From Morgan Stanley's European analysts, a look at the relative performance of various sectors in the 6 months after (in dark blue) an oil price spike.
Fair warning for U.S. investors: This report is based on European data, but I'm presuming the impact is similar for U.S. sectors.
Fair warning for U.S. investors: This report is based on European data, but I'm presuming the impact is similar for U.S. sectors.
Bottom Line:
Energy, health care and consumer staples perform best. Utilities, telecomms, industrials and financials are NOT negatively impacted after a sharp oil spike.
As one would expect, though, the consumer discretionary (cyclicals) sector suffers the most because consumer discretionary dollars are directed to the higher cost of energy-related goods in lieu of discretionary purchases.
And, on balance, European stocks suffered losses in the -10% to -15% range 6 months before and after oil price spikes, suggesting that stocks in general suffer when sharp oil price spikes blindside the markets.
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