Maleeha Bengali is CEO of MB Commodities Capital, based in London.
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Friday is the April expiration for S&P 500 index options -- and that can explain more or less why the market has been so tightly pinned.
QE does not produce growth, it just delays the inevitable problem and kicks the can further down the road. Meantime, we have a curve ball (the Fed) that keeps throwing trillions at the market, buying riskier assets each time.
Are you willing to pay a 20x-plus multiple for European oil majors that do not and cannot grow?
Buying the market here is about pricing the economic recovery and the end of financial damage being priced into these stocks.
This is a big selling opportunity in the European oil majors.
The excess inventory in oil will dry up, and the market will be forever changed. It is harsh in the short term, but could ultimately be beneficial.
With the Fed announcing bazooka liquidity measures as selling took a breather, it allowed the market to rally back to the next level of resistance of around 2600. But now what?
We will enter a hyper inflationary world at some point. In that environment bonds and equities will move together in the same direction, and the 60-40 model will not work anymore.