Energy stocks roar toward their best year in three decades amid recovery in oil
It’s six months into 2021, and energy stocks are already on pace for their best year in more than three decades, leading some to believe the run may be due for a pullback.
The group pulled back on Thursday and Friday, but is still up more than 40% for the year. That’s almost double the 23% return for the real estate sector, which is the second-best sector. The S&P 500 is up nearly 12% this year.
Energy’s big start to the year means that even if the sector goes nowhere for the rest of 2021, it will still be the best year since 1990 by nearly 10%, according to Bay Crest Partners chief market technician Jonathan Krinsky.
The surge in energy stocks comes on the back of a recovery in oil prices, and as investors return to areas of the market that were left out of 2020’s rebound from the pandemic lows. The sector was also starting from a low base. In 2020, the group fell 37.3% for its worst performance since inception in 1989.