Energy: Fueling A Race To The Bottom

by: S&P Dow Jones Indices

By Chris Bennett

While consumers may enjoy the additional purchasing power provided by a decline in energy prices, Energy sector investors would prefer that they had a little more pain at the pump.

The Energy sector of the S&P 500 is having a year to forget. The index is down 20% year to date on a total return basis (through 12/7/2015), and faces continued headwinds, as oil prices remain stubbornly low. (The S&P GSCI Energy sector is down 37% year to date.) Due to its recent struggles, the market capitalization of the S&P 500 Energy sector is down over $350 billion since the end of 2014.

Poor performance in the Energy sector is having a material impact on the return of the S&P 500. Year to date, the S&P 500 is up 2.89%, while the S&P 500 ex Energy is up 4.95% (both on a total return basis).

Blog chart

Declines in the Energy sector have occurred across capitalization ranges. In fact, when compared to the performance of small-cap Energy, the S&P 500 Energy Sector performance seems almost muted.

There is little time left in 2015 for the sector to make a recovery. So far, all it has fueled is a race to the bottom.

Disclosure: © S&P Dow Jones Indices LLC 2015. Indexology® is a trademark of S&P Dow Jones Indices LLC (SPDJI). S&P® is a trademark of Standard & Poor's Financial Services LLC and Dow Jones® is a trademark of Dow Jones Trademark Holdings LLC, and those marks have been licensed to S&P DJI. This material is reproduced with the prior written consent of S&P DJI. For more information on S&P DJI and to see our full disclaimer, visit