Energy subsector ETFs
In the week ending May 24, major energy subsector ETFs had the following performances:
Last week, US crude oil prices fell 6.8%, while natural gas active futures fell 2%. The Brent-WTI expanded by $0.77 last week, which might have supported downstream stocks. US sanctions on Iran and Venezuela could be behind the expansion in the spread. The spread might remain higher this week.
Did oil drag energy ETFs?
With weaker energy commodity prices, the S&P 500 Index (SPY) fell 1.2%—an important factor for these ETFs’ price performance. Apart from earnings sentiments, the oil rig count, which is at a new one-year low, is a concern for the oilfield services subsector.
Energy sector performance
Last week, the Energy Select Sector SPDR ETF (XLE) fell 3.3%. XLE had the largest decline among the sector-specific SPDR ETFs under review. A downside in the equity market might have pulled down XLE’s returns apart from energy commodities’ weakness. The Utilities Select Sector SPDR ETF (XLU) rose 1.8% and outperformed SPDR ETFs. Most of the sector-specific SPDR ETFs closed in the red last week.