February outlook: Retail, energy and a correction?
In perhaps a preview of what is to come, crude oil spiked in the final minutes of January trading. The 8 percent move Friday was the biggest single-day gain in 2½ years and showed how quickly a rebound could come as the shorts cover their six-month winning trade.
“Energy and materials are currently the two most underinvested sectors in the S&P 500, and this degree of ‘underinvestedness’ has previously led one to two quarter periods of relative sector outperformance,” said John Kosar of Asbury Research. “These data suggest favorable conditions for a resurgence in commodity prices that should start getting some traction over the next few months.”
