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Friday's Energy Stocks: Utilities rise as broad indexes settle

Electric utility and natural gas stocks recorded gains Friday, Dec. 16, while broader indexes finished the trading day relatively flat. The SNL Energy Index rose 1.18% to 279.03, the Dow Jones Industrial Average dropped 0.04% to 19,843.41 and the S&P 500 fell 0.18% to 2,258.07.

Among utilities, the biggest gains were seen by Public Service Enterprise Group Inc., up 2.42% to $43.99 on more than double average trading volume, and Edison International, up 2.18% to $71.72, also on more than double average trading volume. American Electric Power Co. Inc. shares increased by 1.13% to settle at $62.81.

AEP subsidiary AEP Ohio, known legally as Ohio Power Co., issued requests for proposals Dec. 16 for up to 250 MW of wind capacity and up to 100 MW of solar power, for new projects in Ohio that can start commercial operation by the end of 2018. Certain preferences will be given for elements of the solar projects.

In Virginia, investor-owned utilities and clean energy advocates reached agreement on four legislative proposals that could increase solar power installations while boosting the profit potential for solar developers and utilities. Dominion Resources Inc. utility Dominion Virginia Power and AEP's Virginia utility, Appalachian Power Co., along with electric cooperatives in the state and solar advocate MDV-SEIA, are part of a diverse group of stakeholders that has been meeting since spring on potential policy changes for renewable energy.

Dominion shares gained 1.74% to $75.87, on heavy volume.

SunPower Corp. picked up 4.92% to $7.46 on below-average volume amid news that trustees for a pension fund are suing the company for allegedly concealing the financial problems it has faced in recent months. The complaint, which was filed in U.S. District Court for the Northern District of California on Dec. 14, focused on an August announcement that the solar panel manufacturer and power plant developer planned to cut 15% of its workforce and shut a panel facility in the Philippines in response to declining prices for power purchase agreements and a shift in customer timelines after Congress extended the investment tax credit in December 2015. As a result, the company said it expected to incur up to $45 million in restructuring charges. It also lowered its 2016 earnings guidance and forecast a loss next year.

The SNL Merchant Generator Index increased 0.81% and settled at 80.52. NRG Energy Inc., dropped 2.23% to $12.30 on more than triple average volume, while Pattern Energy Group Inc. sank 1.86% to $19.49 in above-average trading.

Pattern rolled out a new limited partnership financing vehicle dubbed Pattern Energy Group 2 LP that it hopes will help expand its access to capital to fuel its development pipeline.

The SNL Midstream Energy Index rose 1.31% to 118.37. Midstream majors Kinder Morgan Inc. and Phillips 66 Partners LP both showed growth, with Kinder Morgan up 1.52% to $21.34 and Phillips 66 Partners up 2.38% to $46.48, both in heavy trading.

FERC greenlighted Kinder Morgan and Southern Co.'s gas pipeline joint venture to put in service a compressor that was moved to Liberty County, Ga., as the developers bring online a pipeline expansion that will serve the Elba Island LNG export terminal.

Meanwhile, Phillips 66 Co. placed its Freeport LPG export terminal in full service, fulfilling part of its initiative to respond to growing international demand for U.S. NGLs. It shipped its first contracted cargo, from Phillips 66 Partners, on the same day. Phillips 66 stock gained 1.03% to $87.46.

Despite a good showing the day before, the SNL Coal Index declined on Dec. 16 by 1.14% to 80.51. CONSOL Energy Inc. fell 1.13% to $19.21, while Cloud Peak Energy Inc. dropped 1.35% to $5.84. Meanwhile, CNX Coal Resources LP shot up 2.62% to $17.60.

CNX Coal Resources will have to "wait for its lump of coal" until 2018, according to a recent company update from FBR & Co. Analyst Lucas Pipes, who maintained an "outperform" rating for CNX Coal. The CEO of CONSOL Energy, the sponsor of CNX Coal, said recently that the parent company hopes to complete splitting its gas and coal assets sometime in 2017.

January 2017 natural gas futures dipped slightly, finishing the day down 1.9 cents to $3.415/MMBtu.

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