We’ve talked a lot this fragmented earnings season about how hot sectors are doing well enough to overcome the known patches of weakness. Today we know just how hot the heat gets . . . Big Oil has spoken, and the numbers are better than Wall Street expected.

ExxonMobil (XOM) booked $4.14 per share in profit last quarter. At most, we were holding out for $3.84, so this is a nice surprise that shows that the biggest player in the energy sector is making a lot more money than our calculations suggested.

This is probably as good as it gets. Factoring this into the longer-term models gives XOM roughly $12.30 per share profit this year and then the top line recedes to the $10 range next year.

If this was any other industry, this stock was insanely cheap even after soaring 50% YTD . . . and it’s even cheaper now. XOM is still available for well under 9X projected earnings over the next 12 months.

XOM historically takes a whole year to earn somewhere between $2 and $5 per share, so this is the biggest boom in over a decade here. It won’t last forever, but until global oil supply rationalizes or demand softens, this could be the “new normal” for awhile.

And it isn’t just XOM. Chevron (CVX) earned $5.82 per share last quarter. We were looking for closer to $5 . . . and either way, the stock is cheap here around 9X projected earnings.

All Wall Street needed from these companies was to confirm that the underlying business isn’t hitting any invisible inflationary craters. It isn’t. Oil is alive and well . . . and is doing better than outsiders dared to hope.

Of course high fuel prices hurt the airlines as well as anyone else who needs to transport goods and people. Those companies are feeling the burn. But oil is doing so well that its numbers are lifting the Wall Street benchmarks all the same.

Factor out energy and the S&P 500 would be staring at a 4% earnings decline last quarter, which is not fun. That’s all about transportation as well as consumer stocks. But add energy back to the other numbers already on the table and a 4% earnings increase is easily within reach.

Believe it or not, the economy that investors care about is still making year-over-year progress. It’s just that the gains are unevenly distributed. There are clear losers as well as clear winners.

Index funds need to take the bad with the good. We don’t. When you focus on individual stocks, you can overweight good and get some distance from the bad.

Energy is only 4% of the S&P 500. The market as a whole isn’t getting a lot of heat. XOM and CVX are almost half of the energy sector. Two stocks are all you need.