The market is awfully volatile lately. One day, stocks are up big. The next, they plummet. And ultimately, they appear to be going nowhere while inflation and gas prices are roaring higher. Not to mention a war rages on in Europe and China struggles with a new wave of Covid-19 lockdowns.
Admittedly, it’s an ugly backdrop for stocks.
But at InvestorPlace, we like to say this isn’t so much a stock market as it is a market of stocks. The point is that even in a choppy market, certain sectors can buck the broader trend and head higher. Some may even boom while the market stalls out.
One space that could boom over the next few quarters? Energy stocks.
At least that’s how the world’s largest money manager sees things. Larry Fink, CEO of BlackRock (BLK) — an investment management firm that oversees $10 trillion in assets — believes today’s rising prices will “create an investment boom” in the energy industry.
We’re inclined to agree. While the market may be stuck in neutral, certain energy stocks could absolutely soar over the next few months.
Which stocks in particular? Let’s find out.
Near-Term Spending Boom in Fossil Fuel Energy Stocks
Larry Fink believes there’ll be two energy spending booms soon, both sparked by today’s elevated oil and gas prices. And we agree. The first will happen over the next few quarters. And the second boom will play out over the next few years.
The first incoming boom is a short-term spending surge on fossil fuel production, which should benefit oil and gas stocks.
Historically speaking, whenever oil and gas prices spike, you see those exploration companies start to rev up operations.
That’s because oil exploration is inherently a low-margin, high-expense business. Consequently, many exploration projects are only profitable if oil costs are above a certain level. So, when those prices rise, you see oil and gas exploration companies bring more projects online. That’s when those projects are actually profitable.
The current price…
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