Sunday, October 25, 2009

Relative Performance of Energy

With a bevy of earnings from energy companies set to report this week, I thought it may be beneficial to take a birds eye view at the performance of the energy sector relative to the S&P 500 and other major sectors over the past 2 months. Given the resurgence we've seen with oil in recent weeks, one would expect that energy has performed relatively well (click image to enlarge).
[Source: Yahoo Finance]

Over the past 2 months (Aug 24 - Oct 23), the Select Sector Energy SPDR (XLE) is up about 10%. As the relative performance chart shows, it has succeeded in outperforming every other sector. As one would expect, XLE finds itself in the midst of a rather strong uptrend.

[Source: EduTrader]

The following heavy hitters are set to report this week:

Monday: National Oilwell Varco (NOV)
Tuesday: Valero Energy Corp. (VLO)
Wednesday: ConocoPhillips (COP)
Thursday: Exxon Mobil Corp. (XOM)
Friday: Chevron Corp. (CVX)

The question at hand is whether or not the earnings releases will add fuel to the energy sector fire, or curb its relative strength.

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