May 19 Was a Bad Day for the Worst Performing Energy Companies



Contango Oil & Gas and Transocean are among the worst

Contango Oil & Gas Company (MCF) and Transocean Ltd (RIG) posted the lowest one-day returns on May 19, 2015. Returns that day were -11.54% and -5.86%, respectively, on the SPDR S&P Oil & Gas Exploration & Production ETF (XOP) and the Energy Select Sector SPDR (XLE).

Diamond Offshore Drilling (DO) also posted a loss on May 19, coming in at -4.99%. As you can see in the above chart, the energy indexes also posted losses that day.

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More institutional investors continue to lower their exposure to the energy sector

According to aggregate 13F data, aggregate shares held in Transocean on March 31 fell by 9.35%, compared to the previous quarter. More funds decreased or closed their positions in energy companies such as Transocean and Contango Oil & Gas rather than increase or initiate a new stake. For instance, Norges Bank sold all its 6,470,858 shares in Transocean and 263,803 shares in Contango Oil & Gas.

State Street Corporation lowered its holdings in Transocean by 4,217,067 shares. Shroder Investment Management Group lowered its holdings in Contango Oil & Gas by 303,756 shares. This signals a weak outlook for energy companies such as EOG Resources (EOG) that will likely hold back capital expenditures on new projects until oil prices continue to experience a sustained increase.

In the next part of this series, we’ll look at recent investment trends in oil-based ETFs.


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