The energy sector has pulled ahead of utilities for top honors among S&P 500 sectors this year.
The Energy Select Sector SPDR (NYSEArca: XLE) entered Monday with a 14.4% year-to-date, 90 basis points better than the Utilities Select Sector SPDR (NYSEArca: XLU) and nearly 230 basis points better than the Health Care Select Sector SPDR (NYSEArca: XLV), the third-best of the nine SPDR ETFs this year.
XLE and it rivals energy ETFs, particularly the traditional cap-weighted offerings, face a week of important tests as the energy sector takes its turn entering the earnings confessional in a big way. The energy earnings party gets started in earnest tomorrow with National Oilwell Varco (NYSE: NOV) and Anadarko Petroleum (NYSE: APC), a combined 5.6% of XLE’s weight, reporting.
Anadarko, which has benefited in part from the renewal of an old takeover rumor and the resolution of environmental cleanup claims, ending two years of litigation, is one of this year’s best large-cap energy names with a gain of 39%. [Takeover Rumor Helps This Oil ETF]
Wednesday is another important day for the sector with Phillips 66 (NYSE: PSX) and Williams Cos. (NYSE: WMB), also a combined 5.6% of XLE, reporting. Put simply, Thursday is an epic day of energy earnings, led by Dow component Exxon Mobil (NYSE: XOM), the largest U.S. oil company.
In addition to Exxon, ConocoPhillips (NYSE: COP), the largest U.S. independent oil company, Occidental Petroleum (NYSE: OXY) and Apache (NYSE: APA) also report. Those stocks combine for 24.7% of XLE’s weight.