Energy Sector Stands Out As March’s Sole S&P 500 Industry Gainer, But Retail Traders Wary Of The Road Ahead

In March, the energy sector was the only industry group to post gains in the S&P 500 index.

According to Bloomberg data, the S&P 500 Energy Index rose 4.1% in March, surpassing the broader equity market, which has fallen 6.9% over the last month.

The gains also topped a 1% rise in oil prices, which was supported by the prospect of further sanctions and tariffs on Russia.

According to analysts, investors had flocked to the sector based on a perceived safe-haven value amid concerns over the broader market’s growth due to tariffs.

U.S. President Donald Trump pledged to impose tariffs on all countries on Wednesday, which he has dubbed America’s “Liberation Day.” Trump has slapped tariffs on autos, steel, aluminum, and all imports from China.

“People are getting more concerned about inflation as these tariffs start to have a more meaningful impact,” Stacey Morris, head of energy research at VettaFi, told Bloomberg.

The S&P 500 Consumer Discretionary consumer sector has fallen 12.9% year-to-date (YTD), while the information technology sector has fallen 12.6%.

Energy stocks are also exposed to policy risk today, including tariffs.

Still, their valuations are reasonably low compared with other sectors, and dividends are relatively high, John Gerdes, an analyst at Gerdes Energy Research, told Barron’s.

Retail sentiment on Stocktwits about the Energy Select Sector SPDR Fund was in the ‘bearish’ (29/100) territory compared to ‘bullish’ (65/100) three months ago, while retail chatter flipped to ‘high.’

ConocoPhillips (COP), Exxon Mobil (XOM), and EQT (EQT) shares have gained between 5% and 13.7% YTD.

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