Live Markets: Early-day exposure to carbon capture & storage in sight

Aker Carbon Capture ASA

25/10/2021 14:49

* U.S. equity index futures rise
    * Euro STOXX 600 index flat
    * Dollar edges up; gold, oil, bitcoin gain
    * U.S. 10-Year Treasury yield ~1.67%
    * 

    Oct 25 - Welcome to the home for real-time coverage of
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    EARLY-DAY EXPOSURE TO CARBON CAPTURE & STORAGE CHAIN IN
SIGHT (0947 EDT/1347 GMT)
    One way to cut greenhouse gas emissions is capturing carbon
dioxide directly from industrial processes and then storing it
underground in depleted oil and natural gas reservoirs.
    The technology to do so has been around for decades but now
could start gaining traction, though it's still early days and
much will depend on government policies and carbon prices.
    Analysts at RBC say the Carbon Capture & Storage (CCS)
technology will be featured at the upcoming COP26 summit in
Glasgow and argue that CCS "could play a pivotal role in the CO2
equation for energy companies and other industrial emitters."
    "In the absence of revenue drivers involving the secondary
use of captured CO2, CCS on its own is a capital intensive
investment with fragile returns that depend almost entirely on
carbon prices and government policies," says RBC.
    "Thus, evolution of the private-public partnership model is
essential for CCS adoption to blossom from a small base today in
the coming decades," they say.
    That being said, they single out a few names in their global
coverage universe with exposure to CCS: Advantage Energy
 AAV.TO , Aker Carbon Capture  ACCC.OL , California Resources
 CRC.N , Canadian Natural Resources  CNQ.TO , Drax  DRX.L ,
Whitecap Resources  WCP.TO , Schlumberger  SLB.N  and Baker
Hughes  BKR.N .
    
    (Danilo Masoni)
    *****
    
    FINANCIALS POISED TO OUTPERFORM AS BIG TECH REPORTS (0915
EDT/1315 GMT)
    The bulk of earnings season occurs the next two weeks, with
Facebook on Monday the first of the Big Tech companies to report
results, but financials  .SPSY  may take the spotlight as they
have beaten earnings expectations by twice that of other
companies so far.
    Earnings are projected to grow 34.9% for the overall market,
with financials surpassing expectations by 20.3% while the rest
of the market is delivering an aggregate beat of 10.0%,
according to Credit Suisse research.
    The big five tech firms of Apple Inc  AAPL.O , Google parent
Alphabet Inc  GOOGL.O , Amazon.com Inc  AMZN.O , Microsoft Corp
 MSFT.O  and Facebook Inc  FB.O , which reports after the bell
on Monday, are projected to grow 27.8%, Credit Suisse said.
    As the focus remains on corporate expectations for inflation
and how well they're handling supply bottlenecks, the stock
market heads next month into the typical sweet spot for returns.
    The S&P 500 from November through April has recorded the
highest average price change of any rolling six-month period,
according to The Stock Trader's Almanac. 
    Over that six-month period since 1992, the cyclical consumer
discretionary, industrials, materials and technology sectors did
better, up 9.6% on average compared to the S&P 500's 7.2% normal
gain, said Sam Stovall, chief investment strategist at CFRA.
    But the pattern is even more pronounced during the second
year of the four-year presidential term, Stovall said. Since
1992, the S&P 500 gained an average 11.5% on a total return
basis from Oct. 31 through April 20, he said.
    
    (Herbert Lash)
    *****
    
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 (Terence Gabriel is a Reuters market analyst. The views
expressed are his own)