NEW YORK (TheStreet) -- Recoveries have their own life cycles.
It usually starts with technology. Then banking and finance stocks recover. Housing recovers. And finally, at the tail end, you see improvement in industrials, basic materials and energy companies.
This recovery has been a little different. For one thing, it has been led by energy. According the the U.S. Department of Energy, in the past two years the U.S. has become self-sufficient in natural gas, and is meeting more domestic demand for oil, too. The U.S. Energy Information Administration (EIA) found that "the share of total U.S. consumption met by liquid fuel net imports peaked at more than 60% in 2005 and fell to an average of 40% in 2012. EIA expects the net import share to decline to 28% in 2014, which would be the lowest level since 1985." Much of this supply comes from the fracking boom powering the whole economy forward.
And no industry depends on gas and oil as much as the chemical industry, both for raw materials and to power processing.
Despite the energy recovery, some of our most emblematic chemical companies, Dow Chemical (DOW) and DuPont (DD - Get Report), have been lagging the market. Dow is only now approaching its 2011 high. DuPont only recently exceeded its best 2011 levels.
If we're where we're supposed to be in this recovery, then these two stocks should power ahead in 2014.
That's especially true since both companies are making strategic shifts aimed at higher profits.