Markets power higher as interest rates keep falling and US/China trade talks inch forward
Today's energy market update:
Traders were in a generally positive mood on Tuesday, buoyed by falling interest rates and progress on US/China trade talks.
The American Petroleum Institute is forecasting a small drawdown in crude stockpiles for last week, estimated at 812,000 barrels. Official numbers from the Energy Information Administration are due to be released Wednesday morning.
Today's treasury, currency and equity market update:
Global bond yields mostly moved lower on Tuesday, ahead of tomorrow's critical interest rate decision from the US Federal Reserve. German 10-year bonds fell to an unprecedented low of -0.32%, after ECB President Mario Draghi signalled intentions to either lower interest rates, or boost its bond-buying program. Most currencies were little changed on Tuesday.
US markets rallied sharply this morning, after President Trump announced plans to extend discussions with Chinese President Xi next week, ahead of the G20 meeting in Japan.
The NYSE, S&P 500 and TSX all rose about 1%. US energy stocks gained 1.4%, while the Canadian energy basket rose about 1%. All subsectors posted moved higher on Tuesday, with E&Ps leading to the upside.
Today's notable energy news:
As expected, the federal government re-approved the Trans Mountain Expansion Project (TMEP), paving the way for construction to restart later this year. Although an exact timeline was not provided, construction is expected to take about 2½ years, which would bring the in service date to early 2022 at best. Once completed, TMEP will add 590,000 bbl/day of export capacity to Canada's west coast, destined primary for refineries in Washington State, California and Asia. Opposition groups are expected to appeal the decision.
Anadarko Petroleum announced a positive final investment decision for the first phase of its US$20 billion Mozambique LNG project. Phase 1 will consist of two LNG trains with a total capacity of 12.9 million t/y. The company says there are about 5,000 workers already on-site, progressing construction. Once Occidental Petroleum completes its takeover of Anadarko, the project will be transferred to Total, who has yet to comment on the project. This is the largest single LNG project approved in Africa to date.
Production from Iraq's West Qurna 1 oil field, located in the southern region of the country, has increased from 440,000 bbl/day to 465,000 bbl/day, now that new processing facilities and storage tanks have been brought into service. West Qurna 1 was developed by ExxonMobil, and is expected to ramp up to 490,000 bbl/day.
|Suncor Energy||SU||41.69||▼0.0||35.53||55.47||D W|
|Imperial Oil||IMO||36.66||▲0.3||33.52||44.91||D W|
|Husky Energy||HSE||12.91||▲2.1||12.27||22.99||D W|
|TC Energy||TRP||65.99||▲1.0||47.90||66.93||D W|
|Pembina Pipeline||PPL||48.62||▲1.6||39.15||50.65||D W|
|Inter Pipeline||IPL||20.24||▲2.1||18.60||25.66||D W|
|Gibson Energy||GEI||23.53||▲2.4||16.90||23.77||D W|
|LARGE CAP E&P|
|Cdn Natural Res||CNQ||36.42||▲0.7||30.11||49.08||D W|
|Cenovus Energy||CVE||11.88||▲1.5||8.74||14.84||D W|
|Vermilion Energy||VET||27.71||▲1.1||26.54||49.67||D W|
|Pason Systems||PSI||18.91||▼-0.2||17.18||24.57||D W|
|Mullen Group||MTL||9.70||▲2.1||9.39||16.93||D W|
|Secure Energy||SES||7.08||▲4.1||6.25||9.44||D W|
|REFINING & MARKETING|
|Parkland Fuel||PKI||41.70||▼-0.6||31.35||47.45||D W|
|Exxon Mobil||XOM||75.74||▲0.9||64.65||87.36||D W|
|Kinder Morgan||KMI||20.80||▲1.4||14.62||21.25||D W|
|Williams Co||WMB||27.26||▲0.8||20.36||32.22||D W|
|LARGE CAP E&P|
|EOG Resources||EOG||88.30||▲3.3||80.41||133.53||D W|
|Occidental Petro||OXY||50.35||▲1.1||47.00||86.60||D W|
|Anadarko Petro||APC||69.91||▲0.2||40.40||76.70||D W|
|Pioneer Natural Res||PXD||149.79||▲3.6||119.08||195.00||D W|
|Baker Hughes||BHGE||23.09||▲3.1||20.09||35.55||D W|
|Ntl-Oilwell Varco||NOV||20.64||▲1.5||19.57||49.08||D W|
|Marathon Petro||MPC||49.64||▲1.9||45.47||88.45||D W|
|Phillips 66||PSX||86.80||▲1.0||78.44||123.97||D W|
|Valero Energy||VLO||77.80||▲1.1||68.81||122.42||D W|
Antero Resources (AR): Upgraded from Underweight to Equal Weight at Capital One.
Diamond Offshore Drilling (DO): Upgraded from Sell to Hold at SEB Equities.
Noble (NE): Downgraded from Buy to Sell at SEB Equities.
Ultrapar Participacoes (UGP): Downgraded from Overweight to Equal Weight at Morgan Stanley.
UPDATED: DAILY (END-OF-DAY)
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