While the stock market is having a pretty good 2013 so far, there’s one group that’s missing out on the the gains: oil and gas producers.
Cabot Oil & Gas (COG) is the biggest decliner on the Standard & Poor’s 500 index, falling more than 3% so far today. Also down are are shares of Consol Energy (CNX), EQT Corp. (EQT), both down about 3%, and another energy stock, coal miner�Peabody Energy�(BTU), which has lost 2.5%.*
The reason for this broad move seems to be the sharp drop in natural gas futures prices, which are down 4.5% today. As Alison Sider writes for Dow Jones Newswires today:
As investors for the moment are spooked by the prospect of a warmer-than-expected winter, “my sense is when natural gas took its run late last year, it was driven by hopes of a really cold winter” and not fundamentals, says Argus’ Phil Weiss.
In particular, according to Bloomberg, it was a research report that’s triggered the latest fears.
Gas dropped as much as 9 percent after Commodity Weather Group LLC in Bethesda,�Maryland, said colder-than-average weather in most of the lower-48 states this week would give way to above-normal temperatures from Jan. 7 through Jan. 11. The low in New York on Jan. 9 may be 38 degrees Fahrenheit (3 Celsius), 11 higher than usual, according to�AccuWeather Inc.
*Update: As noted in the comments, this post originally seemed to suggest that Peabody is also a gas producer; it’s not, and I’ve clarified the fact.
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