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Friday's Energy Stocks: Midstream, MLPs outperform sector, broader markets

Midstream companies and master limited partnerships outpaced other energy indices and broader markets on Friday, Jan. 4, as the Alerian MLP Index rose 4.90% to settle at 238.96.

Wall Street rallied following a strong jobs report showing that total nonfarm payroll employment grew 312,000 in December 2018, beating the Econoday consensus estimate of 180,000 job gains.

The Dow Jones Industrial Average was up 3.29% to close at 23,433.16, and the S&P 500 advanced 3.43% to end the day at 2,531.94.

Shares of American Midstream Partners LP soared 26.98% on more than 4x average volume to $4.00, after an affiliate of ArcLight Energy Partners Fund V put in a new bid to buy the debt-laden midstream energy partnership.

Under the revised nonbinding proposal, ArcLight would buy all of the American Midstream common units that it and its partners do not already own for $4.50 per unit.

Williams Cos. Inc. advanced 4.16% in below-average trading to settle at $23.55, after receiving approval from the Federal Energy Regulatory Commission to begin full service on the 475,000-Dth/d Gulf Connector pipeline expansion project designed to feed natural gas to two LNG export terminals on the Texas coast.

S&P Global Ratings reduced its price assumptions for U.S. and global crude benchmarks through 2020, believing that the recent downward pressure on oil prices will not be going away anytime soon amid strong production figures.

Among top-performing oil and gas companies during the day, Noble Energy Inc. jumped 7.99% to finish at $20.68; Hess Corp. rose 7.78% to conclude at $45.69; and Marathon Oil Corp. added 5.40% to end at $15.41, all on brisk volume.

South Jersey Industries Inc.'s stock price edged up 2.52% on below-average volume to close at $27.70. The company closed the sale of a portion of its portfolio of solar energy assets to an entity managed by Goldman Sachs Asset Management LP for about $65.5 million in cash.

The S&P 500 Energy Sector gained 3.58% to close at 443.41.

Electric and diversified utilities also posted gains as the S&P 500 Utilities Sector increased 1.48% to 267.99.

Fitch Ratings assigned a first-time long-term issuer default rating of BBB+ and a senior unsecured debt instrument rating of A- to Montana-Dakota Utilities Co., following completion of MDU Resources Group Inc.'s holding company reorganization. The rating agency also affirmed MDU Resources' long-term IDR at BBB+ and downgraded its senior unsecured debt rating to BBB+ from A- to reflect Fitch's standard corporate notching policy.

MDU Resources closed the day 1.29% higher in active trading to finish at $24.26.

Merchant generators did particularly well on the day, with Pattern Energy Group Inc. up 4.89% to $19.52; Vistra Energy Corp. up 4.06% to $23.07; and NRG Energy Inc. up 3.42% to $39.04.

The Connecticut Public Utilities Regulatory Authority denied the request of SJW Group and Connecticut Water Service Inc. to extend the time to demonstrate that the acquisition of Connecticut Water by SJW is in the public's interest.

SJW climbed 3.23% in average trading to close at $56.83, while Connecticut Water shed 4.73% in robust trading to end at $65.32. In early after-hours trading on Jan. 4, the companies reversed course, with SJW declining and Connecticut Water gaining.

PG&E Corp. saw a 1.88% increase on below-average volume to settle at $24.40. Facing the potential of steeply rising wildfire liabilities, PG&E Corp. is considering selling off its gas utility business in the spring, National Public Radio reported Jan. 4, citing current and former PG&E officials speaking anonymously. The company's board also pledged a "refreshment" process that could include adding new members.

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