History Might Not Repeat Itself….
But it certainly rhymes. Below is the chart from Novel Investor that shows the annual returns for the S&P 500, and the 11 major S&P sectors. Looking at the “green” highlighted energy group (what irony), one can see that the XLE is poised for a third consecutive year as being the worst actor. Notice it did so as well in 2014-15, and doing what the market likes to do confounding the most, it was the best actor in 2016. This year with a couple weeks left the XLE is lower by 28%, one of just four of the major S&P sectors in the red. There are some intriguing plays within, and if one is hungry for yield as negative yielding paper skyrockets around the globe, KMI may fit the bill with a dividend yield better than 7%. It sports a bull flag with a CLOSE above 15 carrying a measured move to 19. The last 3 weeks all CLOSED very taut within just of each other, after the 2 weeks ending between 11/13-20 ramped higher by 23%.