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.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


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