Natural Gas, Crude Oil, and Energy Equities Outperform the S&P 500
Natural gas leading the rise
This week, natural gas (UNG) prices are leading the rise in energy commodities. Natural gas prices rose from last week’s close of $2.98 per MMBtu (million British thermal units) on November 3 to $3.15 per MMBtu on November 7—a rise of almost 6% so far. Natural gas prices rose strongly on Monday and rose above their 200-day moving average, which currently stands at $3.03. Another energy commodity following natural gas on the upside is crude oil (USO). As of November 7, crude oil prices also rose strongly by 2.80% or from last week’s close of $55.64 per barrel to $57.20 per barrel by Tuesday. Heating oil (UHN) and unleaded gasoline (UGA) are also trading higher this week with gains of 1.22% and 1.87%, respectively.
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With the robust performance of natural gas and crude oil, the energy sector is also rising strongly this week. As of November 7, the Energy Select Sector SPDR Fund (XLE)—which represents an index of stocks across the energy sector—rose 2.15%.
Stocks leading the rise in XLE are Chesapeake Energy (CHK), Pioneer Natural Resources (PXD), Newfield Exploration (NFX), Baker Hughes (BHGE), and Helmerich and Payne (HP). These stocks are up 11.76%, 7.57%, 7.18%, 7.12%, and 6.47%, respectively, this week.
Chesapeake Energy (CHK) is mainly a natural gas producer, and it’s likely up due to the strong gain in natural gas (BOIL)(UGAZ)(DGAZ) prices this week. The only falling stock in XLE this week is Cabot Oil & Gas (COG), which is down 1.38%.
In general this week, XLE is hugely outperforming the SPDR S&P500 ETF (SPY). As of Tuesday, SPY had risen 0.09% this week.
In this series…
Having analyzed the performance of the broader energy sector this week, we’ll also look at the performance of energy subsectors. Specifically, we’ll look at the gainers and losers from the upstream and oilfield services. We’ll also analyze any news or developments behind the moves.
Let’s start with upstream gainers this week in the next part of this series.