Domestic Oil Boom
Another stock that is working well in this market is Continental Resources
(CLR). This name also broke out to new highs. Continental Resources is an oil and gas exploration company and the #1 leaseholder in the Bakken region, which is at the forefront of America's domestic oil boom.
CLR data by YCharts
I featured Continental Resources in my book Best Stocks Now back in February 2011 and the stock is up 124% since then.
The company, led by billionaire oilman Harold Hamm, has recently caused quite a stir by filing for a permit from the U.S. government to export oil. While the U.S. still has a shortage of heavy crude, it actually has a surplus of light sweet crude. There has been a ban on U.S. companies exporting oil since the oil embargo of 1975.
This is going to be an interesting story to watch going forward as our country moves closer toward energy independence. I predict leading energy stocks will replace biotech this year as the place to be in this market.
Railroads Are WorkingThe Transportation sector has been one of the leading sectors this year and the railroads have been a big part of this move. One of my favorite railroad names is Union Pacific (UNP), another company breaking out to new highs!
UNP data by YCharts
Union Pacific serves the fastest growing population centers in the Midwest and West Coast regions. It also connects with Canada's rail systems and is the only railroad serving all six major Mexico gateways. This geographic advantage has helped it maintain pricing power and lock in more profitable contracts. Union Pacific is an economic recovery play, but it is also a beneficiary of the domestic oil boom in this country. We don't have enough pipelines here in the U.S. which has led many oil producers to transport their products the old fashioned way, via rail. More Energy Beneficiaries These same positive trends in the Energy sector are creating opportunities for Canadian rail stocks such as Canadian National Rail (CNI) and Canadian oil stocks like Canadian Natural Resources (CNQ). Top quality Energy Service names are also moving higher in this market. Two names I own in this industry group are Halliburton (HAL) and Schlumberger (SLB). And Don't Forget India! While there are finally some trends to exploit in the U.S. market, another trend that has been working outside the U.S. is the India story. The new pro-business regime in India and the prospect of economic reform has created tremendous opportunities for this market. In the absence of direct investment in India companies, there are many other ways to capture exposure to this market trend such as (INP).
INP data by YCharts
Finally several trends have emerged this year for investors to exploit in this market. So even though the DOW is up just 2% year to date, there are some great opportunities in this seemingly trendless market if you are looking in the right places. At the time of publication the author was long URI, CLR, UNP, CNI, CNQ, HAL, SLB and INP. This article represents the opinion of a contributor and not necessarily that of TheStreet or its editorial staff. >>Read more: S&P 500 Hits First Resistance Area, Now Should Consolidate
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