Paul Hickey Shares Research On Sectors Performing Well When Crude Oil Is In Bear Market

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Paul Hickey of Bespoke Investment Group spoke on
CNBC's Fast Money
about sectors that should perform well during the periods of low oil prices. He said that falling oil prices have historically been good for the stock performance of every sector except the energy sector. When crude oil is in the bear market the S&P 500 has been rallying in 81 percent of the time. Since the crude oil is already in the bear market, Hickey analyzed stocks that perform well in the final stage of the bear market for oil and he concluded that the best performing sectors are consumer discretionary, consumer staples, health care and materials. Historically these sectors outperform the market at the end of the bear market and in the early stages of bull market for oil, said Hickey. In the last 30 years Hickey found four periods of declining oil prices that lasted for more than six months. The longest period of declining oil prices lasted for 540 day or approximately a year and a half. Crude oil is currently trading in the bear market for roughly a year and the S&P 500 has already traded 18 percent higher. Hickey concluded that volatility in crude oil is bad for the market, but once it settles down, low oil prices will be good for the economy.
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Posted In: CNBCMediaBespoke Investment GroupPaul Hickey
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