Transcripts For CNBC Street Signs 20240711

Demand under continued pandemic pressure s p global has reportedly put 44 billion on the table to buy londonbased ihs markets and tie up the data giants and mark the largest deal of the year shares jump after the german chip maker confirms advance take over talks with taiwans globwas it could create a leader in the Global Semiconductor space well, good morning, everybody. Welcome to street signs and happy monday it is the start of a new trading week, a week of new possibilities. But before we get into the show, i just want to take you to our main story thats hit overnight, and that is to do with china so, beijing has said that it hopes the u. S. Will not build barriers to cooperation. That was in response to a report that the Trump Administration is preparing to blacklist top chinese chip maker smic and oil major chinook. Washington will restrict access to customers by adding two companies to its list of firms owned or controlled by the Chinese Military according to reuters. Cnooc said it has not received any official word from washington and smic the chip maker denies it has military ties and said it would continue to work, quote, constructively and openly with u. S. Authorities. So more shots fired even though we are heading into what is the last couple of months of the Trump Administration, and yet we continue to see this titfortat on the tech side of things heat up as we head towards the end of the term it is having some ramification for some of the european chip makers you can see it is a mixed board behind me. Asml semiconductor up, where as some others are trading negative on the news. Further escalation of tension between china and u. S. In the last couple months of the year but turning to data, though, because china has extended its economic rebound with new pmi data hitting multiyear highs. Now, november factory activity rose to 52. 1 while output in the key Services Sector was at its best level in eight years. Sam has more strong numbers today were largely driven by a pickup in both domestic and overseas demand demand suggested chinas recovery and the data supporting that now reduces the likelihood of more monetary easing. But beyond that headline number, new orders rose suggesting things are holding up well domestically thanks to a boost in Infrastructure Spending by the government but it was also a good month for those new export orders as well backed by external demand, too, although a resurgence in cases globally may create some uncertainties in the next few months if there are some lockdowns. But the industrial sector has largely been supporting this economic recovery so far, and has been steadily returneding to prepandemic levels. Certainly sounded confident last week when he said chinas economy would achieve growth based on the current data. With these figures in mind economists had pointed out the high possibility now of chinas gdp growth returning to 5. 5 year on year in the fourth quarter. Now, chinas official services pmi rose to 56. 4, expanding for a ninth month as well. And the fastest pace since june 2012 now, this sector has been slower to recover than the manufacturing side of things amid lingering worries about jobs and the virus forcing consumers to tighten their belts. Things continue to improve with consumption starting to pick back up and we have seen evidence of this with strong rebound in auto sales and consumer appetite during the singles day shopping festival. But we will be watching out for that manufacturing pmi output that looks at the smaller and private firms in china nor a broader picture of chinas factory activity in singapore, im sam. Back to you. Lets take a moment to recap the trading activity we had in november it was a bumper month. Specifically in europe we had a huge outperformance year the stock 600 ending 14 higher. Ftse 100, 14 hrs higher. Italy up 25 remember this was the month we got a lot of promising vaccination results. People started looking toward next year with an inkling of optimism, maybe this is the year we can start seeing signs of reflation and normalization. On the back of that we saw a huge rotation out of some of the defenses and cyclical names into more value sectors and that really shift in rotation really picked up speed towards the end of the month now, what were seeing on this final day of the month is stock 600 is opening fairly with lackluster activity in mind. Were trading just below the flat line, slightly in negative territory. So not a lot of activity going on today bear in mind we did have a holiday week in the u. S. Towards the end of the week last week so volumes dried up a little bit in overseas markets that is the picture for stock 600 today. Pretty much split between green and red. Lets get into the individual indices. Ftse 100, all eyes focused on the index. Still no brexit breakthrough there is anticipation we may be getting something hopefully in the next couple weeks so we have to before the u. K. Formally becomes a thirdparty 11 00 p. M. December 31st. Also we are watching some of the retail names quite closely in the ftse today with news that it is entering into administration. J. D. Sports right at the top of ftse 100 on news it is potentially walking away from acquiring debanons france down a quarter of a percentage of a point. It was a strong month overall for french and all indices germany is slightly in the green up 2 10 of a percentage point while it is trading in negative territory as well. As for individual sectors, i did mention that we saw a huge move into cyclicals for the month of november and today we are seeing continuation of some of those trends weve got technology up about half a percentage point. Chemicals up about half a percentage point though on the downside, banks are suffering slightly, down 1. 