Oil’s Spillover Effect On Stocks And Some Potential Investment Plays

Oil’s Spillover Effect On Stocks And Some Potential Investment Plays

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Noted commodities expert Paul Shankey, of Wolfe Research was interviewed on CNBC’s Smart Money last evening about the outlook for oil, what he sees in the mergers and acquisition’s sector; and, some potential stock investment plays for investors/traders who want to take some chances on companies during oil’s freefall. Mr. Shankey noted that there are bargains to be had in this sector — as investors should focus on companies that can weather this storm in collapsing prices; companies with solid balance sheets, well managed, and poised to take advantage of a very unsettling marketplace.

Regarding oil’s spillover effects, Reuters News Service reduced its 4th quarter/2014 earnings outlook for the S and P, down from its previous estimate of +11.4 percent; to now, just +4 percent — as oil’s collapse weighs on the index. Oil companies/revenue make up 30 percent of the S and P 500 Index. Oil is falling again this morning, with Brent Crude falling $1.73, or -3.65 percent to $45.70; while West Texas Intermediate is trading lower by $1.63, or -3.54 percent, to $44.44.

Shankey’s Top Oil Plays — In No Particular Order Were:

EOG, Hess, Conoco Philips. and Devon Energy were all highlighted as top oil picks in 2015 by Wolfe Securities Paul Shankey. If you decided to take a bite — make sure you do your own due diligence. V/R, RCP

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