Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.
U.S. stock markets are moving higher today, but the results are a little more uneven than usual. The Dow Jones Industrial Average (DJINDICES: ^DJI ) is up just 0.11% as of 3:35 p.m. EDT, while the broader Nasdaq Composite and S&P 500 are up 1.14% and 0.52%, respectively. Google's earnings blowout has pulled the Nasdaq and S&P 500 higher today, given its heavy weighting on both indexes. The Dow doesn't get any benefit from that move, and with only 30 components, it's actually being weighed down by a 3.4% drop from UnitedHealth today.
Baker Hughes' revenue rose 8% to $5.8 billion in the quarter, and net income jumped 22% to $341 million, or $0.81 per share, after adjusting for one-time items. Both results came in well ahead of estimates.
Schlumberger's revenue was up 11% to $11.6 billion, and net income rose 20% to $1.71 billion, or $1.29 per share.
The driver for both companies was offshore demand in North America and growing demand in the Middle East and Asia. While shale drilling gets a lot of the attention in the U.S., it's offshore where these companies are making their money. Baker Hughes actually expects the U.S. drilling-rig count to drop 9% this year, partly because rigs are drilling 6% more wells than a year ago. That has the effect of subduing demand for Baker Hughes and Schlumberger, and it explains why North American offshore and overseas demand is so important for earnings.
Another top performer today is Pioneer Natural Resources (NYSE: PXD ) , up 3.8% a day after giving a presentation to investors. Pioneer Natural Resources is actually benefiting from low demand for onshore drilling rigs by exploiting its Spraberry/Wolfcamp shale holdings. This is the second-biggest oil field in the world, and Pioneer has the largest production in the area. If high oil prices hold up and the company continues to execute well, this could be a big winner in domestic oil-drilling.
Oil prices are up again
Oil prices aren't dropping far below $100 per barrel again unless we enter another recession. That may be bad news for your pocketbook, but for investors that are positioned to profit from the return of $100 oil it poses an opportunity. To help investors get rich off of rising oil prices, our top analysts prepared a free report that reveals three stocks that are bound to soar as oil prices climb higher. To discover the identities of these stocks instantly, access your free report by clicking here now.