3 today travel and leisure, oil and gas as well, all eyes on that important opec meeting coming up in the next couple of days we should get some more color on what the opec class members decide to visavis output cuts and whether they are extended. A big week coming up for oil and gas as well. As for u. S. Futures, lets just take a look at how the u. S. Session is shaping up. While all three of the majors are looking like theyre going to open up in the red, this despite as well recording several cup many of weeks ouple strong inflows in the space. For the month we have nasdaq and the dow and s p, all of them respectively up anywhere from 11 to 13 the russell index, Small Cap Index in the u. S. , up a fair amount, up 21 today the picture is a little more muted heading into the last day of november. As for Foreign Exchange, lets look at some of the major Currency Pairs and the big theme for the month of november has been the weakness of the u. S. Dollar. So weve seen the greenback lose some of its shine versus its counterparts not just in g 10 currencies, but emerging market currencies as well euro dollar we have trading just shy of 1. 20 now. Still moving in a positive direction. Dollar yen as well, the dollar is trading firmer versus the yen today, but again, the theme more broadly has been one of dollar weakness and then we have the pound in the u. K. For whatever reason continues to climb higher even though we dont have confirmation of a trade deal yet. Certainly a lot of expectations going into that currency pair. So lot to talk about in markets. A lot to talk about in Foreign Exchange im very happy to bring in the head of the fx spot trading from barclays ian, good morning to you thanks so much for joining our show good morning. I want to start off with a broad question really about what you see happening to the dollar from here. I think most people had been watching that 92 level closely for the xy weve broken to the downside a lot of the flight to quality risk that went into the u. S. Dollar this year has been unwound. The question is, do we keep going . Yeah, good morning. I think we can, you know i think the market is quite comfortable with that trade. I think its, you know, its an ongoing theme where, as you briefly mentioned there on reflation, it is for the market and a broad base, that is certainly where the market is believing the bigger move to come is for the dollar, dollar lower. My concern is obviously around that being quite consensus what i would say is the parties rate hasnt been extremely high. I mean, we have seen net dollar supply since the u. S. Election and its kind of made sense. People are comfortable with it, with the rhetoric. However, what i would say is i dont think it is as positioned, you know, as it potentially could be considering how consensus the trade and the view is around reflation and the dollar to continue softer. Before we talk about other currencies, i want to ask your take on the safe haven currencies here i mention a couple of them, the japanese yen, the swiss franc. It actually has been a very good year for safe haven currencies versus the u. S. Dollar both of them are about 5 to 7 firmer in light of what we discussed and in light of people turning more positive about 2021, do you think those safe haven currencies could be at risk . I mean, certainly from a traditional risk on perspective, that would be how you could view it with crossyen performing well, and euro swiss driving higher as well however, i just think if you take a step back, that would have been more in a traditional sort of carry environment where Interest Rate differentials played a big part. At the moment in the g10 space, the Interest Rate differentials are pretty low, as tight as theyve been for a long period i think actually its the broader dollar theme that is clearly overwhelmed. You even saw that if you look back at march when obviously the capitulation in the market for around covid, you actually saw dollaryen aggressively lower. Then the unwind as you saw demand for the dollar as you sort of mentioned, the flight to safe haven, was very much the dollar i think its more of a dollar world than it is, you know, a risk world or a carry driven environment because of the fact in g10 there isnt that carry any more ian, i want to hone in on whats happening in the pound. Weve seen a substantial rally in sterling versus the dollar over the last month or so, and youve just outlined what is happening on the dollar side of that trade Market Participants for the most part seem to say they expect a deal on the brexit front what does ponsitioning tell us about what the Investment