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by Stockwatch Business Reporter
West Texas Intermediate crude for January delivery added 24 cents to $58.01 on the New York Merc, while Brent for January added 26 cents to $63.65 (all figures in this para U.S.). Western Canadian Select traded at a discount of $19.15 to WTI, unchanged. Natural gas for December plunged 13 cents to $2.53. The TSX energy index added 1.41 points to close at 134.25.
U.S.-focused shale producer EnCana Corp. (ECA) edged up four cents to $5.48 on 8.47 million shares. The stock got a less than enthusiastic mention this morning from Scotia Capital analyst Jason Bouvier, who downgraded his rating to "sector perform" from "outperform" and lowered his price target to $5.50 (U.S.) from $7 (U.S.). (The stock closed today in New York at $4.12 (U.S.).) Mr. Bouvier sees near-term risk involved with EnCana's proposed redomiciling to the United States. The proposal was announced in late October and has already caused some consternation among Canadian investors. Just last week, the Montreal-based Letko, Brosseau & Associates Inc., which owns about 4 per cent of EnCana's shares -- making it a top five shareholder -- vowed to vote against the proposal, pointing out that the redomiciling will surely get EnCana kicked out of the S&P/TSX indexes. This will force index-linked investors to sell (likely at a steep loss) and will put additional selling pressure on a stock that has already lost about two-thirds of its value since September of last year. EnCana countered that most investors will be unaffected by the move and will in fact benefit from exposure to larger pools of U.S. capital.
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