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OPEC Jedi mind trick waves dirt to the moon

Thursday 29 September 2016

There is no OPEC deal but the Jedi wave of its hand is enough and off we go. The BHP re-rating mooted a month or so ago has blasted through the top of its bullish ascending triangle pattern by 4%, RIO has broken out as well up 2.8% and FMG is up 3% as Dalian adds another 2% to overnight gains:

It can be argued that oil boosts dirt prices owing to input costs for miners but only if they have the pricing power to pass them on! Otherwise it’s a margin crush, BHP being the exception given it’s an oil producer.

Big Gas is in ecstasy with WPL 6.3%, OSH 7.3%, ORG 8.6% and STO 7.9%:

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About the author

David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific's leading geo-politics and economics portal. He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.