Community is bracing for when it comes to brexit . Yeah, i feel thats really interesting in the respect i think the market, if you speak to many Market Participants and the broad client base we discuss with, i would say that sort of north of 70 of people expect a deal now, how heavy heavily position is less especially in the cash space as you mention, sterling against the dollar has performed well. You know, the asymmetry from here doesnt look long cable up at these levels. Playing in the cash space, it makes it very tough. However, in the volatility market, it is more positioned that way the demand weve seen is for sterling top side. I think the market outlines it quite well where you have one month vol being around the 10 mark versus one year north of 8. So clearly theres anticipation in the coming months, in the coming weeks, but getting the exact data around that is unclear. I think euro sterling upped lines the sterling performance a little bit better. Youve seen a 3 move roughly in on a trade weighted basis. And higher since september so 3 on a deal, i dont think thats huge, and i think you could see a little bit more performance from sterling. And i think as you outlined, its been the broader dollar move that is sort of makes the cable move look large. Sticking with the u. K. , but looking beyond the pound, investors have been under weight u. K. Assets for quite sometime, in part because of this brexit uncertainty, in part because things like the ftse are overexposed to sectors investors have been trying to shy away from like energy, for example. If we do get a resolution on brexit, do you expect to see a rush of inflows into u. K. Assets and if so, what does that mean for the pound . I think, you know, i think thats definitely our focus point for clients in the market, is the fact that people since 2016 have been under weight u. K. Assets, theres no doubt about it i think it should see the u. K. As an investable place again, you know, whether a brexit deal done, even if that does look somewhat skinny, and also a vaccine, it looks a very investable place again in the u. K. So i think this sterling can perform well if you look at it, you know, the brexit discount was around sort of 15 on a trade weighted basis in sterling. Therefore weve got quite an under performance to unwind if sterling becomes an investable place again. The market has wanted clarity a long time. The Broader Investor base has still been very reluctant to get involved in the u. K. And sterling more broadly until we get that clarity i think we, you know, in coming weeks and months, that clarity looks as though it might be on the horizon and the near future. So i think its a more positive outlook for the u. K. All right, ian, well leave it there on the positive outlook for the u. K. Hopefully we do get a deal signed the next couple weeks the head of fx heading at barclays lets turn back to markets again because i was just talking about the very stellar month we had across the stock market performances for the month of november starting with the u. S. Indices, this is what we had for the month of november for the dow. You can see we are shy of 30,000 we did breakthrough it last week, it was a milestone the president came out and about a 30second press conference, but there we are, just below 30,000 for now a very strong month for november up almost 13 on the month as for the s p, the picture is pretty much similar there as well the s p 500 also up about 11. 3 for the month of november, just shy of 3650. You can see on the board and the techheavy index, we spent a lot of time this year discussing the Strong Performance of the tech sector the nasdaq we have for the month of november, also up about 11. 9 . So actually for the month of november, traded in line with the other two major indices. For the most part of the year, beginning part of the year, the tech sector was the main per former it had more of a beta with the overall market move. Switching to europe, actually we never say this that often, but europe outperformed the u. S. Markets for the first time in a very, very long time, beginning with the u. K. Index. The ftse 100 actually up almost 15 for the month of november. So despite everything thats been going on with brexit, with another lockdown, and certainly a lot more lockdowns on the continent, it has been a good month for the u. K. Index this also despite the strength in the pound we were just talking about with ian a short while ago. So somewhat surprising there, but not so surprising if you look at the context of the ftse 100 and take into consideration that a big chunk of this basket is actually energy stocks, basic resources and the number of names that have International Exposure thats the ftse. Moving on to germany germany for the move of november, up almost 16 . Ill tell you one side about the german index it is the only one that is positive every other index i talked about, the ftse, is still negative for the year. The ibex in spain, this is the only one in positive territory and a stellar month, up 15 . Also a strong month, 22 there. We had a good performance for the banks actually a lot of the banking names in europe were up anything from 25 to 30 here were focused on b p, so