Flux News – Details, episodes & analysis

China saw its weakest manufacturing PMI data since February this week, with a fourth consecutive contraction. In the US, PCE inflation data came in below expectations, while Q2 GDP and consumer confidence came in higher. The Q2 GDP data is very backward looking, and this week’s U.S. PMIs and employment data are of critical importance - particularly with the next Federal Reserve central bank meeting on 18th September.

The Fed seems dovish, key data shows manufacturing and employment slumping, and private sector job creation has plunged to six-year lows while government jobs surge to all-time highs. Housing data also looks poor in both the US and China.

In equities, there's been a sharp increase in net short positions in the S&P 500, and Indian stocks are up for a record 13th straight day. UK shop prices are now in deflation, and German GDP has officially barely risen in six years. Hedge funds are bullish on gold, and coffee is reaching an all-time high. The team also discusses Central Bank OIS pricing, USDJPY, Brent, Nvidia, and more.

The key data releases this week are:

Tuesday:
-U.S. ISM mfg. PMI

Wednesday:
-JOLTS job openings
-Fed Beige book
-BOC rate decision

Thursday:
-Jobless claims
-ADP employment
-U.S. ISM services PMI

Friday:
-U.S. jobs report

In the latest episode of The Officials, special guest Michal Meidan, Director, China Energy Programme at Oxford Institute for Energy Studies joins Jorge Montepeque, Harry Tchilinguirian, Vincent Wu and new Official Edward Hayden-Briffett to discuss China’s impact on the financial energy market and demand.

The picture isn’t pretty for China at the moment. Sentiment is weak and it’s been a difficult year for the economy, with real estate downturn and expenditure down as well. The east is also seeing fundamental changes to the structural economy such as the growth of EV’s and robots. The Officials discuss where China’s supply and demand for energy products could go next.

We hope you enjoy our seventh episode of The Officials, a new show from the team behind Onyx’s Benchmark Publication and helmed by Jorge Montepeque the architect of benchmarks and services that shape our world today.

To read the latest report by The Officials, click here; https://www.onyxhub.co/news/all/the-officials-asia-29-08-24/

Welcome to the pilot episode of Oil Insights, hosted by Harry Tchilinguirian, Head of Research at Onyx, alongside co-hosts Martha Dowding and Vincent Wu, Research Associates at Onyx.

The oil market has been on a wild ride in the past week and change, selling off violently amidst unwinds in other classes, notably FX and the Yen carry trade. The risk-off mood across risky assets did, however, stabilise, with oil back above $80/bbl. The VIX index, the volatility indicator of the S&P 500, a measure of nervousness, has retraced more than half of its spike of 5 August, indicating some of the jitters of last week have subsided, even as more position unwinds are expected, albeit smaller in amount now.

Onyx's CTA net positioning model indicates that short positions have potentially ‘bottomed out,’ signalling a return to an uptrend. CFTC data highlights that short positions remain exceedingly high in Brent futures, with shorts increasing at the fastest pace since the post-OPEC meeting. The long-to-short ratio in Brent is currently at 1.09:1.00, placing it in the 1st percentile—a level not seen since March 2020.

Additionally, we’re observing significant refiner selling across September, October, and the September/October DFL period, with fund selling in August/September DFL. In the CFD market, our data suggests that last week’s buying flows have transitioned into selling. While September’s structure has been well supported, the rally may have peaked at these levels, leading to profit-taking flows.

Rather than delving into a single story for our Googling Oil segment, the research team focuses on a prevailing theme in the oil market: the growing mention of Iran in numerous articles, driven by resurgent geopolitical tensions. 

Over the weekend, Iran reiterated its intention to retaliate against Israel amidst a buildup of US military assets in the Middle East, including F22 fighter jets and a submarine equipped with guided missiles. As Martha explains, the last time we witnessed a similar scenario was in mid-April. During that period, we observed a range-bound price action lift leading up to an attack, a two-week delay and then a relaxing in crude futures.

This week's most interesting product is gasoline, with the summer driving season entering its final weeks. The weekly US data may underestimate demand, but the money managers are extremely short. The market seems vulnerably short, but will there be a spark to drive it higher?

We’d love to hear from you! If you’d like to get involved with our podcast, please leave a comment and subscribe to our YouTube channel, the World of Oil Derivatives.

 Chapters for this episode are: 
0:00 Introduction
0:54 This week in the oil market
3:29 Brent Futures
8:26 "Googling oil:" world oil news 
20:31 Product of the week: gasoline
27:27 Concluding remarks

In this episode the Onyx Research team react to the outcome of the latest OPEC+ meeting and the Saudi output pledge. 

Ehsan Massah
https://www.linkedin.com/in/oilanalyst/

Vincent Wu:
https://www.linkedin.com/in/vincent-wu-099816125/

Martha Dowding
https://www.linkedin.com/in/martha-dowding-ab84801a6/

In this episode Greg Newman and Vincent Wu discuss the market dynamics surrounding another potenital OPEC+ cut. Plus - insight into the genesis and growth of #WuFridays 

Greg Newman
https://www.linkedin.com/in/oilderivatives/

Vincent Wu
https://www.linkedin.com/in/vincent-wu-099816125/

Greg Newman speaks to the Onyx Data team. Discover how the integration of data-driven strategies is revolutionising decision-making processes, enhancing operational efficiency, and fuelling innovation within the oil swaps landscape. 

Greg Newman
https://www.linkedin.com/in/oilderivatives/ 

Adam Butler 
https://www.linkedin.com/in/adam-butler-57629966/ 

Tom Dyson
https://www.linkedin.com/in/tom-dyson-5108aa12b/ 

In this episode Greg Newman and the Onyx Research team discuss the resurgence in the markets. Plus - will OPEC cut again? 

Greg Newman
https://www.linkedin.com/in/oilderivatives/

Ehsan Massah
https://www.linkedin.com/in/oilanalyst/

Audrey Byrne:
https://www.linkedin.com/in/audrey-byrne-a32009183/

On the agenda this week is the evolution of trading culture. Plus - how did we build our research team here at Onyx? And - how much recognition are financial flows getting in the derivatives market today?

Greg Newman
https://www.linkedin.com/in/oilderivatives/

Vincent Wu:
https://www.linkedin.com/in/vincent-wu-099816125/

Audrey Byrne:
https://www.linkedin.com/in/audrey-byrne-a32009183/

This week; the team discusses BP's profits hitting $5B whilst shares slip on slowing buybacks. Plus - how much do we know about diesel and gasoline being smuggling out of Iran? And - is trading at all like gambling? 

Greg Newman
https://www.linkedin.com/in/oilderivatives/

Ehsan Massah
https://www.linkedin.com/in/oilanalyst/

Vincent Wu:
https://www.linkedin.com/in/vincent-wu-099816125/

Audrey Byrne:
https://www.linkedin.com/in/audrey-byrne-a32009183/

In this episode Greg Newman and the Onyx Research team discuss Chinese fuel demand, weak refinery margins, and the natural gas market. 

Greg Newman
https://www.linkedin.com/in/oilderivatives/

Ehsan Massah
https://www.linkedin.com/in/oilanalyst/

Vincent Wu:
https://www.linkedin.com/in/vincent-wu-099816125/

Audrey Byrne:
https://www.linkedin.com/in/audrey-byrne-a32009183/