Last week, major energy subsector ETFs’ performances were as follows:
- The SPDR S&P Oil & Gas Exploration & Production ETF (XOP) fell 7.6%.
- The VanEck Vectors Oil Services ETF (OIH) fell 4.2%.
- The Alerian MLP ETF (AMLP) fell 2.9%.
- The VanEck Vectors Oil Refiners ETF (CRAK) fell 1.3%.
The expansion in the Brent-WTI spread, which we discussed in the previous part, might have limited CRAK’s downside. US downstream stocks account for ~30.1% of CRAK. The events, which we’ll discuss in Part 5, might impact the Brent-WTI spread this week. Natural gas prices fell 5.5% with more than a 4% decline in US crude oil last week. Weaker energy prices might have dragged upstream stocks.
US equity indexes
On February 1–8, US equity indexes had mixed performances. The S&P Mid-Cap 400 (IVOO) and the Dow Jones Industrial Average (DIA) rose 0.6% and 0.2%, respectively, while the S&P 500 Index (SPY) was unchanged during this period. These equity indexes have an exposure of 5.1%, 5.2%, and 5.9% to energy stocks, respectively.
Oil, the broader market, and energy ETFs
Last week, US crude oil March futures fell 4.6%, while the Energy Select Sector SPDR ETF (XLE) fell 3%. XLE fell the most among the sector-specific SPDR ETFs under review. In addition to oil’s fall, a decline in the bullishness in the broader market indexes might have played a significant role in XLE’s fall.
Last week, the Utilities Select Sector SPDR ETF (XLU) rose 2.1%—the largest gainer among the sector-specific SPDR ETFs. Most of the sector-specific SPDR ETFs closed in the red last week.
In the next part, we’ll discuss the top energy gainers last week.