Daily Chemical Reaction
Anything But Back To Normal – Thoughts On Late 2Q Optimism, Asia-US Price Spreads & Other Items
- US business optimism is rising per recent Fed survey and aligns with 2Q chemical sector pre-releases noting improvement from April/May lows– we are much less convinced and discuss several potential headwinds in 2H20.
- US benzene markets have tightened meaningfully relative to Asia during the past ~6 weeks – we think this could serve as a headwind for non-integrated US producers, such as Huntsman and Olin in epoxies, Kraton in Styrenics and ASIX in nylon.
- Other items worth note today target more producer reports announcing “better-than-expected” 2Q20 results, energy and commodity chemical items of note, and varying reports targeting the global EV and vehicle market.
See PDF below for all charts and tables