Natural Gas Stocks Are Leading XLE into Positive Territory



Natural gas leading the rise

For the week starting November 27, 2017, natural gas (UNG) (BOIL) prices are leading the rise in energy commodities. Natural gas prices rose from last week’s close of $2.92 per MMBtu (million British thermal units) on November 24 to $3.18 per MMBtu on November 29, an increase of more than 9% so far. Natural gas prices rose sharply on Monday and Tuesday and moved above their 50-day and 200-day moving averages, which currently stand at $3.01 and $3.03, respectively.

Crude oil, gasoline, and heating oil are falling

As of November 29, 2017, crude oil prices fell 2.8% from their last week’s close of $58.95 per barrel to $57.30 per barrel by Wednesday. Unleaded gasoline (UGA) and heating oil prices are also down significantly by 2.6% and 1.6% so far this week.

Energy stocks

With the mixed performance from natural gas and crude oil, the energy sector is up modestly. As of November 29, the Energy Select Sector SPDR Fund (XLE), which represents an index of stocks across the energy sector, rose 0.29%.

Stocks that are leading the rise in XLE are as follows:

  • Range Resources (RRC) rose 3.6%.
  • Chesapeake Energy (CHK) rose 3.3%.
  • TechnipFMC (FTI) rose 2.4%.

Range Resources (RRC) and Chesapeake Energy (CHK) are primarily natural gas producers and likely up due to strong gains in natural gas prices.

In general, for the week starting November 27, XLE is underperforming the SPDR S&P 500 ETF (SPY). As of Wednesday, SPY had risen 0.90% this week.

In this series

Having analyzed the performance of the broader energy sector in the current week, we’ll also look at the performance of the energy subsectors. Specifically, we will look at the gainers and losers from the refining and marketing and integrated energy sectors. We’ll also try to analyze any news or developments behind the moves.

Let’s now start with the refining and marketing gainers from this week.

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