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Focus on the Fundamentals When It Comes to Oil

Maleeha Bengali

In anticipation of this week, which led up to the finale of the high-level U.S.-China trade talks held in Beijing, all risk assets got a boost from a possible resolution as equities rallied 7% from the lows at the end of December. Oil rallied 20%, mining and tech stocks around 15% to 20%. Hence the rally, on back of an optimistic trade talks outcome this week, was more a classic case of short covering as seen by the hedge fund most-shorted-stocks basket rallying aggressively this week.