a good month for those stocks in particular a lot of cyclical names did record a good recovery and, of course, many of those are actually situated in the qaq quarant. It tells you about Investor Sentiment appetite wanting to put money to work in riskier Industries Given the normalization prospect seen in 2021 so this does tell you a little about how investors are thinking about things certainly if they were running a short, they did want to get out of it with all the information flow we had in november. Thanks so much for the Market Update were going to squeeze in a short break now. When we come back, were going to be talking brexit coming up u. K. Officials expect significant updates in negotiations this week as the two parties race against the transition period closes, as the transition period closes at the end of the year. More on the state of talks after the break. [ whispering ] whats this . Oh, are we kicking karly out . We live with at t. It was a lapse in judgment. At t, we called this house meeting because you advertise gigspeed internet, but we cant sign up for that here. Yeah, but im just like warming up to those speeds. Youve lived here two years. The personal attacks arent helping, karly. Dont you have like a hot pilates class to get to or something . [ muffled scream ] stop living with at t. Xfinity can deliver gig to the most homes. Welcome back to street signs. Some Corporate News for you. Shares in jd sports are higher on the report the company is considering backing out of a proposed take over of debenhams. They were in exclusive talks j. D. Is reconsidering after the collapse of Arcadia Group which sells many fashion groups in Debenhams Stores med tropics is in advanced talks to be bought by siltronic. A deal could be agreed as soon as next month. Together the two companies would make up the worlds second largest manufacturer of silicon wafers from which computer chips are made the deal could be announced as early as today and would be the largest tieup this year, bringing together two of wall streets biggest data providers. Banking news, abn amro will consider paying out its 2019 dividends at the end of 2020, depending on the ecbs recommendation at that time. The dutch lender is targeting a return on equity of 18 . Speaking with clifford abrams, said even with a vaccine breakthrough, low Interest Rates will continue to weigh on the lender in the near term. The vaccine isnt when it gets rolled out, it should improve confidence and youll see increase in demand for loans, which will support our income line. I think we need to balance that against the very low Interest Rate environment over the last few years, in particular since the pandemic started, weve seen very low rates, and low rates arent good for banks so that will hold back earnings so youll see the balance of those two factors. Banks, as you know, are economically sensitive weve been hit on the downside and if theres a good recovery, we should benefit on the up side sticking with banking space, unicredits board has reportedly held informal talks over governance piling pressure on the c. E. O. Whose mandate comes up for renewal in the spring. Reuters report his bank to spinoff is facing resistance. Board members are divided whether the bank should buy struggling monte deposhe the stock is down 4 on the news switching to another bank, big news there, hsbc is reportedly considering a complete exit for Retail Banking in the u. S. According to the financial times. The british lender hopes the move will help boost its struggling north America Business the paper added that the banks Senior Management will present the plan to the board in the coming weeks hsbc itself declined to comment on the report. But speaking of british banking system, the other thing that people have been watching very closely are any headlines or any breakthrough, potential breakthrough comments on the brexit talks so far no breakthrough comments, but we did have some comments from the Irish Foreign minister. Let me just relay them to you. The Irish Foreign minister saying if there isnt an agreement on fishing, the whole thing could fall on the back of it he adds that if the u. K. Wants a deal, there is a deal to be done if the u. K. Wants to use fish as an excuse not to have a deal, then that could happen, too. And he adds that the british are attempting to separate fish from other issues we are not playing that game fish is even a more difficult issue than level playing fields. Wow. So really, really cementing that view that both lines have very hardline view when it comes to the fishing situation between the u. K. And e. U. , and what that could mean for a broader trade deal lets get out to sylvia who has been following the brexit discussions very, very closely sylvia, i semen, in the u. K. Test less than 1 were talking about a tiny portion of the economy here, and yet both sides seem to really be digging their heels in on this tonic. Could we end up in a situation where fisheries prevent the whole trade deal from coming together because both sides are just really not willing to compromise well, the reality is that that is a very important subject from a political perspective it doesnt have a lot of economic weight but it