This Commodity Could Surge On The Coming Midterm Elections
Natural gas is down 15 percent in the past month. Yet according to Larry McDonald, senior director at Newedge, this may be a buying opportunity. Normally, predictions from a single market participant don’t warrant too much attention from this blog. But McDonald predicted the subprime mortgage crisis (and the subsequent collapse of his old firm Lehman Brothers) two years before it happened. On “Talking Numbers” back in January, he correctly predicted Puerto Rico would have trouble selling debt. And very recently on TN, McDonald also predicted that the Russian stock market would rally. It did, and up until very recently, was among the top performing indexes in the world.
Now McDonald is making another contrarian call. He believes there’s one market where sellers have sold as much as they can, creating an opening for buyers: natural gas. “What we’re seeing is a tremendous amount of capitulation,” McDonald said. “We’re seeing what I would call ‘seller exhaustion.’ We’re getting very close to that period. And with the election coming up in the fall, we see substantial upside for natural gas as well as natural gas producers.”
McDonald believes one of the biggest catalysts for Nat Gas will be the midterm elections for the U.S. congress.
You can see the full “Talking Numbers” segment below:
Related: United States Natural Gas Fund, LP(NYSEARCA:UNG), Exxon Mobil Corporation(NYSE:XOM), Chesapeake Energy Corporation(NYSE:CHK)