Friday, April 23, 2010

Midday Briefing for April 24th: Firm Energy Shares


Energy is an important market sector, as it reflects not only demand for energy-related companies, but also for energy as a commodity. If traders and investors are expecting global growth, that should show up in terms of greater industrial activity and increased demand for oil and other fuels.

Note the upside breakout among energy stocks (XLE; above) today, reflecting firmness in crude oil prices. Should we get runaway growth in the current low interest rate environment, one would expect that to eventually show up in the prices of raw materials and energy--and the companies in those sectors.
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2 comments:

Anh said...

Dear Dr. Brett,

Congratulations on your new career move. Your readers like myself will miss you. Your contribution to the DIY trading world has been tremendous.

I treasure your parting wisdom about trying to live a mindful life and making the best of yourself in any of your endeavors.

May YOU achieve the best of yourself.

Ebisu said...

The energy sector has been a strange laggard so far this year but in recent weeks it is showing increasing relative strength to the broad market, as crude slowly grinds upward and nat-gas remains off its lows.

And while many if not most of the energy equities are still a ways off their highs, a solid integrated like Chevron (CVX) as well as a quiet but strong energy service company like Oil States International (OIS) are pretty close to their 2008 highs.