Shares of oil and gas companies rose as traders rotated back into economically risky sectors.
An increased risk appetite, the implications of a recently passed tax cut, and better-than-expected earnings and economic data have caused a "melt-up" in the stock and oil markets to start the year. The price of oil has surged to more than $70 a barrel in London trading and the combination of high commodities prices and tax cuts promise an earnings bonanza for global energy companies this year.
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Still, Oliver Pursche, chief investment strategist for broker-dealer Bruderman Brothers, doesn't expect the sector to continue its outperformance. "Energy has gone up sharply already," said Mr. Pursche. "We don't necessarily see oil going up another 100% like it has in the last six months ... the tailwinds that the energy sector has benefited from could diminish."
Rob Curran, firstname.lastname@example.org
(END) Dow Jones Newswires
January 17, 2018 17:09 ET (22:09 GMT)