Full access to Entrepreneur for $5
Subscribe

Oil Recovers From a 7-Day Losing Streak, Energy Names Rally

Some of the top gainers of the S&P 500 yesterday are energy-related names APA Corporation (APA), Occidental Petroleum (OXY), Devon Energy (DVN), Diamo...

By
This story originally appeared on Zacks

U.S. oil futures settled Monday with a gain of 5.6% — the biggest daily percentage climb since March — on account of bargain buying. Prices also found support from a weaker dollar, which made the fuel cheaper to the holders of other currencies. That’s on the heels of a seven-day losing streak for WTI crude triggered by investor fears that the spread of the Delta coronavirus variant would significantly hamper oil demand.



On the New York Mercantile Exchange, WTI crude futures climbed $3.50 to settle at $65.64, after tumbling 2.2% on Friday to end at a three-month low of $62.32 a barrel. For the week, the contract fell 8.9%, marking the biggest weekly drop since October.

- Zacks

Fundamental Picture Remains Constructive

Despite some downside risk associated with the Delta variant-induced demand concerns, the energy market is on the mend with a supportive macro backdrop and stronger fundamentals. Widespread COVID-19 vaccine rollouts, the ongoing government stimulus and OPEC+ supply curtailments have contributed to this positive setup.



U.S. commercial stockpiles are down more than 13% since mid-March. Taking Cushing (the key delivery terminal for U.S. crude futures traded on the New York Mercantile Exchange) as an indicator, the oil market has already tightened considerably. Stocks have fallen under 34 million barrels at the key storage hub, the lowest since October 2018. There is also a marked improvement in gasoline demand on the back of rebounding road and airline travel. With all the tailwinds, the U.S. benchmark briefly hit a more than six-year high of $76.98 in July.

Energy Stocks Take Off

Yesterday’s value buying pushed the Energy Select Sector SPDR — an assortment of the largest U.S. energy companies — up 3.75% to be at the top of the S&P sector standings. Consequently, some of the biggest winners of the S&P 500 on Monday included energy-related names like APA Corporation APA, Occidental Petroleum OXY, Devon Energy DVN, Diamondback Energy FANG, Halliburton HAL and Marathon Oil MRO.



APA, carrying a Zacks Rank of #1 (Strong Buy), topped the S&P 500 list with a gain of 7.59%. Other notable energy movers include Occidental Petroleum (6.92%), Devon Energy (6.07%), Diamondback Energy (5.90%), Halliburton (5.49%) and Marathon Oil (5.41%).



You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.



 



Tech IPOs With Massive Profit Potential

In the past few years, many popular platforms and like Uber and Airbnb finally made their way to the public markets. But the biggest paydays came from lesser-known names.

For example, electric carmaker X Peng shot up +299.4% in just 2 months. Think of it this way…

If you had put $5,000 into XPEV at its IPO in September 2020, you could have cashed out with $19,970 in November.

With record amounts of cash flooding into IPOs and a record-setting stock market, this year’s lineup could be even more lucrative.

See Zacks Hottest Tech IPOs Now >>



Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

 

Devon Energy Corporation (DVN): Free Stock Analysis Report

 

Halliburton Company (HAL): Free Stock Analysis Report

 

Marathon Oil Corporation (MRO): Free Stock Analysis Report

 

APA Corporation (APA): Free Stock Analysis Report

 

Occidental Petroleum Corporation (OXY): Free Stock Analysis Report

 

Diamondback Energy, Inc. (FANG): Free Stock Analysis Report

 

To read this article on Zacks.com click here.

 

Zacks Investment Research