watch U.S. and Eurozone data to gauge just how aggressive central banks might get in their fight against inflation.
Also in focus will be Europe's dilemma whether or not to sanction Russian energy exports, potentially causing further price surges and economic difficulty.
Here are Reuters' five key global themes, reordered for equity traders.
(1) Q1 ends this week. How was Q1 of 2022 for stocks and other assets?
The first quarter of 2022 was one most investors would prefer to forget.
Except, of course, those trading oil, metals or grains, who would have rejoiced in Brent crude soaring over +50%, and a +30% gain for the CRB commodities index.
It was less rewarding on equities; with a -5% loss, the S&P500 looks set to break a seven-quarter winning streak. Nasdaq Eurozone stocks fared worse while Chinese markets had to cope with renewed COVID-linked lockdowns in many cities.
Bond markets hit milestones unseen, in some cases, for decades. The 140 basis-point rise in two-year U.S. yields is the biggest since mid-1984; the German equivalent will post its largest quarterly rise since 2011.
This is unsurprising, given central bankers' acknowledgement that inflation is not after all transitory and interest rates need to rise. Global inflation will hit 6.3% this quarter, the fastest rise in a quarter century, JPMorgan estimates.
Finally, pity those who failed to exit Russia investments on time -- with the country being ejected from equity and bond indexes, they will need to mark their holdings to zero.
(2) Sanctions on Russian oil and gas flows are costly
Targeting Russian energy, as the United States and Britain have done, is one of the most powerful levers the European Union could pull to punish Moscow for its invasion of Ukraine. But it remains a divisive choice for the bloc which relies on Russia for 40% of its gas and reeling from a surge in fuel prices.
But as pressure grows to announce a ban, there's been a new twist -- President Vladimir Putin's demand that "unfriendly" countries need to pay for gas in roubles is raising yet more concerns about Europe's energy crunch.
EU leaders could soon agree to buy gas jointly and secure additional U.S. gas supplies. But in the meantime, the debate is causing unease in all kinds of quarters. Oil producing group OPEC, for one, has warned the move could hurt consumers.
(3) Mainland China's property company woes are making fresh headlines
China's pledge not to roll out a property tax offers only short-term relief to developers, struggling with debt restructuring and access to finance.
Evergrande, the poster child for the sector's difficulties, has revealed new problems at a key subsidiary, and will not publish audited results by the March 31 deadline.
Another embattled developer Kaisa said the same, though others such as China Vanke, Country Garden and Sunac China plan to publish annual results next week.
Developers' shares and Chinese high yield bonds remain under pressure. The property sector woes will remain on investors' must-watch list until some real relief measures emerge.
(4) Nonfarm payrolls for March hit on Friday, April 1st
Is the Federal Reserve's aggressive trajectory for tightening monetary policy too hawkish, or not hawkish enough? Friday's March U.S. jobs report might show.
Economists polled by Reuters expect 450,000 new jobs were created, versus 678,000 in February.
Hiring far above those estimates will strengthen the case for a 50 basis-point interest rate hike in May. After all, Fed Chairman Jerome Powell has signaled readiness to make a big move if needed.
Despite that, the S&P500 has managed to nearly halve its year-to-date losses. But watch the U.S. Treasury yield curve, which is getting close to inversion as investors fret about a Fed-induced recession. The bond market rarely gets it wrong.
(5) Eurozone inflation estimates for March arrive on Friday
When first estimates of March Eurozone inflation emerge on Friday, they may test the European Central Bank's narrative that there's no rush to raise interest rates.
Inflation is already at a record high 5.9% and could hit 7% in the coming months. Given the ECB target of 2%, it's unsurprising that some officials are urging one or even two rate moves this year.
A strong inflation print will strengthen their case. But bond markets too suggest higher rates are coming, having priced five moves of 10 bps each by year-end.
Germany's two-year bond yield is up 30 bps in March, set for its biggest monthly rise since 2011. Having spent years deep in negative yield territory amid ECB bond buying to boost inflation, it is fast approaching 0%. That's significant.
Top Zacks #1 Rank (STRONG BUY) Stocks
There are top Zacks Growth scores accompanying a number of commodity, fertilizer and energy stocks now. These dominate our #1 list at the moment.
Here are three big stock tickers to follow up on:
(1) Anglo American : Commodities are hot. This is a $66.5B market cap mining stock. I see a Zacks Value score of B, a Zacks Growth score of B and a Zacks Momentum score of C.
(2) Nutrien : Fertilizer prices are skyrocketing. This is a $59.8B market cap fertilizer stock. I see a Zacks Value score of C, a Zacks Growth score of A and a Zacks Momentum score of F.
(3) Occidental Petroleum : Oil prices are in triple-digits. This is a $54.8B market cap integrated oil and gas producer. I see a Zacks Value score of C, a Zacks Growth score of A, and a Zacks Momentum score of A.
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Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.