has a lot of political weight. The remarks from the Irish Foreign chief are very clear this morning, saying that this could all fall apart if theres no agreement when it comes to fisheries. But that in reality is not just the only sticking point. There is also differences when it comes to competition rules. And they have been stuck over the exact same issues, so its pretty much the start of the summer and the reality is they only have five weeks left until the end of the transition period and if they do want a deal, they need to come up with in the next few days, weeks, and get it approved in both the u. K. And european parliaments before the end of the year. It is very unclear at this stage whether thats actually going to happen what we do know is that the discussions, the negotiations are continuing this week here in london and actually, a source from the european side told me over the weekend that we are unlikely to see a breakthrough before a phone call between the Prime Minister Boris Johnson and the head of european commission. And, in fact, if we look at the entire Brexit Process so far, key milestones have always involved some sort of big political momentum behind it and, indeed, that could be the key that we need at this stage to unlock this process going forward. So lets see whether or not that will happen. At the moment, though, there are no phone calls or meetings scheduled as of yet. Lets see how the negotiations here in london this week will pan out. Thats certainly a lot of comments about fish. All right, sylvia, well leave it there thank you very much. Stay with us, were going to take a quick break tensions rise in the middle east after irans Top Nuclear Scientist is assassinated. More on that story when we come back welcome back to street signs. Im jovana these are your headlines they recoup early losses after opening in the reds. While u. S. Futures trade lower after the Trump Administration threatens to blacklist more chinese firms, sending shares with s partly cloudy mic and cnooc sharply lower. Shares in European Energy stocks sink ahead of todays opec plus meeting where ministers are expected to keep a lid on output, with Global Demand under continued pandemic pressure shares jump after the german chip maker confirm advance take over talks with taiwans global wafers, a Global Leader in the semiconductor space. And president elect joe biden announces an allfemale Communications Team aimed at bringing diverse perspectives to the white house. Welcome back to the show, everybody. Well, lets just take a look at how european markets are faring. We started off with a lack of direction, i would say for the most part, on the stoxx 600. We opened up briefly now slowly inching back into positive territory. Somewhat of a mixed picture for the european indices that capping a stellar week as we were recapping for the month of november, with many indices north of 14, 15 with the outperformers being the periphery index. A very strong november one of the big themes was a shift back into value, and that benefited certain parts of these indices and specifically there im talking about the sectors that got hit most lyft on back of the pandemic. So travel and leisure we saw a good month for that. A good for autos, a good month for the Banking Sector as well a mixed picture for the last day heading into december. As for the u. S. Futures, we had, again, a very strong month for those three indices. Very strong for the Small Cap Index. The russell index was up more than 21 for november, but the others were up anything between 11 and 13 as for today, the picture is somewhat muted we have s p cnooc opening 16 points lower, the dow 117 points lower. Remember the 30,000 mark is a level we broke through last wreak and couldnt quite stay above na lev above that level so today looks like well continue the down trends tech stocks open up weaker in an hours time as well. Thanks very much, jomana. Lets talk about perhaps the biggest geopolitical story of the weekend. Irans Supreme Leader has vowed to retaliate after the countrys Top Nuclear Scientist was assassinated near teheran on friday dan murphy joins us now with more on this story dan, gulf leaders are clearly anxious about how iran might respond. Help us understand the implications for the region of this killing and beyond the region absolutely, julianna. There are a number of implications what weve seen from arab leaders across the gulf is widespread condemnation of this killing of irans Top Nuclear Scientist, seen as a king pen inside the iran Nuclear Regime first in the gulf they are incredibly anxious about what this means in terms of an iranian response this is a similar theme that we saw following the death of the leader cast i leader Qassem Soleimani taken out by the United States weve seen action on the ground. We dont know how iran might respond. Leaders there said they will provide a calculated and decisive response, but whether or not that means we will see iran perhaps targeting facilities in israel, perhaps iran targeting a country in the gcc or maybe even targeting americana sets in the region, really remains to be seen. What we do know, though, is this certainly complicates the overall Foreign Policy agenda