XLE - This Underrated Natural Gas Stock Could Rally Double-Digits Soon | Benzinga
A new commodity cycle is approaching for energy stocks; leading the way in this momentum gauge is the Energy Select Sector SPDR Fund (ARCA:XLE). The exchange-traded fund (ETF) outperformed the broader S&P 500 by 2% in the past quarter. While not much to speak of, this performance gap may show the beginning of a new trend that could last much longer.
Oil prices broke out – and stood comfortably – above their $79 a barrel ceiling. Now breaking above the $83 a barrel mark, predictions made by analysts at The Goldman Sachs Group Inc. (NYSE: GS) could come true. The investment bank thinks oil prices could go as high as $100 in 2024.
However, natural gas prices, which tend to follow oil prices, are now at a four-year low. This wide gap is counter to historic trends, and a catch-up in natural gas prices could make stocks like Natural Gas Services Group Inc. (NYSE: NGS) break out into new highs. Wall Street institutions see the opportunity, which starts here.
Once in a Cycle
Now that the Federal Reserve (the Fed) is considering cutting interest rates this year, money is getting ready to rotate. Because interest rates could be detrimental to the dollar index, commodities like gold and oil have started and amplified their rallies.
More than that, a weaker dollar could make American exports more attractive ...