As I've mentioned before, a number of my screens over the last several weeks seems to have been dominated by healthcare and refining names. Many seem to have wondered why refiners? Easiest way to answer- this chart from Bespoke Investment Group. Basically- margins are expanding quite rapidly which would mean that VLO, TSO, SUN and FTO are more or less printing money right now.
source: bespoke
Credit default swaps on VLO declined to only 363 BPs. However, SUN's CDS spreads have actually widened to about 530Bps, suggesting that SUN is the weakest one in the group.
Interesting pair trade could be something like short SUN/ long FTO.
Disclaimer- I do own some FTO plus remember this is not a recommendation in any way shape or form, simply some random thoughts on the matter :)
source for the charts: www.finviz.com
