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Garnry: Why US stocks are full of energy

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We’ve seen record highs on US stock markets recently, Peter Garnry, Saxo Bank's Head of Equity Strategy, picks out which firms will be the movers and shakers this week. Peter highlights the US energy sector, with the WTI price falling by around ten percent from the peak, but with fundamental demand rising, Peter argues that firms like EOG Resources, Marathon Petroleum and Pioneer Natural Resources look set to benefit from current trading conditions.  

Peter comments on buy-back schemes, a real trend with schemes worth 671 billion USD announced last year, are these good for investors or do they just make senior executives richer? Peter believes the schemes underline a lack of business confidence, as firms prefer to invest in their own shares rather than expansion projects. Definitely a trend to watch this year as schemes are already worth around 300 Billion USD so far in 2014.    

Now, there’s a growing consensus that we should expect a correction in equity markets. Is it time to take a defensive position?  Peter stands firm in his view that US stocks still have momentum, and will see nominal gains thanks to growth and inflation.