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Tuesday's Energy Stocks: Wall Street recovers, MLPs lead sectorwide rally

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Essential Energy Insights - November 2021


Tuesday's Energy Stocks: Wall Street recovers, MLPs lead sectorwide rally

Broader markets rose sharply on Tuesday, Oct. 16, as third-quarter earnings season begins. The Dow Jones Industrial Average was up 2.17% to end at 25,798.42, and the S&P 500 rose 2.15% to finish at 2,809.92.

Energy equities also saw a sectorwide rally, led by master limited partnerships.

Tallgrass Energy LP finished 4.26% higher on light volume to $24.73. The partnership and Silver Creek Midstream LLC are expanding their crude oil midstream joint venture in the Powder River Basin to add takeaway capacity to the Guernsey, Wyo., oil hub. Tallgrass Energy also raised its dividend for the third quarter to 51 cents per share, up 1.25 cents, or 2.5%, from the previous quarter.

Among other MLPs, Spectra Energy Partners LP climbed 3.40% in light trading to $37.08, Magellan Midstream Partners LP rose 2.22% on light volume to $65.36, and MPLX LP advanced 2.10% on average volume to $35.53.

The Alerian MLP Index rose 2.02% to 276.19.

Equinor settled 1.18% higher on below-average volume to $27.38, after announcing that it has started production at the Oseberg Vestflanken 2 field in the North Sea using the first unmanned, remote-operated wellhead platform on the Norwegian Continental Shelf. In addition, the company also noted that the project was delivered below budget at 6.5 billion Norwegian kroner.

Gibson Energy Inc. spiked 9.30% on brisk volume on the Toronto Stock Exchange to close at C$22.79, after unveiling plans to expand the tankage at its Hardisty oil storage terminal by 1 million barrels. The expansion is supported by a long-term agreement with an oil sands customer, the company said.

Devon Energy Corp. advanced 2.69% in active trading to end at $37.08, after lowering its third-quarter 2018 net production estimate for Canada due to maintenance activities at one of its heavy oil projects, while raising its estimate for U.S. net production as a result of higher NGL recoveries. Devon also kept its spending below its guidance range in the third quarter at $523 million.

Range Resources Corp. slid 0.62% on average volume to finish at $17.54. Analysts liked the company's $300 million sale of a 1% royalty interest in the bulk of its gas production for its ability to help Range pay down debt but pushed for more sales. Range retains 82% of the revenue from those wells.

The S&P 500 Energy Sector advanced 0.87% to 540.77.

Fortis Inc. President and CEO Barry Perry said in an investor day conference call that the company would earn about C$150 million more annually if its Canadian utilities were situated in the U.S. The company closed the trading day 1.75% higher on strong volume on the Toronto Stock Exchange to C$41.86.

Dominion Energy Inc. picked up 0.96% in weak trading to settle at $72.30, after requesting for a second renewal of the operating licenses of its 1,750-MW Surry nuclear plant in Virginia to keep the reactors online beyond 2050.

Among other electric and diversified utilities, AES Corp. climbed 3.50% on heavy volume to finish at $15.36; NRG Energy Inc. climbed 2.92% higher on below-average volume to finish at $37.67; and SCANA Corp. added 2.63% in light trading to end at $39.78.

The S&P 500 Utilities Sector gained 1.16% to settle at 272.89.

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