Stocks that outperform and underperform following a 15% oil spike, according to history

Following a recent 19.5% surge in crude oil futures driven by escalating tensions between Israel and Iran, a historical analysis indicates potential investment opportunities and risks within the S&P 500. According to a CNBC PRO analysis using the Reflexivity AI tool, technology stocks like Advanced Micro Devices and Monolithic Power Systems tend to outperform in the month following such oil spikes, while shares of automakers like Ford and airlines like United Airlines, along with retailers like Target, tend to decline, reflecting concerns about consumer spending and increased operational costs. The analysis suggests a shift towards sectors perceived as resilient to rising energy costs and geopolitical instability.

Analysis

A recent 19.5% surge in crude oil futures, primarily attributed to escalating geopolitical tensions between Israel and Iran and consequent concerns over Middle Eastern supply stability—with Iran being OPEC's third-largest producer—has prompted a historical analysis of S&P 500 stock performance. This analysis, based on previous instances where oil prices spiked by more than 15% in a single month, indicates that technology stocks often outperform in the subsequent month as investors seek assets perceived as resilient to energy price shocks and broader geopolitical uncertainties. Notably, Advanced Micro Devices (AMD) has historically shown a median one-month gain of approximately 3.2% following such oil spikes; the company's shares are up 5.2% year-to-date and recently advanced over 9% driven by a positive outlook from Piper Sandler on its GPU business. Monolithic Power Systems (MPWR) has historically demonstrated the largest median gain at nearly 6.1% and its stock has risen over 16.5% year-to-date. Industrial firm Xylem (XYL), recognized for its water technology, also historically performed well with a 3.4% median move and an 8% year-to-date stock increase, recently receiving an overweight rating from JPMorgan. Transportation stocks CSX and C.H. Robinson were also identified as historical outperformers. Conversely, sectors vulnerable to increased operational costs and shifts in consumer spending, such as automakers and airlines, have historically underperformed. Ford Motor, for example, saw a median decline of over 1%, and its current sentiment is further pressured by the suspension of its 2025 financial guidance due to an anticipated $2.5 billion impact from tariffs. United Airlines experienced a similar median decrease. Retailer Target also historically features among the worst performers. Interestingly, energy companies NRG Energy and EOG Resources have historically posted declines after oil price surges according to the screener, despite the commodity's price increase, a pattern noted alongside broader energy stock underperformance this year. Moderna (MRNA) historically records the most significant median loss at 3.6% in the month following such oil price jumps.

Key Decisions for Investors

• Investors could consider allocating capital towards technology stocks, notably Advanced Micro Devices and Monolithic Power Systems, which have historically demonstrated resilience and positive returns following sharp oil price increases and are supported by favorable company-specific developments.
• It may be prudent to evaluate reducing positions or adopting a cautious stance on automakers like Ford and airline stocks such as United Airlines, as these sectors have historically underperformed and are vulnerable to increased operating costs and dampened consumer sentiment from sustained high oil prices.
• Explore opportunities in industrial companies like Xylem, which has historically performed well after oil spikes and benefits from positive analyst sentiment regarding its leadership in water technology.
• Exercise caution with energy producers such as NRG Energy and EOG Resources, which surprisingly show historical negative performance post-oil surges according to the data, and be particularly wary of Moderna, which has historically been the worst performer in these scenarios.