Energy stocks fell on January 12 despite stronger oil prices. After rebounding on January 11, the S&P 500 Energy sector resumed its fall on Thursday—it fell 0.48%. Hess (HES) and Cimarex Energy (XEC) were the biggest losers in the energy sector.
Hess, a global independent energy company that explores oil, gas, and energy solutions, fell 4.8% on January 12. On Thursday, Hess announced its E&P capital and exploration budget. According to the announcement, the budget is $2.25 billion for production and exploration in 2017. It’s higher than the budget of $1.9 billion in 2016. The production forecast and capex target was below the market’s estimates and dented the sentiment. The market was expecting capital spending of $2.4 billion.
The disclosure of charges of more than $4.6 billion in 4Q16 dragged prices down on Thursday. The market was expecting the 2017 production forecast to be at 320,000 barrels of oil equivalent per day, but the company released the forecast of 300,000–310,000 barrels of oil equivalent per day.
After falling to almost one-month low price levels, the telecom services sector rebounded on Thursday and supported the market. On January 12, the S&P 500 Telecom Services sector rose 0.63%. Finisar (FNSR) and Oclaro (OCLR) were the top gainers in the telecom services sector. Finisar, a manufacturer of optical communication components and subsystems, rose 4.0% on January 12. Positive sentiment in the industry and strong earnings estimates from analysts kept the stock higher. On Thursday, Finisar rose because many analyst firms upgraded the stock and revised its 12-month price target.