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Tuesday, 22 March 2016
Bulls Return to Energy Markets
NY Times) It was one of the darkest periods of the oil market slump. The global economy was showing fresh signs of slowing, and crude prices were collapsing so steeply that virtually every well in America was unprofitable.
But when Diamondback Energy went out to raise $226 million worth of new stock that week in the middle of January, the oil and gas company found more buyers than it could accommodate. It had to nearly double the amount of shares it sold, to four million.
Since Diamondback issued equity that day, the company’s share price has increased more than 29 percent.
Across the oil industry, investors have been placing their bets that prices have hit bottom. Risk-seeking investors like hedge funds and private equity firms, which were already lending money to struggling energy companies at high interest rates and onerous terms, are among those to have smelled opportunity in a potential comeback.
Yet some of the biggest and most successful bets on oil are being wagered by mutual funds and index funds that are scooping up plain-vanilla equity offerings like Diamondback’s deal in January.
America owes a debt to places like Williston which helped provide much needed economic support after the Great Recession. Perhaps nothing can be done to truly help boom towns like Williston – no one really has control over oil prices after all. But some actions like approving and expediting the building of new pipelines to carry crude from the Bakken to Cushing would certainly be a good start, and would be fitting way for the US to repay the debt it owes to the shale oil industry.
A dramatic unwind in the half dozen backdoor margin lending channels that had funneled an additional CNY1.5 trillion into equities brought the party to a thunderous end and by late July, the market was off by more than 30% from its peak.
Chinese officials had already begun to panic by mid-month and then, on the 27th, the bottom fell out.
“The Law Society is very concerned with the trend of expanding police powers without corresponding judicial and other safeguards,” he said. “In our view, such a trend represents an erosion of long-standing democratic institutions and individual rights.”
Mr Ulman said the laws affected a broad cross-section of the community and could be used, for example, against people protesting the removal of trees in Centennial Park.
Home resales plummet as high prices and tight inventory dog the market, bringing out more investors and fewer first-timers
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