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.
What: Shares of companies in the oil and gas industry shot higher today as the stock market and oil prices all rose sharply. Pioneer Drilling
So what: Oil has spiked 3.6% today, rebounding after a week of worry over Europe's debt problems kept the fuel source near recent lows. The price of oil has a strong impact on service providers because producers will stop drilling if prices get too low, and there was fear that the downturn in prices would be long-lasting given Europe's extensive problems. For today, that fear has subsided, and the energy industry is hot again.
Now what: Everyone from driller Precision Drilling
The news out of Europe and the U.S. was positive today, but I would be cautious placing a big bet on a recovery and, therefore, oil at this point. Europe has a long way to go before its debt problems are over, and with growth still anemic in the U.S., I don't anticipate a sharp rise in oil prices in the near future. It might be prudent to sell the highs and buy the lows right now, because oil is probably in a bit of a holding pattern until we get an indication one way or the other of where the economy is headed.
Interested in more info on oil and gas stocks? Add them to your watchlist.
Fool contributor Travis Hoium has no position in any company mentioned. You can follow Travis on Twitter at @FlushDrawFool, check out his personal stock holdings, or follow his CAPS picks at TMFFlushDraw.
Motley Fool newsletter services have recommended buying shares of Precision Drilling. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.