Executive Briefings

Chemicals Market Could See Trillion-dollar Sales by 2018

After battling strong headwinds in 2013, chemical stocks have begun to bounce back this year driven in large part by the surging shale energy boom and a booming North American market. While any downturn in the economy could weigh on this cyclical sector, market dynamics and management strategies look poised to reward investors with performance gains and respectable dividend yields.

The good news: The fortunes of chemical stocks are improving. The value of U.S. chemical sales is expected to top $1tr in 2018, up from $789bn last year, according to the American Chemistry Council.

The bad news: Sluggish economies in Europe and a slowdown in China have weighed on the global chemicals market.

That said, the outlook for chemical stocks is improving — worldwide chemical production will rise 3.8 percent this year and 4.1 percent in 2015. Another good sign: chemical companies are investing heavily in research and development — the ACC estimates that R&D investment will hit $68.7bn in 2018 – up from $56.6bn in 2012.

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The good news: The fortunes of chemical stocks are improving. The value of U.S. chemical sales is expected to top $1tr in 2018, up from $789bn last year, according to the American Chemistry Council.

The bad news: Sluggish economies in Europe and a slowdown in China have weighed on the global chemicals market.

That said, the outlook for chemical stocks is improving — worldwide chemical production will rise 3.8 percent this year and 4.1 percent in 2015. Another good sign: chemical companies are investing heavily in research and development — the ACC estimates that R&D investment will hit $68.7bn in 2018 – up from $56.6bn in 2012.

Read Full Article