For much of 2010, the energy sector has been in focus, particularly the crude oil corner of the market. As the Deepwater Horizon spill quickly became one of the worst environmental disasters in U.S. history, the Obama administration issued an offshore drilling moratorium, that was only recently revoked. All the while, oil was sitting below $75 per barrel, thanks to weak growth prospects and a currency crisis in Europe that cast a shadow of doubt on the industry as a whole. But as oil prices have begun to climb once again, thanks to increased demand from emerging markets and a weak dollar, the oil industry may finally be poised for a triumphant return to strong levels of growth [see also Next Frontier Of ETF Investing: Long/Short Trades].
When most investors think of Big Oil, Exxon Mobil
Today, Petrobras is set to release its earnings report, which analysts have predicted will show EPS of $0.83 for the most recent quarter. But what has many investors worried is the recent sale of shares to complete a deal the company predicted would double its output in just a decade. Overall, the company sold 2.4 billion common shares and raised close to $70 billion in what was the largest sale share in history in an effort to fund more offshore drilling ventures in areas recently purchased from Brazilian government. While this deal seems likely to greatly expand the company's output, many investors fear that the company overpaid for these rights, and in the end will have sunk more money into the project than can be recouped from the investment [see Brazil ETF (EWZ) In Focus After Puzzling Petrobras Deal].
As Petrobras releases its highly-anticipated earnings, the iShares Latin America 40 Index Fund
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