Thanks to the fast-paced economic recovery and growing demand, the basic materials sector rebounded from the pandemic lows last year. Moreover, commodity prices have rallied since the beginning of 2022 amid accelerating inflation rates and increasing operating costs amid worsening supply chain disruptions. Further, the recent Russia-Ukraine geopolitical crisis led to a sharp spike in commodity prices.
The bullish sentiment surrounding the basic materials sector is evident as iShares U.S. Basic Materials ETF (IYM) gained 12% over the past year. The current market trends will likely maintain a bullish outlook on the sector for the coming months.
