Stocks gave back a bit of last week’s Brexit-inspired gains as the yield on the U.S. 10-year Treasury hit a record low.
The S&P 500 fell 0.7% to 2,088.55 today, while the Dow Jones Industrial Average declined 108.75 points, or 0.6%, to 17,840.62. The Nasdaq Composite dropped 0.8% to 4,822.90.
Strategas Research Partners’ Chris Verrone and Todd Sohn observe that the post-Brexit world looks a lot like the pre-Brexit world:
As we have highlighted over the last week, many of the dominant trends in place pre-Brexit remain in place post-Brexit. Perhaps the most notable example of this is the continued strength in bonds, with the U.S. 10-year yield at a record low today. The bull flattener has also continued with 2/10s hitting a 9-year low this morning at roughly 82 basis points. As global yields have moved lower and curves have flattened, the bid for Consumer Staples and Utilities remains firm. Nearly 50% of the stocks in the S&P Consumer Staples sector hit a 52-week high last week, and while sharp expansions in the new high data can be short-term climactic, it is rarely a bearish development over the longer-term.
Top Integrated Utility Stocks To Own For 2017: ConocoPhillips(COP)
ConocoPhillips operates as an integrated energy company worldwide. The company?s Exploration and Production (E&P) segment explores for, produces, transports, and markets crude oil, bitumen, natural gas, liquefied natural gas, and natural gas liquids. Its Midstream segment gathers, processes, and markets natural gas; and fractionates and markets natural gas liquids in the United States and Trinidad. The company?s Refining and Marketing (R&M) segment purchases, refines, markets, and transports crude oil and petroleum products, such as gasolines, distillates, and aviation fuels. Its Chemicals segment manufactures and markets petrochemicals and plastics. This segment offers olefins and polyolefins, including ethylene, propylene, and other olefin products; aromatics products, such as benzene, styrene, paraxylene, and cyclohexane, as well as polystyrene and styrene-butadiene copolymers; and various specialty chemical products comprising organosulfur chemicals, solvents, catalyst s, drilling chemicals, mining chemicals, and engineering plastics and compounds. The company?s Emerging Businesses segment develops new technologies and businesses. It focuses on power generation; and technologies related to conventional and nonconventional hydrocarbon recovery, refining, alternative energy, biofuels, and the environment. This segment also offers E-Gas, a gasification technology producing high-value synthetic gas. ConocoPhillips was founded in 1917 and is based in Houston, Texas.
- [By Lisa Levin]
Benzinga's newsdesk monitors options activity to notice unusual patterns. These large volume (and often out of the money) trades were initially published intraday in Benzinga Professional . These trades were placed during Monday's regular session.
Navistar International Corp (NYSE: NAV) Jun16 10.0 Puts Sweep: 902 @ ASK $0.35: 15k traded vs 1749 OI: Earnings Today Before Open $12.22 Ref ConocoPhillips (NYSE: COP) Fri 6/10 44.5 Puts (Wkly): 2000 @ ASK $0.43: 4051 traded vs 80 OI: $44.87 Ref SeaWorld Entertainment Inc (NYSE: SEAS) Sep16 17.0 Puts Sweep: 683 @ ASK $1.40: 2749 traded vs 313 OI: $16.52 Ref
Posted-In: put optionsNews Options Markets
- [By Joshua Bondy]
The big dog
ConocoPhillips (NYSE: COP ) spun off Philips 66, becoming the largest independent E&P. In the long run, its size may hold the company back. Its latest quarterly operating income of $14.78 per Boe is respectable for such a large firm, but it is beingforced into expensive unconventional plays. The company’s own rough estimates project that its base production will fall from 1.5 million barrels of oil equivalent per day (Mmboepd) to 1.0 Mmboepd by 2017.
- [By Ben Levisohn]
Unlike ConocoPhillips (COP), Hess’s (HES) dividend wasn’t big enough to move the needle if cut. So it’s selling stock instead:
Hess has priced the concurrent offering of ~28.8mm shares of common stock and ~11.5mm depositary shares, assuming the over-allotment options are exercised. The depositary shares represent a 1/20th interest in each share of Hess 8% Mandatory Convertible Preferred Stock, which unless converted earlier at the option of the holder will convert on or around February 1st, 2019 into Hess common shares. Based on the equity offering price of $39/share, we estimate total net proceeds of ~$1.65bn net common offering proceeds of $1.09bn and net depositary share offering proceeds of ~$558mm. The offerings represent ~10% of Hess prior outstanding share count and ~15% on fully diluted basis including the conversion of the convertible preferred shares.
Hess said it will use the proceeds from the offerings for general corporate purposes and to strengthen its balance sheet. Prior to the offering, Hess already had one of the strongest balance sheets within our E&P coverage group with a net debt/capitalization ratio of ~14% at YE15 and more than ~$2.7bn of cash on its balance sheet. However, based on current NYMEX strip prices and after dividends, Hess was confronting a ~$2.0bn cash flow outspend this year and another ~$2.3bn in 2017. Mgmt. emphasized that it has no intention to cut the companys dividend.
