Electric utilities outpaced other energy components on Wednesday, March 14, while midstream and coal shares followed broader markets into the red territory. The Dow Jones Industrial Average lost 1.00% to close the day at 24,758.12, while the S&P 500 retreated 0.57% to settle at 2,749.48.
In a March 13 report, Moody's brightened its crude oil price outlook through 2019, citing a tightening in global oil supply amid strong demand and restraint from OPEC. The rating agency raised its forecast price for West Texas Intermediate and Brent crude oil to a band of $45.00 per barrel to $65.00/bbl, up from a range of $40.00/bbl to $60.00/bbl previously.
A trading day after the release of the report, NYMEX Light Sweet crude increased 0.41% to $60.96/bbl, and NYMEX Brent crude edged up 0.39% to $64.89/bbl.
Among oil and gas behemoths, Exxon Mobil Corp. closed down 1.25% in above-average trading to $73.60, while Chevron Corp. retreated 1.14% on weak volume to $115.13. The companies' stock prices took a hit in recent weeks but Chevron's announcement of a buyback program has helped it recover, while shares of Exxon, which has remained mum so far on a stock repurchasing plan, continue to struggle.
CNX Resources Corporation shares tumbled 4.37% in robust trading to end at $15.54. Analysts were wary of the company's capital expenditure increase due to its plans to drill the Utica and Marcellus Shales in southwest Pennsylvania using jumbo 20-well pads.
Among top gainers in the electric utility sector, Edison International rose 2.82% on brisk volume to close at $63.81, NextEra Energy Inc. saw an increase of 2.16% in active trading to finish at $158.01, and El Paso Electric Co. added 1.14% in light trading to settle at $48.90.
Southern Co. shares advanced 1.06% on light volume to finish at $44.05, after S&P Global Ratings affirmed its A- issuer credit ratings and all issue ratings on the company and some of its subsidiaries. The rating agency also raised Mississippi Power Co.'s long-term issuer credit rating to A- from BBB+ and stand-alone credit profile to bbb from bb+.
"We are upgrading [Mississippi Power] because it has resolved the operating and regulatory missteps surrounding the Kemper project," S&P Global Ratings said in a report.
The outlook for Southern Co. and its subsidiaries remains negative due to "thin financial cushion at the current ratings" and risks connected to the construction of Georgia Power's Vogtle 3 and 4 nuclear reactors.
In the midstream sector, Enterprise Products Partners LP shed 1.54% to $25.63, MPLX LP declined 1.84% to $34.71 and ONEOK Inc. receded 1.04% to $57.16, all on thin volume.
April natural gas futures were lower at midweek as market participants look beyond near-term cold to focus instead on the impending arrival of spring. The April contract traded on the New York Mercantile Exchange from $2.710/MMBtu to $2.798/MMBtu Wednesday and settled 5.5 cents lower at $2.731/MMBtu.
Market prices and index values are current as of the time of publication and are subject to change. This S&P Global Market Intelligence news article may contain information about credit ratings issued by S&P Global Ratings, a separately managed division of S&P Global. Descriptions in this news article were not prepared by S&P Global Ratings. The original S&P Global Ratings documents referred to in this news brief can be found here.
