Markets: News  

Exxon weighs on Dow as energy stocks retreat

NEW YORK (MarketWatch) -- Energy stocks fell into the red on Monday, as Exxon Mobil Corp. ranked as one of the worst performers among the 30 stocks in the Dow Jones Industrial Average.

The downward moves came despite gains in some energy producers after bullish comments from Goldman Sachs and a deal by NiSource Inc. to build up its infrastructure and production from the Utica shale of Ohio and Pennsylvania.

Exxon Mobil Corp. (XOM) dropped 1.4% and Chevron Corp.(CVX) declined 0.6%. The two oil majors ranked among the weaker stocks in the Dow Jones Industrial Average (DJIA) , which fell 36 points, or 0.3%, at the closing bell.

The Energy Select Sector SPRD Fund (XLE) , which tracks energy stocks in the S&P 500 (SPX) , dropped down by 0.5%.

Leading the way into the red for energy stocks in the S&P 500, coal producers Alpha Natural Resources(ANR) dropped 7.5% and Peabody Energy Corp. (BTU) moved down by 6.2%. WPX Energy(WPX) fell 4% and First Solar Inc. (FSLR) dipped 3.1%.

Checking the main benchmarks in the energy sector, the NYSE Arca Oil Index (XOI) fell 0.5% and the NYSE Arca Natural Gas Index (XNG) ended about flat. The Philadelphia Oil Service Index (OSX) rose 0.4%, boosted by a gain of 2.3% by Oceaneering International(OII) .

Among stocks in the spotlight, Statoil ASA(STO) plans to move ahead with a one-to-four-day process to shut off up to 1.2 million barrels of oil production a day from the Norwegian continental shelf because of a labor strike, spokesman Bard Glad Pedersen told MarketWatch on Monday. The action has been planned for midnight, local time.

"We are preparing to start the shutdown process," Pedersen said. "The conflict has not been resolved." Statoil and the Norwegian Oil Industry Association held talks over the weekend about their contract dispute but so far no agreement has been reached.

Among analyst actions, Goldman Sachs upgraded Cabot Oil & Gas(COG) to buy from neutral and said a pullback in shares of domestic oil producing firms appears to be overdone.

Analysts reiterated their attractive rating on U.S. oil and gas producers and stuck to their conviction list buy ratings for EOG Resources Inc. (EOG) , Pioneer Natural Resources (PXD) and Noble Energy Inc. (NBL) .

"We see higher gas prices in 2013-2018; we still see efficiency gains and exploration potential in North American shale and global deepwater; and we see continued asset and corporate merger and acquisition potential," analysts said.

Shares of Cabot rose 1.9% as one of the top gainers in the S&P 500.

NiSource Inc. (NI) and private oil and gas company Hilcorp Energy Co. said Monday they're launching a "major" venture in the Utica shale of Pennsylvania and Ohio, beginning with a first-phase investment of $300 million later this year.

The companies will team up on a new gathering pipeline and natural gas liquids processing operation, as well as developing hydrocarbon potential in the Utica/Point Pleasant shale formation in northeastern Ohio and western Pennsylvania.

Shares of NiSource fell 1.3%.