Weekly Market Outlook

Oil held gains above $53 a barrel as output cuts from OPEC and other producing nations are seen clearing a global inventory glut.

Futures were little changed in New York after rising 1.6 percent the previous two sessions. The global market will shift into deficit during the first half of this year and U.S. crude stockpiles will shrink amid a decline in imports as the OPEC-led curbs take effect, Goldman Sachs Group Inc. said this week. OPEC achieved the best compliance rate in its history at the outset of an accord to clear a surplus, the International Energy Agency said Friday.

Oil holding pattern

Oil has fluctuated above $50 a barrel since a deal to trim output between the Organization of Petroleum Exporting Countries and 11 other nations took effect on Jan. 1. U.S. producers are taking advantage of higher prices by increasing drilling activity and boosting daily output to the highest level since April. OPEC is due to release its monthly report on Monday.

“If there is reasonable compliance to the cuts, there will probably be a strong price reaction before the headwinds come back into play, which is rising U.S. production and stockpiles,” said David Lennox, a resources analyst at Fat Prophets in Sydney. “Oil may have a sustained climb into the high $50s.”

West Texas Intermediate for March delivery was at $52.97 a barrel on the New York Mercantile Exchange, down 3 cents, at 9:01 a.m. in London. Total volume traded was about 32 percent below the 100-day average. The contract gained 66 cents to $53 on Thursday. Prices are down 1.5 percent this week.

Record Compliance

Brent for April settlement was 8 cents higher at $55.71 a barrel on the London-based ICE Futures Europe exchange. The contract gained 51 cents to $55.63 on Thursday. Prices are down 1.9 percent this week. The global benchmark crude traded at a premium of $2.25 to WTI.

OPEC members implemented 90 percent of pledged cuts in January, the first month of its agreement, as Saudi Arabia reduced production by even more than it had committed, the IEA said in its monthly report. Resilient oil demand is aiding the group’s bid to re-balance markets, growing more than expected last year and is poised to do so again in 2017, according to the agency.

Oil-market news:

  • China’s crude imports in January slipped from a record as refiners eased buying before the Lunar New Year break, when industrial activity tends to slow during the country’s most-important holiday.
  • Saudi Arabian Oil Co. will sell full volumes of contractual supply for March to Asian refiners, according to people with knowledge of the matter who asked not to be identified because the information is private.
  • Occidental Petroleum Corp. may double its U.S. Permian Basin oil production in the next four years after record-low costs to find and pump crude helped make it the company’s main profit driver.

Weekly Market Outlook

When it comes to Asia’s high-risk bond market, investors are unfazed by the threat of trade conflicts and currency wars.

Asian high-yield issuers are capitalizing on this exuberance, churning out almost $6 billion of junk-rated debt so far this year, the most since the same period in 2013, according to data compiled by Bloomberg.

It’s not just a pick-up in the amount of primary supply. The issuers have broadened, with South and Southeast Asian players joining the pipeline in the last few weeks.

“There is a sense of uncertainty entering developed markets with new political ideals emerging,” Chuanyi Zhou, credit analyst at Singapore-based Lucror Analytics, said in an interview. “Contrast this to positive outlooks for Indonesia driven in part by a reduction in its vulnerability to external events, while the attraction of Indian names is the ability to diversify into a country that maintains healthy growth rates.”

Late last month, Asia’s green financing received a boost from India-based Jain Irrigation Systems’ first foray into the offshore debt market. Another Indian company, ReNew Power, followed suit. It successfully wrapped up the sale of its 144A/Reg S outing this week.

Also this week, Jakarta-based Bukit Makmur Mandiri Utama has amassed more than $2.2 billion of orders for its $350 million notes, and Pakuwon Jati’s dollar-denominated offering was multiple-times subscribed too.

Asian high yield dollar bond spreads over U.S. Treasuries fell to a 3 1/2-year low of 434.9 on Jan. 26, according to JPMorgan Indices. It was at 442.6 Thursday.

Deutsche Bank AG’s Asia head of debt origination, Haitham Ghattas, expects the trend to continue because of “investors’ desire to diversify Asian high-yield portfolios and the need to invest ongoing inflows.”

“With U.S. Treasuries range-bound and subdued market volatility, current market conditions present an opportune time for regional high yield borrowers to access the debt capital markets,” he said in an interview.


Financial Planning

There are so many people today with their sights set on big financial goals for their future. More specifically, there are many individuals today who are looking for ways to become a millionaire. In fact, there is no end to the different types of approaches and suggestions out there that offer “theories” on becoming a millionaire. While theories are great, many aspiring millionaires need real action steps in order to find the success they have been looking for. While it isn’t always an easy road to reach this type of financial success, there are some very tangible action steps that individuals can take in order to become a millionaire.

1. Invest in yourself.

The old phrase “knowledge is power” is not one to be ignored. If you want to be a millionaire, then you need to really be able to invest in yourself and to educate yourself. How do you start and what do you educate yourself with? Start by writing down all of your hobbies and favorite things to do. From there, choose two or three that you want to dedicate yourself towards mastering within the next five to 10 years. The mastery of any one given subject is the key to making millions down the road.

Make sure you don’t just pick one hobby because you may not like it as much in the future as you do now, so you need to have a couple of safety options as well. As you start to educate yourself, you can then refine your skills based on what subjects you enjoy and what you have the most talent in. Really finding your niche and learning to master it is the key to getting started, and it is a real action step that you can actually take.

2. Learning how to budget and manage expenses.

If you have this skill early on, you can really go a long way on your road to becoming a millionaire. It isn’t a hard task to learn if you are willing to put some time into really honing your management skills. Read up on budget management or take an online course. From there, start tracking all of your spending. It doesn’t matter how much you are making, it matters that you are able to control what you are spending and what you are saving. There are so many people today, even celebrities and famous athletes that make hundreds of millions of dollars and they eventually go broke, it is because they don’t know how to budget. Learn this skill and you are setting yourself up for success.

3. Commit to learning about the business world.

You need to take the time to commit to learning about the business world and about investment opportunities. If you have a base knowledge of these key factors, you can really go far on your quest to become a millionaire. This means a real overall knowledge of real estate, mutual funds and stocks. Take the time to read up on guides likes these from Entrepreneur and ones like this one I created. While it may not be the most interesting thing in the world to learn about, it is important that you take your time to really immerse yourself in this world… think of it as your second job.

Once you have mastered this and learn how to invest conservatively and responsibility, you can have your savings work for you, while you sit back and do nothing. Passive income is really fantastic, and while it may not seem like a lot in the beginning, it can really add up over time.

If you really want to become a millionaire and want to be able to have the financial freedom you have always wanted, then you need to be willing to take action and make strong moves that will actually lead you towards the financial success you have always wanted.