Q1 should have been a strong quarter for global petchem demand: • Buyers had to restock in the New Year, as CFOs had cut working capital for year-end reasons • In the West, Easter is delayed until April, and the USA has benefited from the warmest winter in 50 years • China’s holidays took place […]
Tag Archives | S&P 500
“Two roads diverged in a yellow wood,And sorry I could not travel both“ The opening of Robert Frost’s famous poem ‘The road not taken’ aptly sums up today’s market situation:•Financial markets continue to be supported by the Fed’s Operation Twist•Petchem markets are slowing in reaction to weaker consumer spendingBoth of them cannot be right. Either […]
As regular readers know, the blog regards benzene as an excellent leading indicator for petchem markets and the global economy. Its track record since the start of the crisis in 2008 has continued to be strong. The reason is probably two-fold: • It is one of the oldest, and widely used, chemicals. In many ways […]
The March IeC Boom/Gloom Index confirms the blog’s sense that markets are sitting on a fence, waiting for something to happen. As the chart shows (blue column), it has risen back to 4.1, just at the point which divides strong from weak markets. Similarly the US S&P 500 Index (red line) is stuck at 1369, […]
The Wall Street Journal carried an interesting opinion piece on Friday, assessing current market conditions from the viewpoint of the film character, Forrest Gump. Gump’s key insight is that “Stupid is as stupid does”. Thus the Journal noted: “Oil staged its last price surge along with other commodity prices when the Fed revved up its […]
The US S&P 500 is the most important stock index in the world. It contains 500 different major companies, in a wide variety of industries, and has been calculated since 1957. There has never been a day when all 500 stocks moved in the same direction. This is not surprising, as good news for one […]
This time last year, the petchem industry stood on the edge of an unseen precipice. Life seemed good. Prices were racing ahead and demand appeared buoyant. But in reality the buyers were only buying forward to protect margins, whilst end-user demand was slowing fast. This year, the blog fears, we may be about to take […]
Over the past 18 months, the main investment analysts have argued that high oil prices would have no impact on the global economy. Now, new forecasts suggest their optimism has been misplaced. The chart above gives the International Energy Agency’s latest forecast of likely oil demand growth this year: • It has been reduced by […]
Dow Chemical is usually optimistic. 6 months ago, for example, it reported that “our transformed portfolio, underpinned by our cost-advantaged and flexible operations, is now performing at a new level.” Last week, however, Dow reported that Q4 operating rates were down from 81% in 2010 to 72%, and warned it faced “headwinds” in all segments […]
The blog, like many readers, has become rather fond of the IeC Boom/Gloom Index since it was launched in June 2009. The aim to was to track market sentiment, and it continues to perform this task. It also throws up intriguing parallels, and sometimes disconnects, with financial markets. As the chart shows, this month is […]
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Paul Hodges is Chairman of International eChem, trusted commercial advisers to the global chemical industry.
The aim of this blog is to share ideas about the influences that may shape the chemical industry over the next 12 – 18 months. It will try to look behind today’s headlines, to understand what may happen next in important issues such oil prices, economic growth and the environment. We may also have some fun, investigating a few of the more offbeat events that take place from time to time. Please do join me and share your thoughts.
Between us, we will hopefully develop useful insights into the key factors that will drive the industry's future performance.