S&P 500 Energy sector on track for biggest weekly gain since October 2022
XLE•Energy sector leads S&P 500 gainers
The S&P Energy sector .SPNY, leading the gainers among the 11 major sectors of the S&P 500 on Friday with a 1.4% rise, is poised to notch its biggest one-week percentage gain since October 2022.
Oil majors ExxonMobil XOM.N and Chevron CVX.N provided the biggest boosts to SPNY on the session: XOM was up 1.4%, while CVX climbed 1.6%.
Moves track crude prices amid year-to-date strength
The index, currently up about 7.5% since last Friday's close, has largely followed crude prices; front-month WTI CLc1 is up about 4.3% on the week O/R.
Year-to-date, SPNY and WTI have gained about 38% and 42%, respectively.
On February 28, the U.S. and Israel began airstrikes against Iran, resulting in the closure of the Strait of Hormuz, through which about one-fifth of the world's crude is transported, putting upward pressure on energy prices.
Increasing energy prices are causing broader inflation to heat up, leading to an increasing likelihood of a rate hike from the U.S. Federal Reserve by year-end; financial markets view a 25 bps rate hike as the most likely outcome of the Fed's December meeting.
Of the 20 constituents of the SPNY, only Expand Energy EXE.O is down so far this year; of the remaining 19, all but one have enjoyed at least double-digit gains YTD.
