Oil and Gas, Gold Lead Markets Higher on Friday
The International Energy Agency (IEA) released its January Oil Market Report Friday morning and cut its estimate for oil demand growth 2015 by 350,000 barrels a day, from 1.3 million barrels to 950,000 barrels. The estimated reduction has put some air under crude prices, which rose as much as 3.6% to $47.92 for West Texas Intermediate (WTI) for February delivery. Brent crude for February delivery rose nearly 4% to a high of $50.62.
Gold stocks soared as the fallout from the Swiss National Bank’s decision to end its support of the franc is pointing investors in the direction of a different safe haven. Here is a look at five stocks that saw some nice boosts Friday.
Coeur Mining Inc. (NYSE: CDE) announced its production outlook for this year on Thursday, and the company forecast gold production of 284,000 to 313,000 ounces, well above 2014 production of 249,384 ounces. Gold-equivalent silver production is forecast at 31,840 to 34,780 ounces, compared with 2014 production of 32,151 ounces. That has been enough to boost shares 3.75% on Thursday and another 5% on Friday to $5.81, in a 52-week range of $3.37 to $12.06.
Yamana Gold Inc. (NYSE: AUY) traded up nearly 5%, at $4.41 in a 52-week range of $3.45 to $10.72. Yamana said earlier this week that it had completed a secondary offering of 49.1 million shares to raise net proceeds of around $217 million. That did not help the share price, which dipped from $4.73 at Monday’s close to a low of $3.81 on Wednesday before closing at $4.21 on Thursday.
Goldcorp Inc. (NYSE: GG) is also getting a boost. Shares traded up about 4.7% Friday, at $23.77 in a 52-week range of $17.01 to $29.65. Earlier in the week, Goldcorp announced forecast 2015 gold production of 3.3 million to 3.6 million ounces, up from 2.867 million ounces of production in 2014.
Among the oil companies, Petrobras, officially Petroleo Brasileiro S.A. (NYSE: PBR), and BP PLC (NYSE: BP) posted the largest gains Friday morning. Petrobras stock has been beaten up in recent weeks on the corruption scandal that hit the company late last year and the falling price of crude. But the company’s vast reserves do become more valuable when crude prices rise.
At BP the company got some relatively good news late Thursday when a federal magistrate capped the company’s liability under the Clean Water Act for the April 2010 Macondo well explosion at $13.7 billion. The ruling set the amount of the spill at 3.19 million barrels, about 900,000 barrels below the U.S. government’s estimate, which could have led to a penalty of $17.6 billion. The not-so-good news is that the $13.7 billion is not yet included in the $42 billion that BP has already set aside or spent on other penalties, compensation and clean-up related to the disaster that killed 11 workers.