Why Did XLE Underperform Other SPDR ETFs?



Energy sector versus the Market

From June 9–16, 2016, the Energy Select Sector SPDR ETF (XLE) outperformed other market sectors. It fell ~3.2%. Let’s find out how XLE performed compared to other SPDR ETFs.

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XLE outperformed other SPDR ETFs

This week, the fall in crude oil (USO) (USL) (OIIL) is due to the rise in crude oil rigs on June 10. Markets are gripped with oversupply concerns due to the rise in oil rigs. As a result, XLE fell in the last six trading sessions.


The utility (XLU) sector rose the most. Between June 9 and June 16, XLU rose 0.15%. The Fed kept the key interest rate unchanged on June 15. It was followed by weak US non-farm payroll data on June 3. This helped utility stocks gain.

The above table shows XLE’s performance compared to the ETFs representing other sectors between June 9 and 16.

Oil-weighted stocks

Crude oil could close on a positive note this week. Last week, it rose 0.9%. The potential for continued downside in crude oil prices is an important factor for oil-weighted stocks such as RSP Permian (RSPP), Abraxas Petroleum (AXAS), and Clayton Williams Energy (CWEI).

In the next part, we’ll see what drove energy ETFs’ performance.


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