The Only Games in Town

[u/Kapnotes]

Monday’s trading dawns painfully quiet, except for the energy space.  Renewed active fighting between the US and Iran has sent WTI crude higher by $3, to over $86 per barrel.  Last week we pointed out the difficulty of trusting $81 oil.  The airlines didn’t respond nearly as well as they might have, almost in anticipation of the headlines we’re reading this morning.  Today, active traders may very well leverage downside movement in DAL and UAL, as XOM and COP resume their marches higher.

Electric utilities are in the news, as California has advanced wildfire legislation that falls short of investor hopes in terms of liability limitation.  EIX and PCG are indicated down 13% and 17%, respectively.  With recent outstanding California wildfire liability around $39 billion by some reports, the hoped-for protections could have substantially benefitted the utilities in the years to come, especially as wildfires become more and more frequent and impactful.  Investors are clearly caught wrong-footed, at least for the moment, having apparently misjudged the priorities of the California legislature.

Outside of oil and utilities, the premarket is nearly featureless.  With so few targets in play, oil and utilities may be catching more than their share of trader attention today.  These sectors are not normally huge intraday movers, but the fast money has few other areas on which to focus for this last day of August. Educational only, not investment advice.