Daily Market Color February 2, 2016Weaker Oil Hits Stocks and Boosts Treasuries Global equities have declined once again while Treasuries rallied (down 6 to 7 basis points) across the curve as heavy pressure on oil prices renewed concerns over the health of the global economy. WTI crude temporarily slid below $30/barrel as traders refocused on supply/demand fundamentals with hopes for a supply-reducing agreement between OPEC and Russia quickly evaporating. Despite some optimism last week, Goldman Sachs said it was “highly unlikely” that OPEC would cooperate with Russia on production cuts, saying the biggest benefactor of such a move would be the United States. Higher oil prices would encourage ramped up production from US and other non-OPEC producers, recreating the global supply glut. Meanwhile, stockpiles remain on the rise and some of the world’s largest oil companies including BP and Exxon are not surprisingly reporting extremely weak earnings in this challenging environment. Hillary Clinton and Ted Cruz won their respective caucuses yesterday in Iowa, providing the first concrete voting data on the race to the White House. Clinton’s slight edge over Bernie Sanders was the closest Democratic caucus in Iowa history, while Ted Cruz upset Republican frontrunner Donald Trump, with Marco Rubio surging for a strong 3rd place finish. The market impact is negligible at this stage given the amount of time left until the general election, but it is one more contributing factor to the overhanging market uncertainty. More market impact from the election cycle is expected in the coming months, as candidates get more specific about their proposed policies/platforms and the field continues to narrow. There aren’t any significant US data releases today. The Fed’s George (hawk, ’16 voter) speaks at 1pm ET and there are a number of corporate earnings set to be released today.