To The Moon

Eons ago, June had been a weak month, second only to September.

Good news is the bearish effect has dissipated over time.

Using S&P 500 as a benchmark - for the last 50 years, the month of June has been up 30 times.

Now for an even better news.

The number would be even “higher” if S&P has been strong, going into June, like now.

Isn’t this a wonderful piece of news to know?

Hope that my attempt at S&P 500 “technical drawing” (see above) is able to support the good news mentioned above (if my life depends on it - LOL!).

The deal to raise US debt ceiling has been passed by Congress (Hse Rep & Senate) and wrapped up by President Biden already over the weekend.

The act alone (hopefully) could boost some of the unloved corners of the US stock market.

This would be:

1. Energy.

2. Industrials.

3. Financial.

Keeping the post concise, I will focus on item #1 - Energy only.

Energy.

• On Tue, 30 May price of oil fell below US$70.

• The aggravating factors were (a) US debt ceiling crisis and (b) Russia flooding market with cheap oil.

• Item #a has been resolved. **Latest: On a quiet Sat, 3 June - President Biden has signed the legislation at the Resolute Desk.

• Item #b on the other hand, might come to a faceoff (??) when OPEC+ members convene in Vienna.

• Quite certain that a deal would be brokered between Saudi & Russia because they have a common denominator - “the US”.

• Based on “leaks”, the Saudi is looking to reduce output by 3 Millions bpd; an additional 2 Millions bpd from last Oct 2022 reduction endeavour; that hasn’t been successful with Russia going rogue.

Should Russia toll the line this time, the probability of an oil rebound is high.

Imagine oil price drifting back to $88 and more !

If there is an ever a good time to include Energy stock in your portfolio; seize the moment after doing your due diligence ok!

Looking to bona fide investors “for signs, directions” and even affirmation personally, forms part of my strategy checklist.

An example would be veterans at $Berkshire Hathaway(BRK.B)$ - Mr Warren Buffet & Mr Charlie Munger.

BRK - Multiple purchases of OXY (2019 to 2023)

• The above diagram spans 2019 to 2023; focusing on MNC’s purchases & sale of Energy stock - $Occidental(OXY)$

• Starting from 2019, Mr Buffet has made 7 purchases and finalize 1 sale within 5 years.

• The most recent purchase was recently in May 2023.

• Mr Buffet is clearly bullish on long-term outlook for the Energy sector and a firm believer that hydrocarbon energy prices have a fairly bright long-term future.

In addition, we haven’t forgotten the “watch-out threat” that the Saudi has warned oil-speculators recently (see below).

Taking it at face value, it’s as if the Saudis have something up their sleeves.

All shall be revealed after the OPEC+ meeting on Sun, 4 Jun 2023 and not a minute too soon!

• Do you think OPEC+ members will further reduce output to “force” a price hike?

• Do you think Saudi’s Energy minister Prince Abdulaziz bin Salman really has an effective approach to curb speculators, as exclaimed?

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