As recently as 10 years ago, a $4 drop in the price of crude oil prior to an OPEC meeting and worries over the cartel lacking any consensus would be a huge positive for the stock and bond markets.<\/p>\n
Not so much anymore.<\/p>\n
OPEC seems broken, fossil fuels are on the decline, and clean energy and fracking has broken the grip of crude oil on the US economy, but recent comments by President-elect Trump could provide some relief for the sector.<\/p>\n
Energy has been the best performing sector in the SP 500 year-to-date (that could be a surprise to many), overtaking the safety and dividend trades that drove utilities and staples for the first 6 months of 2016.<\/p>\n
Here is the quick take on crude oil and the Energy complex today:<\/p>\n
The Energy sector has been written about here<\/a>, here<\/a> and here<\/a>.<\/p>\n The seemingly overwhelming negative sentiment in Energy today, based on what many THINK we’ll hear out of OPEC tonight or tomorrow, means I’ll maintain the Energy overweight.<\/p>\n Our position is more earnings-based over the next 2 -3 quarters than anything else (crude oil prices).<\/p>\n Energy sector profits were wiped out entirely in Q1 ’16.<\/p>\n Client accounts have an 8% – 10% Energy weight in accounts, with Energy having a 7% market cap weight within the SP 500. Positions are XLE, IYE, and the OIH.<\/p>\n The fact that the “experts” think that nothing positive will come out of Vienna has me still leaning positive for crude oil prices.<\/p>\n We’ll see in the next 24 hours. I could be very wrong and crude could head back to $39.<\/p>\n (Positions can change at any time.)<\/p>\n <\/p>\n <\/p>\n","protected":false},"excerpt":{"rendered":" As recently as 10 years ago, a $4 drop in the price of crude oil prior to an OPEC meeting…<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[171,95],"tags":[],"class_list":["post-6507","post","type-post","status-publish","format-standard","hentry","category-energy-etfs-xle","category-energy-sector"],"jetpack_featured_media_url":"","jetpack_sharing_enabled":true,"post_mailing_queue_ids":[],"_links":{"self":[{"href":"https:\/\/fundamentalis.com\/index.php?rest_route=\/wp\/v2\/posts\/6507","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/fundamentalis.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/fundamentalis.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/fundamentalis.com\/index.php?rest_route=\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/fundamentalis.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=6507"}],"version-history":[{"count":3,"href":"https:\/\/fundamentalis.com\/index.php?rest_route=\/wp\/v2\/posts\/6507\/revisions"}],"predecessor-version":[{"id":6510,"href":"https:\/\/fundamentalis.com\/index.php?rest_route=\/wp\/v2\/posts\/6507\/revisions\/6510"}],"wp:attachment":[{"href":"https:\/\/fundamentalis.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=6507"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/fundamentalis.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=6507"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/fundamentalis.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=6507"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}