Oil prices stabilize but energy stocks continue downward slide
Today's energy market summary:
North American equity markets continued their downward slide, led lower by mega-cap technology names. The NASDAQ was the worst performer, tumbling 4.4%. Most US indices have now wiped out all gains for the year.
The TSX also dropped 2.5%, breaking down to the lows of late 2016.
Among TSX energy components, AltaGas (ALA.TO +0.5%) and Mullen Group (MTL.TO +0.5%) were the only patches of green. Several producers hit new multi-year lows again today.
All S&P 500 large-cap energy components declined on Wednesday, with Schlumberger (SLB -3.8%) and Halliburton (HAL -3.9%) once again sliding to multi-year lows.
European energy majors listed on the NYSE also posted losses for the day, pulled lower by a stronger US dollar, which rebounded to the highs of mid-August.
Today's notable market movers:
Royal Dutch Shell (RDS.A -2.7%) announced the start of production at Lula Extreme South in Brazil's Santos Basin. The FPSO, operated by PetroBras (PBR -3.9%), has the capacity to process 150,000 bbl/day of oil and 6 MMcf/day of natural gas. This is Shell’s 14th deepwater FPSO in Brazil.
Credit ratings agency Moody's cut Eni's (E -3.6%) long-term credit rating from A3 to Baa1, with a stable outlook. The downgrade is due Italy's 30.1% ownership of the oil major, and not related to the company's performance.
Pioneer Natural Resources (PXD -5.7%) warned investors it expects to take a US$135 million write-down in Q3 due to hedging losses. PXD is due to report third quarter results on November 7, 2018.
Today's notable third quarter earnings and analyst action:
Third quarter revenues at TechnipFMC (FTI -3.3%) declined 24% y/y to US$3.1 billion, while net income rose 13% to US$137 million. The company's backlog rose 9% to US$15.2 billion, with growth seen across all segments. The company says current softness in the US shale patch is likely "transitory."
CVR Refining (CVRR -6.4%), posted a net income of US$174 million, on sales of US$1.9 billion, up 34% y/y. The company processed 219,000 bbl/day of crude through its two refineries. Parent-company CVR Energy (CVI -6.4%) reported a net income of US$90 million on net sales of US$1.9 billion, also up 34% y/y.
|CURRENCIES & YIELDS|
|Imperial Oil||IMO||41.09||▼-3.9||33.43||44.91||84||D W|
|Husky Energy||HSE||18.75||▼-4.5||15.09||22.99||37||D W|
|Pembina Pipeline||PPL||43.99||▼-2.3||37.60||47.84||91||D W|
|Inter Pipeline||IPL||21.94||▼-2.1||21.36||27.92||55||D W|
|Gibson Energy||GEI||21.26||▼-2.4||15.68||23.04||98||D W|
|LARGE CAP E&P|
|Cdn Natural Res||CNQ||36.06||▼-2.0||36.00||49.08||12||D W|
|Cenovus Energy||CVE||10.89||▼-2.4||9.03||14.84||20||D W|
|Seven Generations||VII||13.62||▼-4.0||13.51||21.25||12||D W|
|Pason Systems||PSI||19.15||▼-2.7||16.05||22.10||69↓||D W|
|Mullen Group||MTL||15.37||▲0.5||14.10||17.12||85||D W|
|Secure Energy||SES||8.03||▼-0.4||6.98||9.82||61||D W|
|REFINING & MARKETING|
|Parkland Fuel||PKI||42.88||▼-2.2||24.36||47.45||98||D W|
|Exxon Mobil||XOM||77.62||▼-2.8||72.16||89.30||58||D W|
|Kinder Morgan||KMI||16.51||▼-3.1||14.69||19.83||61||D W|
|Williams Co||WMB||25.26||▼-2.5||24.00||33.67||52||D W|
|LARGE CAP E&P|
|EOG Resources||EOG||106.14||▼-4.5||95.67||133.53||33↓||D W|
|Occidental Petroleum||OXY||68.23||▼-3.4||62.47||87.67||31||D W|
|Anadarko Petroleum||APC||59.61||▼-3.6||46.75||76.70||36↓||D W|
|Concho Resources||CXO||134.61||▼-5.1||123.63||163.11||37||D W|
|Ntl-Oilwell Varco||NOV||36.85||▼-5.1||31.47||49.08||34↓||D W|
|Baker Hughes||BHGE||27.39||▼-5.2||25.53||37.76||11||D W|
|Phillips 66||PSX||95.30||▼-4.5||89.14||123.97||24||D W|
|Valero Energy||VLO||86.69||▼-5.4||75.84||126.98||9||D W|
|Marathon Petroleum||MPC||68.06||▼-5.6||55.87||88.45||23||D W|
Devon Energy (DVN): Upgraded from Equal Weight to Overweight at Capital One Financial.
Ensign Energy Services (ESI.TO): Upgraded from Market Perform to Outperform at Raymond James.
Marathon Oil (MRO): Upgraded from Market Perform to Outperform at Wells Fargo.
Whiting Petroleum (WLL): Upgraded from Market Perform to Outperform at Wells Fargo.
Trinidad Drilling (TDG.TO): Downgraded from Outperform to Market Perform at Raymond James.
QEP Resources (QEP): Downgraded from Outperform to Market Perform at Wells Fargo.
UPDATED: DAILY (END-OF-DAY)
• OIL PRICES REFLECT NEAR MONTH CONTRACT FROM THE NYMEX/CME GROUP
• EQUITY PRICES PROVIDED BY NYSE & TMX GROUP
• CHARTPACKS COURTESY STOCKCHARTS.COM (DIVIDEND ADJUSTED)
• OIL PRICES, FUTURES AND DIFFERENTIALS IN USD/BBL
• C5+ = EDMONTON CONDENSATE
• FUTURES CURVES SHOW PRICES FOR NEAR-MONTH CONTRACT (C1) AND NEXT 5-MONTHS (C2-C6)
• TSX SHARE PRICES IN CAD; S&P 500 PRICES IN USD
• ADR: AMERICAN DEPOSITORY RECEIPTS LISTED ON NYSE IN USD
• SHARE PRICE CHANGES (INCL. NEW HIGHS & LOWS) EXCLUDE DIVIDENDS
• BASED ON STOCKCHARTS TECHNICAL RANK (SCTR)
• REFLECTS RELATIVE STRENGTH AMONG OTHER ENERGY STOCKS (PERCENTILE RANKING)
• RISING RANK (↑) REFLECTS INCREASING RELATIVE STRENGTH
• FALLING RANK (↓) REFLECTS DECREASING RELATIVE STRENGTH.