Good points on valuation. Many are in this sector for the dividends and that alone. This will be a tough sector, especially if oil prices rise.

The decrease is really at the cost to China due not so much to the US buying less but the simple fact manufacturing is fleeing to SE ASia. This would have happened with or without the tariffs. Both countries are not better off with a trade war and I think most everyone at the table knows it. Tariff China mode = the Federal Reserve raising rates to fight artificial inflation and/or further slowdown in the US economy. Stagflation can end any cycle no matter how strong the economy is.

The main concern should be on the banks financing zombie debt. It is widely known a lot of small oil gambles are losses and are not able to ever pay up or be profitable. Yet big banks keep financing them because this is the only way they can keep paying their debt. Everyone know the outcome of such behavior yet it is still done. As for other corporate debt that can be financed off of revenue streams, they seem ok.

We will see 2022 when the debt payments spike how corporate debt does as a whole. I don't see an eminent trigger besides a full on trade war and financial unwinding. Trump's leverage at the table for trade wars has diminished as everyone should have known as his terms drag on. A deal is better than no deal and further tariffs will endanger the economy and ruin his re-election hopes. I hope better minds prevail for the US and the global economy. As we can see tariffs have done little from stopping the trade deficit from China besides taxing the US consumer to the ground.

A lot of money has been bet against oil recently on China trade woes, however, they are missing the point that oil demand across the globe is increasing and that the Middle East is becoming more unstable not less. Oil companies that benefit from rising and falling oil prices should trade at a premium not a discount.

Oil is becoming increasingly important despite the large reserves which is mitigated by the even larger growth in demand. This summer will be a hot one for oil companies. If you are worried that this will spur oversupply and it will all come down after summer driving season Exxon is a safe play. It makes money even if oil prices drop. It made money in the downturn and even bought back stock.

I expect a mild week with some downside. We will see what comes next to shake up the market.

Thanks for the sectoral graphics. It is amazing people aren't talking about healthcare's horrible performance more which is worse than manufacturing and commodities which gets a lot of coverage.

The Apple Qualcomm deal is a marriage of convenience more than anything long term or stable. They both didn't want the risk of a drawn out court battle and having to morph their business around each other at great cost. That said, they both will be looking for alternatives and they both are not fair players. Expect war to emerge again once one finds out the other doesn't need them.

The Federal Reserve is much better off getting QE off its balance sheet than raising rates. I agree with the author that it is getting hard for them to raise rates now. They should keep reversing QE while they can. The sad fact is the next downturn will spark cries for more QE again. It's a genie in a bottle that can't be put back once opened.

They can sell off pieces of themselves if they get in big enough trouble. That would be the sign. There are way too many variables to declare that it will or won't survive. The chief issue is whether or not they can raise more capital or equity in the near term.