Mgmt. emphasized that the offerings were not intended to pre-fund any M&A activity or to accelerate drilling activity.
Shares of Hess have tumbled 11% to $38.89 at 1:26 p.m. today, while the Energy Select Sector SPDR ETF (XLE) has fallen 2.2% to $56.
- [By Matt Egan]
It’s rocking your retirement account: The Dow has plummeted 1,800 points so far this year and CNNMoney’s Fear & Greed Index is flashing “extreme fear.” You’re not going to be happy when you open your 401(k) statement. The freakout on Wall Street has been largely driven by the crash in oil. It’s caused energy profits to plunge and slammed stocks like Chevron (CVX) and ConocoPhillips (COP).
Top Integrated Utility Stocks To Own For 2017: Genie Energy Ltd.(GNE)
Genie Energy Ltd., through its subsidiaries, operates as a retail energy provider and a developer of an oil and gas exploration company. The company operates through three segments: Genie Retail Energy; Afek Oil and Gas, Ltd.; and Genie Oil and Gas. It resells electricity and natural gas to residential and small business customers primarily in the Mid-Atlantic and Midwestern United States. The company also has 86.5% in the southern portion of the Golan Heights in Northern Israel; has 88.4% interest in an oil shale exploration project in Central Mongolia; holds and manages a 41.3% interest in an oil shale development project in Colorado; and has an 86.1% interest in an oil shale development project in Israel. Genie Energy Ltd. was incorporated in 2001 and is headquartered in Newark, New Jersey.
- [By Lisa Levin]
In trading on Tuesday, utilities shares fell by 0.58 percent. Meanwhile, top losers in the sector included Middlesex Water Company (NASDAQ: MSEX), down 2 percent, and Genie Energy Ltd (NYSE: GNE), down 4 percent.
- [By Lisa Levin]
In trading on Thursday, utilities shares fell by 0.75 percent. Meanwhile, top losers in the sector included Genie Energy Ltd (NYSE: GNE), down 5 percent, and Consolidated Water Co. Ltd. (NASDAQ: CWCO), down 2 percent.
Top 10 Undervalued Stocks To Own Right Now: CSX Corporation(CSX)
CSX Corporation, together with its subsidiaries, incorporated on November 15, 1978, is a transportation company. The Company provides rail-based transportation services, including rail service and the transport of intermodal containers and trailers. The Company serves approximately three lines of business, such as merchandise business, coal business and intermodal business. The Company’s operating subsidiary, CSX Transportation, Inc. (CSXT), provides a link to the transportation supply chain through its approximately 21,000-route mile rail network, which serves population centers in approximately 20 states east of the Mississippi River, the District of Columbia and the Canadian provinces of Ontario and Quebec. It has access to over 70 ocean, river and lake port terminals along the Atlantic and Gulf Coasts, the Mississippi River, the Great Lakes and the St. Lawrence Seaway. The Company’s intermodal business links customers to railroads through trucks and terminals. CSXT als o serves production and distribution facilities through track connections to approximately 240 short-line and regional railroads.
The Company’s merchandise business consists of shipments in the diverse markets, such as agricultural products, phosphates and fertilizers, food and consumer, chemicals, automotive, metals, forest products, minerals, and waste and equipment. The Company’s coal business transports domestic coal, coke and iron ore to electricity-generating power plants, steel manufacturers and industrial plants, as well as exports coal to deep-water port facilities. The Company’s intermodal business combines the rail transportation with the short-haul flexibility of trucks and offers long-haul trucking. The Company’s intermodal business serves all markets, which are located in east of the Mississippi River, and transports manufactured consumer goods in containers. The Company provides customers with truck-like service for longer shipments.
In addition to CSXT, the Company’s subsidiaries include CSX ! Intermodal Terminals, Inc. (CSX Intermodal Terminals), Total Distribution Services, Inc. (TDSI), Transflo Terminal Services, Inc. (Transflo), CSX Technology, Inc. (CSX Technology) and other subsidiaries. CSX Intermodal Terminals owns and operates a system of intermodal terminals, predominantly in the eastern United States, and also performs drayage services (the pickup and delivery of intermodal shipments) for certain customers and trucking dispatch operations. TDSI serves the automotive industry with distribution centers and storage locations. Transflo transfers products from rail to trucks. The Transflo markets are chemicals and agriculture, which include shipments of plastics and ethanol. CSX Technology and other subsidiaries provide support services for the Company. CSX’s other holdings include CSX Real Property, Inc., a subsidiary responsible for the Company’s operating and non-operating real estate sales, leasing, acquisition, and management and development activities.
The Company competes with Norfolk Southern Railway.
- [By Monica Gerson]
CSX Corporation (NASDAQ: CSX) reported in-line earnings for its first quarter, but the company missed analysts’ sales estimates. CSX shares gained 0.44 percent to $25.10 in after-hours trading.