Wall St Week Ahead: Recession fears pose challenge to energy shares after stellar year

Some investors worry that energy companies may find it hard to increase profits after huge jumps in 2022, especially if a widely expected U.S. economic downturn hits commodity prices. — Reuters

NEW YORK: A potential US recession and tough comparisons to a stellar 2022 are weighing on the prospects of energy stocks delivering an encore to last year’s stunning run, despite valuations that are seen as still comparatively cheap.

The S&P 500 energy sector is up 4.2% year-to-date, slightly lagging the rise for the broader index. The sector logged a 59% jump in 2022, an otherwise brutal year for stocks that saw the S&P 500 drop 19.4%.