ENI’s Stock Performance in 3Q17: Its 50-DMA Breaks below Its 200-DMA


Sep. 28 2017, Updated 9:08 a.m. ET

ENI’s stock performance in 3Q17

ENI (E) stock stands seventh in terms of stock price appreciation among the top ten integrated energy stocks. ENI stock marks the beginning of our bottom tier in this review. The other stocks in the bottom tier are BP (BP), PetroChina (PTR), and ExxonMobil (XOM). Now, let’s have a look at ENI’s stock performance.

ENI stock has risen 7.4% since July 3, outperforming the broad market indicator, the SPDR S&P 500 ETF (SPY). This ETF has risen 3.3% in the same period.

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ENI’s moving averages

In 3Q17, ENI’s 50-day moving average (or 50-DMA) has broken below its 200-day moving average (or 200-DMA). This is a negative technical indicator. ENI’s 50-DMA stood 3.0% above its 200-DMA on July 3. As ENI stock declined toward the end of 2Q17, its 50-DMA broke below its 200-DMA in the current quarter.

However, its 50-DMA has now started rising. ENI’s 50-DMA stands just 0.5% below its 200-DMA. In such a situation, if oil prices rise or if a positive event occurs, then ENI’s 50-DMA could cross over its 200-DMA, pulling ENI stock out of the bearish zone.

Why the rise in ENI stock in 3Q17?

ENI stock’s correlation coefficient versus WTI for the past one-year period stood at 0.45, implying a positive correlation. WTI prices rose 8.4% in 3Q17.

In the current quarter, ENI announced its 1H17 earnings. In the first half of 2017, ENI’s earnings turned positive compared to its negative earnings in 1H16. This was due to an across-the-board rise in its segmental earnings.

In 3Q17, ENI signed an agreement with China National Petroleum Corporation for cooperation in the upstream, downstream, logistics, and LNG value chains in China and overseas.

In the next part, we’ll look at BP’s (BP) 3Q17 stock returns.


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