Why are oil and commodity producers climbing faster than global stock market indices?

S

Steve Ladd

I think of the broad indices as leaders and the commodity producers (COPX etc.) as followers. Granted, the producers had been driven into the ground. But surely the producers can't lead for very long.
 
Bottom in Baker Hughes Oil Rig Count last August was the tell.

And as I notated on right hand side of attached chart you got till March of next year to "make hay", give or take a similar 6 month lag time. Absolutely, without a doubt .... maybe. ;)
BHORC.png
 
Steve Ladd said:
I think of the broad indices as leaders and the commodity producers (COPX etc.) as followers. Granted, the producers had been driven into the ground. But surely the producers can't lead for very long.
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This is pretty standard cyclical action in an economic recovery. Buying commodity related stocks when they are disliked often leads to huge returns; as much as top IT performers in many cases just not as high profile in nature. I based a lot of my trading in March 2020 forward on what I experienced in 2009-2010 and the mistakes I made in that time period ( mostly missed opportunities and selling winners way too early in things like copper stocks ).
 
They say that commodities are the place to be during hyper-inflation.

Personally I think unemployment is too high for hyper-inflation to occur but I could be wrong and often am.
 
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