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Is Oil Dragging US Equity Indexes?

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US equity indexes

Between May 18 and May 25, US equity indexes had the following performance results:

  • The S&P 500 Index (SPY) rose 0.3%.
  • The Dow Jones Industrial Average Index (DIA) rose 0.2%.
  • The S&P Mid-Cap 400 Index (IVOO) rose 0.2%.

Approximately 5.5%, 5.2%, and 3.8%, respectively, of the equity indexes are energy stocks.

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Is oil dragging US equity indexes?

Between May 18 and May 25, US crude oil July futures fell 4.9%. During this period, the Energy Select Sector SPDR ETF (XLE) fell 4.5%—the largest fall among the SPDR ETFs that break down the broad market’s performance into subsectors. The Utilities Select Sector SPDR ETF (XLU) rose 3.1%—the largest gainer on our list during this period.

The fall in oil prices could have dragged energy stocks—a factor that might have limited the upside in these US equity indexes.

Energy ETFs

Between May 18 and May 25, the subsectors in the energy sector had the following performance results:

  • The VanEck Vectors Oil Services ETF (OIH) fell 7.4%.
  • The SPDR S&P Oil & Gas Exploration & Production ETF (XOP) fell 5.3%.
  • The VanEck Vectors Oil Refiners TF (CRAK) fell 3.2%.
  • The Alerian MLP ETF (AMLP) fell 2.6%.

The downturn in oil prices could have dragged these energy ETFs.

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