Rising Oil Boosts The Fortunes Of Biofuel Stocks (SYNM, VRNM, BIOF, ADM, CZZ)
Oil just continues to move higher. After spiking on news of escalating political tensions in the Middle East, oil is once again moving to the upside after the U.S. Energy Department said oil inventories surprisingly declined by 364,000 barrels to 346.4 million barrels last week and the news is good for the Ethanol and Biofuel Stocks Index, which is up 3.9% today.
On a historical basis, alternative fuels come into the spotlight when oil prices surge and analysts and economists speculate that rising prices at the pump could crimp economic activity. That may be the case again today as investors seem to be favoring ethanol and biofuel stocks.
On no stock-specific news, BioFuel Energy (BIOF) is surging 16%, but it is one of the smallest members of the Index by market value with a market cap of less than $29 million.
Most Index members have market values of less than $300 million, but Archer-Daniels Midland (ADM), by far the largest Index constituent, is slightly higher today while Cosan (CZZ) with a market value of $3.6 billion is up 4%.
Investors can track the Ethanol and Biofuel Stocks Index for performance trends and a suite of other metrics at tickerspy.com.
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