Sector movers: Oil stocks down as investors mull US elections, output recovers

Goldman Sachs sounded a 'bullish' note on the outlook for crude oil prices even in the event of a US presidential election win by Democratic party hopeful Joe Biden.

Despite Biden's green energy proposals, the impact on US shale oil production was expected to have a positive effect on prices.

So too, the market had become too pessimistic on the expected drag from a resumption of Iranian oil exports in 2021 - another possible result of a Biden administration.

For oil equipment and services names on the other hand, the implications would be wholly different, investors appeared to judge.

Crude oil futures were also lower at the start of the week, as production in the US Gulf of Mexico started to come back on line, as did output from Libya's largest field, El Sharara.

Aerospace was also in focus, with investors taking some profits on Rolls Royce following a week-long rally that had seen its shares roughly double in value.

On a related note, CMC Markets UK's Michael Hewson weighed in telling clients: "While some have suggested that part of the rebound may have been partly driven by bid speculation, this seems unlikely given the failure of KIO and Singapore’s GIC in this regard, with the UK government's golden stake a big obstacle.

"It seems more likely that having removed the doubts over its short-term future, with the securing of extra funding, investors are taking a longer-term view that the company is now in better shape to reorientate its business model to deal with the challenges of the next ten years."

Top performing sectors so far today

Automobiles & Parts 2,760.41 +2.68%

Leisure Goods 26,787.43 +2.48%

Electricity 7,764.17 +2.21%

Forestry & Paper 19,019.54 +1.93%

Equity Investment Instruments 11,706.49 +1.24%

Bottom performing sectors so far today

Oil Equipment, Services & Distribution 3,959.61 -3.21%

Aerospace and Defence 3,179.63 -2.73%

Oil & Gas Producers 3,586.84 -2.22%

Travel & Leisure 6,782.64 -1.80%

Mining 18,247.41 -1.03%