Here are the key takeaways:
- Measuring Oil Surges & Stock Returns: The chart illustrates how the S&P 500 has historically performed over the following year after 2-day oil price surge of 20% or more, dating back to 1986.
- A Look at the Data: There have been 8 unique instances of oil surging 20% or more over a 2-day period (since 1986). In 7 of 8 cases, the S&P 500 was higher one year later.
- Investment Implications: While past performance isn’t indicative of future results, the chart shows the S&P 500 has historically remained resilient in the year after 2-day oil price surges above 20%—a reminder that such spikes haven’t typically been bad news for stocks on average.
