Produced in cooperation with
For more information about ETFs, mutual funds and the broad array of services from Standard & Poor's, please visit MarketScopeAdvisor.com or call 877-219-1247 for a free trial.
It may be hard to believe, but while everyone was out enjoying their holiday office parties, buying gifts and eating too much, the U.S. economy appears to have shifted into growth mode.
More than a few recent economic indicators point to a strengthening U.S. economy.
The Conference Board's Leading Economic Index rose in November for a fifth consecutive month helping to "confirm the strength of the recovery, and suggest that the economy is reaccelerating after its late summer doldrums," according to Standard & Poor's chief economist David Wyss.
Consumer sentiment is at a six-month high, durable goods orders are running 14% ahead of last year's pace despite a hiccup in airplane orders, and new home sales are finally starting to increase as well. Plus, the S&P 500 has ended the year having recouped substantially all of the losses it suffered since Lehman Brothers declared bankruptcy in September 2008.
Another indicator of accelerating economic growth is the rising price of oil. In December, benchmark U.S. crude oil prices climbed past the $90 a barrel mark for the first time since early 2008, amid slumping domestic crude oil inventories and optimism that demand will rise as economic activity picks up.
Rising oil prices have helped energy stocks outperform the broader market in recent months.
Energy Switch
If favorable economic conditions persist into the New Year, investors may benefit from initiating or adding to their exposure to energy equities. Overall, S&P recommends a marketweight position for energy stocks.
Of the seven sub-industries, S&P analysts have a positive outlook for the Integrated Oil & Gas group, which dominates the sector's market cap, and are largely neutral on the others.