and Foreign Policy footprint of the United States, that in the region as well we do know that the president elect joe biden had said he would like to make the renegotiation of the Iran Nuclear Deal a key Foreign Policy plank for his administration so perhaps this decision by israel is indeed the case, to take out this top scientist in iran, would complicate the u. S. s ability to go forward with that renegotiation. In terms of the condemnation weve seen around the region and the world, the reaction weve seen from the u. A. E. In particular, they say given the Current Situation in the region, its important that all parties exercise maximum degree of selfrestraint to avoid dragging the region into new levels of instability that threaten peace. Weve also seen aman, jordan, turkey, the unite kingdom, the united nations, the European Union and others criticize this decision, which is certainly upended stability in the region. So in terms of what happened next, of course, theres still a lot of uncertainties here. But in terms of the asset market response, i think you can point to what were seeing in the oil market this has certainly helped to Push Oil Prices higher over the past four weeks. We now have oil tracking at its highest levels since march yes, some Downside Pressure in the session perhaps in response to opec uncertainty. The group is going to be meeting today and tomorrow to discuss the output cut extension that uncertainty filtering into the price here, but clearly oil also getting a boost off the back of these rising tensions and traders certainly trying to price any perhaps response that were going to see from iran moving forward and what that looks like is still very unknown at this point, guys. Well, you did me a favor there. I was just about to tell people whats been going on in oil markets. Youve done that for me. Thank you very much. For the recap of some of the geopolitical events we had over the weekend and also a little preview of what might happen today come that opec meeting, but to dans point, what we do have is the Energy Complex trading on the back foot today somewhat surprising you would expect with the news out of iran some more Political Risk premium would be priced into the sector. Not so much the case t. I. Down 1. 6 brent down 2 . For the month worth bearing in mind the Energy Complex as a whole is up about 30 . It has been an absolute stellar month for the oil markets. And that, of course, on behalf of renewed optimism about the economy and economic recovery going into 2021. This is the picture for some of the chip makers today as well following the cue from ti. Key chip makers. You can see many of them are based in the u. K. , bp down 2. 7 , shell down 2 . Also other oil majors in the continent trading weaker on the news as we head into this allimportant opec meeting, and just to recap as well what dan was saying, dan will be there covering the event but i think the main expectation is that they will not be ramping up production. And if you look at what the opecplus committee actually agreed earlier on in this year, if they follow that template, they would have had to increase production by 2 Million Barrels a day come january but now the news over the weekend seems to be indicating that they will not be going back to that january template so with that, lets bring in ron smith at oil and gas analyst great to have you with us. As i just mentioned, opec were scheduled to ramp up their productions by 2 Million Barrels a day. It seems unlike little they may do they. Do you agree looking that way now given what was reported over the weekend. We had a couple of the smaller countries who seemed to be dragging their feet, potentially if they remain absent on that, then apparently the production could be increased from januarys plan but if they encourage them, and i suspect they probably will, well probably see a one, two or threemonth delay in that increase but i think its got to be catching their attention, the counts over the last seven, eight weeks a significant increase in rate counts with oil low. Now with oil breaking up 48, 47, 49 briefly friday, that has to be a signal to the oil patch its time to drill in earnest again. You mention two things there. You have in addition to the output cut agreement, you have the prospect of further shale coming to the market and the prospect of the inventory overhang being cleared. How long do you think it will take for the inventory overhang that has been introduced this year to be cleared by the market if they do follow the schedule of ramping up production come spring next year lost connection unfortunately with ron, the oil and gas analyst from bcs Global Market analysts unfortunate because it is a very big couple of days for the oil market as he mentioned the oil is trading on the back foot going into the event on expectation that the glut and supply will persist for alittle bit longer but we are going to cut to a short commercial break stay with us well be right back. This years black friday does look a lot like cyber monday as online shares surge during the annual retail event. Well be right back. Woo you are busy. Working, parenting, problem solving. At new chapter vitamins weve been busy