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.
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)