Keep pulling the thread on Emanuel Datt.
Datt Capital executed a 'hard reset' of its portfolio by reducing risk, rotating into energy exposures, and increasing its cash position.
Refinery crack spreads have increased by 3 to 4 times compared to pre-conflict levels, which is expected to materially impact refinery economics.
The Australian federal government has announced a 20% domestic reservation policy for Liquefied Natural Gas (LNG).
Emanuel Datt speculates that large investors are now viewing large-cap corporations as a safer investment than sovereign governments due to high global government debt levels.
BHP was recently considering the divestment or breakup of its BMA (BHP Mitsubishi Alliance) joint venture.
Datt Capital increased its cash position from high single-digit percentages before the recent conflict to approximately 30% currently.
Atlantic Lithium (A11), a lithium developer based in Ghana, received a takeover bid from a Chinese company.
Datt Capital's portfolio rotation was focused on midstream refiners, prompted by the impact of conflict on major refineries in the Middle East.
Datt Capital added exposure to thermal coal due to a large portion of seaborne LNG from Qatar being limited by attacks.
The Australian 10-year bond yield is approximately 5%, while the US 10-year bond yield is around 4.6%.
The Australian dollar has risen to 72 US cents, up from approximately 65 US cents before the recent conflict.
Recent strength in the S&P 500 has been concentrated in mega-cap stocks and has occurred in conjunction with negative market breadth.