too. Innovating, sourcing organic ingredients, testing them and fermenting. Fermenting . Yeah like kombucha or yogurt. And we formulate everything so your body can really truly absorb the natural goodness. Thats what we do, so you can do you. New chapter wellness, well done. Welcome back street signs. Good news, we managed to reestablish a connection to ron smith, bcs global analyst. We were talking about the prospects of the further extension of the output cuts out of the opecplus members coming out of the meeting in the next couple of days and to that we were speaking to ron. Ron, i want to put back the question to you i asked before the break, and that is how long you think it will take for this inventory overhang in the system to be worked out, especially if opec starts to increase supply again . And weve got the prospect of shale producers coming back to the market as well well, there are a number of moving parts to that question. The trends weve seen the last two to three months, probably by march or so you would see u. S. Stocks of crude products more or less with demand, down to the coverage ratio one of the things we have to consider, what if opec starts putting more oil on the market 2 Million Barrels a day would make a difference and definitely slow that down the other question is whats going to happen with demand, with the second wave of covid19 so far it really hasnt shown up in the numbers and the only really good numbers we have on a weektoweek basis are those out of the u. S so far demand is kind of hanging in there pretty decently its a little harder to say about europe because we dont have quite the quality of numbers. So if we see opec put more oil back on the market and we see another at least temporary slow down from covid19, then it could be this summer before we see a full recovery. But see a full recovery, we will, and its part of the reason we think oil will be back well above 50 by mid year to the end of year next year. But for the next month or two, theres a good chance were going to see it go down before we see it go back up right i want to turn you to one aspect of the internal dynamics within opec, and that is of the u. A. E. The u. A. E. Had been dragging their feet as of late and saying they are unhappy with the quota thats been allotted to them out of the most recent Decision Making do you think this could perhaps be a barrier for future Decision Making out of the group, or is there a possibility for the u. A. E. To actually extract concessions and manage to eke out a little bit more of the quota when it comes to their overall production that is a actually a very good question. Before you threw in the opec country and russia and the others, opec is described as trying to hurt katz. With Oil Prices Going up, we could see break down in cooperation. Just in the interest of the various members of the groups start to difficult verge some of these smaller countries, you would think their level of production cuts arent that important to the overall cooperation. Yes, maybe they can extract some kind of concessions out of the larger players such as russia and saudi arabia but the internal dynamics, of course, are very difficult for us to judge standing out here. Meanwhile, i think some of the larger producers have to be keeping an eye on whats going on in the u. S. The rig counts have been going up for seven out of the last eight weeks and the climbs in rate counts started on oil back down around 40 which most people thought was too low for u. S. Shale producers to begin increasing drilling, yet they were doing it anyway now with oil trying to get up to 50, you would think that the price signal being sent in the field in west texas is, put the rigds back to work, which has to raise some questions about market share for russia and for saudi arabia ron, over the weekend were facing now rising tensions in the middle east on the back of the killing of irans Top Nuclear Scientist. How might this complicate the oil market narrative the one thing that keeps getting the question thats being raised by investors is what happens with the Biden Administration if and when sworn in, will they go back and try to resurrect the iran deal. If that were to happen, then presumably iran oil would come back onto the market and provide a downward significant downward pressure on oil prices at least for a while until it could be absorbed. To the extent that this complicates the ability to resurrect the iran deal, then it actually could end up having a positive effect on oil prices. The permutations, you could run through and find two or three reasons it could go up or down on this. All right, ron, were going to have to leave it there. Thank you so much for joining us today on street signs. Ron smith, oil and gas analyst from bcs a very important meeting coming up for opec. The senior communication rules and be filled by women president elect joe biden has selected an all female Communication Team tapping jennifer as press secretary, while Campaign Communications director kate betting field will retain her role in the white house. But biden has hairline fractures in his right foot after he injured himself while playing with his dog over the weekend. It was an interesting view to