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Wednesday's Energy Stocks: Markets close higher as Fed keeps rates steady


According to Market Intelligence, December 2022


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Wednesday's Energy Stocks: Markets close higher as Fed keeps rates steady

U.S. stocks rebounded from the prior day's downtick and closed the Wednesday, Dec. 11, session with minor gains after the Federal Reserve indicated that it will keep interest rates at current levels through the whole of next year. The Dow Jones Industrial Average added 0.11% to 27,911.30, and the S&P 500 exited the session up 0.29% to 3,141.63.

Major oil and gas companies ran the other way of their equity market counterparts, with the S&P 500 Energy Sector closing the Dec. 11 session down 0.16% to 436.81.

Losses were noted at Marathon Petroleum Corp., which shed 2.66% in active trading to $57.11. EQT Corp. tumbled by 2.64% to $8.85 and Valero Energy Corp. slipped by 1.78% to $92.89, both on below-average volume.

Chevron Corp. noted a 1.41% decline in active trading to $116.23 after a Dec. 10 announcement that it expects to take a noncash, after-tax impairment charge of $10 billion to $11 billion in the fourth quarter, with more than half of the write-down driven by its Appalachia gas shale assets. Analysts said that the oil supermajor may struggle to find buyers for its Appalachia shale gas assets.

On the flip side, Schlumberger Ltd. added 2.84% on above-average volume to close at $38.40.

Talos Energy Inc. rose by 5.23% on more than double average trading volume to $27.16 following a Dec. 10 announcement that it will acquire several assets in the Gulf of Mexico for $640 million.

Midstream companies and pipeline partnerships moved higher, with the Alerian MLP Index gaining 0.47% to 210.27.

Genesis Energy LP closed at $20.77, rising by 3.23% in brisk trading after the partnership agreed to provide downstream services for crude oil and natural gas from two deepwater Gulf of Mexico fields.

Other notable movers included EQM Midstream Partners LP, which added 2.04% on lower-than-average volume to $25.01. Magellan Midstream Partners LP posted a 1.98% increase in active trading to $61.75. Enterprise Products Partners LP added 1.84% on roughly double average volume to $27.67.

On the other hand, Plains All American Pipeline LP exited the session down 2.67% in active trading to $17.53.

Despite Devon Energy Corp. and Dow Inc. agreeing to a joint venture in Oklahoma's STACK play, midstream analysts and investors noted that EnLink Midstream LLC has more work to do before its equity value can more fully bounce back. Enlink's units shed 1.60% in heavy trading to $5.53.

Electric and diversified utilities closed the midweek session on the upside with the S&P 500 Utilities Sector nudging higher by 0.33% to 318.48.

NRG Energy Inc. added 1.41% in light trading to $38.92. Dominion Energy Inc. closed the midweek session with a 1.01% increase in about average trading to $80.90. Public Service Enterprise Group Inc. also noted a 1.01% rise on above-average volume to exit the day at $58.27.

PG&E Corp. and its utility unit Pacific Gas and Electric Co. reached a new agreement with additional backstop parties for the issuance of up to $12 billion in new PG&E common shares to help the companies emerge from bankruptcy by June 30, 2020. PG&E shares fell 1.46% on almost double average volume to $12.14.

American Water Works Co. Inc. stumbled by 1.19% on slightly above-average volume to $120.90. The company announced that its president and CEO, Susan Story, will retire in 2020. Story will be succeeded by COO Walter Lynch, effective April 1, 2020. The company also outlined its 10-year capital spending plan and initiated 2020 earnings guidance.

Looking at the solar sector, SunPower Corp. advanced 5.00% to $7.56 and First Solar Inc. noted a 2.67% increase to $53.87, both in light trading. Sunrun Inc. went the other way and shed 0.53% on below-average volume to settle at $13.19.

Mostly lower moves enveloped coal companies, with Alliance Resource Partners LP slipping by 1.67% on average volume to $9.99. Arch Coal Inc. saw a 0.71% decline in light trading to close at $75.42. CNX Resources Corp. ticked lower by 0.70% on less-than-average volume to settle at $7.07.

Market prices and index values are current as of the time of publication and are subject to change.