Russian oil and an EU downturn

The good news: Russia will turn the Nord Stream 1 pipeline back on.?The bad news: Europe's energy crisis is far from over.?

Phil Rosen here, guzzling a midweek coffee in New York City. Moscow's recent maneuvers have included tapering energy flows and circumventing Western sanctions, all while carrying out its war on Ukraine.?

And, depending on how the next several days unfold, its next move may determine the if and when of a European recession.?

Okay — let's talk shop.?

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1. After much anxiety, Nord Stream 1 will reopen on schedule.?But, according to a Reuters report, gas flows are going to be trickling in at?reduced levels starting Thursday.

The pipeline, which was shut down for maintenance this month, is responsible for more than?one-third of Russia's natural gas exports?to Europe. But even before it went offline last week, Gazprom had slashed deliveries by 60% — which prompted European officials to accuse the Kremlin of?weaponizing energy flows.?

The fate of the pipeline — and whether Russia would turn routine maintenance into a lasting shutoff — was the source of significant anxiety this month for European leaders facing a worsening energy crisis.

And there's good reason for concern.?Russian President Vladimir Putin said flows to Europe could be cut further to 20% of capacity?due to problems with equipment.

The EU early Wednesday asked governments to be conservative with their?energy use, as the IMF warned that in the event of a full Russian gas cutoff,?Europe's economies would sink into severe recessions.

However, even as the EU economy teeters, the world's biggest crude exporter seems to be doing just fine. Saudi Arabia is on pace to notch its?best oil shipping month since 2020, and China's influx of crude imports have helped the cause.?

And to bring it back to Moscow — it's worth noting that?Saudi Arabia more than doubled its imports of Russian oil?in the second quarter to free up the Kingdom's own crude for exports.

In other news:

2. These deeply discounted stocks can beat their peers in the travel and service sectors, according to Morningstar's chief US market strategist.?Dave Sekera broke down his top picks amid a recession-resistant shift in consumer spending patterns.?See his list of 13 names here.?

3. BlackRock equities investment chief said it's time to shift money from US stocks and cash into beaten-down European companies.?He laid out the three key reasons why investors should make the move —?and exactly what part of the market to buy into now.?

4. An investment analyst at a $31 billion firm said home prices are on track to fall?back toward their pre-pandemic levels.?"The US housing market is due for a reset," said Penn Mutual Asset Management's Michael Cook.?He shared three cities where declines will be among the worst in the country.

5. Netflix reported earnings after the bell Tuesday, and its stock jumped.?The company was coming off of a first quarter earnings disaster, and the streaming giant spent months revamping its business, laying off employees, and planning a less expensive subscription tier.?This is where things stand now after Netflix said it lost more subscribers.

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