Natural gas stocks saw a notable decline Monday, following the National Weather Service's announcement of a milder-than-average weather forecast for December in the Midwest.
The forecast weather conditions are associated with an upper-level jet stream pattern, which is expected to prevent the movement of extremely cold air masses into the region. This pattern is often observed during strong El Niño events, such as the one we are currently experiencing.
The Climate Prediction Center has identified a 70 to 80 percent chance that the average December temperature will exceed the norm in the region. This warmer forecast has had a direct impact on natural gas prices, consequently affecting stocks related to this commodity.
The First Trust Natural Gas ETF saw its value decrease by 2.3%. This decline was led by significant losses in individual natural gas stocks, including Comstock Resources which fell 4.7%, Kosmos Energy with a decline of 4.3%, SM Energy down 3.9%, and CNX Resources down 3.4%.
Additionally, some of the worst-performing stocks within the S&P 500 index were those exposed to natural gas prices.
Targa Resources saw a 4.7% reduction, Williams Companies fell 3.2%, and Oneok (NYSE:) suffered a 2.9% fall on Monday. These movements in the stock market reflect the immediate impact of the anticipated change in weather conditions on the natural gas industry.
This article was generated and translated with the help of AI and reviewed by an editor. For more information, see our T&Cs.
Related News :