Energy Sector Update for 07/20/2020: DNR,NBL,CVX,MTZ
Energy stocks were drifting lower this afternoon, with the NYSE Energy Sector Index falling 0.6% while the SPDR Energy Select Sector ETF was down 0.7%.
Front-month West Texas Intermediate crude oil was up 23 cents to $40.82 per barrel at the New York Mercantile Exchange while the global benchmark Brent crude contract was adding 19 cents to $43.33 per barrel. Natural gas futures were 8 cents lower at $1.64 per 1 million BTU.
Among energy-related ETFs, the United States Oil Fund was ahead 0.2% while the United States Natural Gas fund was sliding 4.6%. The Philadelphia Oil Service Sector index was posting a 1.5%.
In company news, Denbury Resources (DNR) still was 11% higher, easing from a nearly 41% spike soon after Monday's opening bell that followed the energy company refuting an early-morning news release stating it had accepted a $1.20-per-share acquisition offer from an unnamed suitor. "The company has received no such proposal," Denbury said in a statement just ahead of Monday's starting bell, adding it reported the "fraudulent activity" to the New York Stock Exchange.
Noble Energy (NBL) climbed 5.3% after agreeing to a $5 billion all-stock buyout offer from Chevron (CVX), which said the deal will bolster its upstream portfolio. Under the terms of the proposed transaction, investors would receive 0.1191 of a Chevron share for each Noble Energy share, valuing the target company a $10.38 a share, or about 7.6% above Friday's closing price. Chevron shares were 2% lower Monday afternoon.
MasTec (MTZ) slipped 3.4% on Monday after announcing plans for a $400 million private placement of senior unsecured notes due 2028, subject to market and other conditions. The infrastructure construction firm expects to use the net proceeds to redeem all $400 million of its outstanding 4.875% senior Notes maturing in 2023, although MasTec also said it may also use the proceeds to temporarily pay down a portion of its revolving credit facility before re-borrowing that amount to fund the proposed note redemption.
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