throw into the mix absolutely. I think this year as a whole has been a massive bonanza for any company thats involved in logistics given the massive shift people have made to ecommerce and not out of choice, but also out of necessity. You simply could not actually go to a bricks and Mortar Retail store even if you wanted to. Add to that, juliana, the numerous amounts of lockdowns well seen go on across the world particularly in europe where a lot of the nonessential stores were closed down for business but then the Ecommerce Stores were allowed to stay open. And remember we were talking about that in the context of france a few weeks ago amazon came out and said they were planning on pushing back their black friday events particularly in france because there had been some pushback from some of the more normal shops and Small Businesses saying, at least give us a chance to compete with amazon. If youre having this black friday event, we cant even compete, a, because were not open, and b, because we dont have the logistics and the Online Ecommerce ability that the monolith amazon seems to have and i think when all the dust settles and we will be going back to normal environment at some point in 2021, how much of that market share capture is going to stay with the amazons of the world and the businesses that have managed to rotate away from bricks and mortar a to online thats a big question for the Retail Industry going forward. It is and i think another big question related to that is who will actually win when it comes to online retail. Of course, amazon, the behemoth, is a winner for a number of reasons, not only because it sells through its own market place, but because it does enable Small Businesses to get online and put their Products Online and sell through the platform but given the difficulty in determining who is going to actually win out from a retail perspective, i think the proposition to invest in logistics, warehousing, delivery, is quite interesting because its agnostic to the actual content thats being and products that are actually being purchased. It takes away the uncertainty as to which businesses will actually win because everybody is going to need to use logistics and somehow get these products to consumers. So i would expect that to become a much bigger theme in 2021. Weve got a guest now to join us and talk about all of these trends thomas mckee, the director from gresman House Ventures well put that question to you we were discussing the Investment Case for Logistics Companies as a way for investors to play the ecommerce theme you have a view on companies that help businesses get online. Is the logic the same here, the fact that this is a relatively acnotice ti agnostic way to play the ecommerce boom . Good morning. Were seeing a massive shift the last nine months, a continuation of the trend thats been going and clearly for quite a long time now its accelerated massively i think the challenge as investors that we see in trying to play this shift is almost every business has benefited and some significantly so. And trying to unpick which businesses are sustainably benefited and which will revert to the means to some degree next year, and maybe performance wont be as strong or will tail off. We always look for different ways to play the strengths and obviously ecommerce isnt going anywhere but will continue growing. If we can invest in businesses that help shift to ecommerce, logistics, warehousing, marketing services, platforms themselves, i think it goes to the benefit massively on a continuing basis and wont fall back next year and as consumers inevitably next year or the year after, who knows, eventually when consumers start going back to shops and other houses again when it comes to Small Businesses, what do you think of the Business Model of selling through a platform like amazon versus selling direct to consumer its another route to market, another channel businesses can play weve seen a number of businesses do this extremely successfully the number of businesses that buy amazon selling businesses out there, this is the in the u. S. Definitely that there is an opportunity there. Id say its a different skill set, a different way to go to market, say, as a business you have the choice really to sell direct through your website, do you sell through wholesalers or do you try and talk to these other channels not every business is going to have the skill set to do everything thomas, well have to leave it there were running short on time. Thomas, thank you very much for joining us thomas makey director from gresham House Ventures talking about the retail trends that were seeing but that is it for street signs. Thank you for tuning in. Im jomana versace and juliana was working from home. Its down to the wire, the teams been working around the clock. Weve had to rethink our whole approach. Were going to give togetherness. Logistically, its been a nightmare. Im not sure its going to work. Itll work. I didnt know you were listening. China as the white house looks to blacklist two Major Chinese conglomerat conglomerates. Days away from the first covid19 vaccine injections as hospitalizations continue their climb. Back above 18,000. We saw action in the