A roundup of what The Globe and Mail's market strategist Scott Barlow is reading this morning on the Web
Blackstone LP has signalled a market peak in global real estate assets,
"Investors should 'calibrate' their expectations," Chris Heady, Asia Pacific chairman and head of Asian real estate, told a conference in Singapore on Tuesday. 'They're probably going to be lower over the next five years' … Singapore's sovereign fund GIC Pte … said that elevated prices were constraining its investment as it sold assets that had gained in value … Lee Kok Sun, GIC's managing director and chief investment officer for real estate, told the Singapore forum that about 7 percent of GIC's portfolio had been in real estate, less than the targeted allocation of 9 percent to 13 percent.
"As a "disciplined investor," GIC sold some assets that increased in value. But selling properties while trying to raise the allocation was like running 'faster and faster' on a treadmill"
"Blackstone Sees End of Property's 'Great Run' as Returns Fade" – Bloomberg
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Global oil markets are returning to balance (from surplus) faster than expected according to the International Energy Agency,
"In the first quarter of 2017, 'we might not have seen a resounding return to deficits but this report confirms our recent message that rebalancing is essentially here and, in the short term at least, is accelerating' … Global oil supply fell by 140,000 bpd in April to 96.17 million bpd, led by declines in nations outside the Organization of the Petroleum Exporting Countries, such as Canada. But with strong production increases in the United States, Brazil and Kazakhstan, the IEA said non-OPEC output would grow by 600,000 bpd this year."
"Global oil market rebalancing speeds up, inventories lag: IEA" – Reuters
"OPEC Prolonging Cut Would Achieve Mission to Clear Oil Glut" – Bloomberg
"Glencore Says Electric Car Boom Is Coming Faster Than Expected" – Bloomberg
"@JavierBlas2 Replying to @JavierBlas2 Global oil demand growth y-on--y in Q1 2017 was the weakest in 2½ years, with US gasoline demand ( 1-in-10 oil barrels globally) contracting " – Twitter
"'Much work remains' to drain excess oil inventories – IEA" – Financial Times
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Domestic investors in commodity stocks should keep a careful eye on Chinese data as the world's second-largest economy, and the primary source of demand for almost every raw material, tightens credit conditions and slows infrastructure investment,
"That tightening — however long it lasts — is going to start reversing the credit-fuelled surge in infrastructure and real estate investment that boosted the old economy and GDP growth while also building up imbalances which would eventually have to be worked out. The losers in this should be pretty obvious. They're the ones that gained."
"When stimulus fades, a recurring Chinese story" – Keohane, FT Alphaville (free with registration)
"@vsualst An argument for a potential rebound in CAD and AUD" – (chart) Twitter
"China's Growth Dividend for World Economy Shows Signs of Fading" – Bloomberg
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Credit Suisse predicts a very difficult road ahead for retail stocks,
"'Our analysis is most positive for Home Improvement, Leisure-related categories (e.g., RV's, boats), and Staple categories (Healthcare, Household Supplies, Food at Home) based on expected growth in the young adult and 65+ age cohorts, while less positive for Apparel/Footwear, General Sporting Goods, Home Furnishings, Casual Dining, based on a shrinking middle-age group,' the analysts wrote."
"CREDIT SUISSE: Huge demographic changes in the US could hit these 14 retail stocks" – Business Insider
"@CBinsights The rise of Amazon and the decline of pretty much everyone else in one chart: cbi.vc/2pCrscK " – (chart) Twitter
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Tweet of the day ('top tail risk' is managerspeak for 'thing that keeps us awake at night') : "@Callum_Thomas Cool chart from the latest BAML FMS - the evolution of perceived top tail risk (forget Europe, it's back to worrying about China!) " – (chart) Twitter
Diversion: "How Does a 110-Million-Year-Old Dinosaur Still Have Its Skin?" – Gizmodo
Scott Barlow