Stock Market Update: U.S. stock market opened slightly lower, following the news that the price of oil fell nearly 5 percent. Energy shares declined in the early trade. Health care stocks also dropped down.
U.S. crude futures were down $2.81 at $50.24 a barrel.
“Just looking at the overall picture, there is no shortage of oil anywhere,” said Sal Umek at the Energy Administration Institute in New York.
“It is bearish straight across the board.”
Since prices dropped down by 60 percent between June and January, traders have wrestled with whether the dramatic price fall down would be enough to slow fast-growing U.S. shale output or whether oil still had further to fall.
A recent rebound in oil prices came to an end as the benchmark contract for U.S. crude dropped down $2.51, or 4.7 percent, to $50.54. One factor approaching oil lower was a report Wednesday that U.S. crude inventories leaped 6.3 million barrels last week, more than analysts were anticipating. Crude prices had rallied 19 percent over the earlier four days as producers canceled exploration projects and cut the number of rigs drilling.
Hot Basic Materials Stock: Lucas Energy, Inc. (NYSEMKT:LEI), skyrocketed 49.64%, and is now at $0.10, in its afternoon trade.
Reason: Victory Energy Corporation (VYEY), a rapidly growing Permian Basin focused oil and gas company, and Lucas Energy, Inc. (NYSE MKT: LEI), an asset rich Austin Chalk and Eagle Ford focused oil and gas company, declared that they have executed a Letter of Intent and Term Sheet for a projected business combination between the two companies. The business combination is conditional on the signing of a definitive merger contract, which will contain customary terms and conditions. The parties expect that the business combination will involve the issuance of equity by Lucas to Victory’s shareholders with no cash payment being made. The parties also expect that upon conclusion of the business combination, the shareholders of Victory and Victory’s partner Navitus Energy Group will own more than a majority of outstanding Lucas shares.
Lucas Energy, Inc. (NYSEMKT:LEI), operates as an independent oil and gas company in Texas. It is engaged in the attainment and development of crude oil and natural gas from various formations, counting the Austin Chalk, Eagle Ford, and Buda formations located primarily in Gonzales, Wilson, Karnes, and Atascosa counties south of the city of San Antonio; and the Eaglebine, Buda, and Glen Rose formations located in Leon and Madison counties north of the city of Houston, Texas.
During afternoon trade, following basic material stocks also gained:
Coeur Mining, Inc. (NYSE:CDE), inclined 5.65%, and is now trading at $6.92, gaining volume of $2,494,295, as compared to average volume of $3,640,320. The company has the market capitalization of $715.87M.
Coeur Mining, Inc. (NYSE:CDE), formerly declared fourth quarter production of 4.3 million ounces of silver and 64,534 ounces of gold, or 8.2 million silver-equivalent ounces. Full-year 2014 production was 17.2 million silver ounces, in-line with Company guidance of 17.0 - 18.0 million ounces, and 249,384 gold ounces, above Company guidance of 229,000 - 244,000 ounces. Full-year silver-equivalent production totaled 32.2 million ounces, which was at the high-end of Company guidance of 30.7 - 32.7 million ounces.
Coeur Mining, Inc. (NYSE:CDE), is the largest U.S.-based primary silver producer and a noteworthy gold producer with four precious metals mines in the Americas employing nearly 2,000 people.
TETRA Technologies, Inc. (NYSE:TTI), soared 4.29%, in an afternoon trade, following the news that Peter J. Pintar, presently TETRA’s Senior Vice President – Corporate Strategy and Development, will become Senior Vice President of TETRA’s Offshore Services Division. Mr. Pintar will report to Joseph Elkhoury, TETRA’s Senior Vice President and Chief Operating Officer. Mr. Pintar succeeds Edwin H. Goldman, who is retiring from TETRA. Mr. Goldman is predictable to remain with TETRA through a transition period.
TETRA Technologies, Inc. (NYSE:TTI), is a geographically diversified oil and gas services company, focused on completion fluids and associated products and services, water administration, after-frac flow back, production well testing, offshore rig cooling, compression services and equipment, and selected offshore services counting well plugging and abandonment, decommissioning, and diving.
Peabody Energy Corp. (NYSE:BTU), gained 1.94% and is now trading at $7.22, as Peabody today called on the Obama Administration to reverse its decision to suspend development funding for FutureGen 2.0, America’s first near-zero emissions coal-fueled power plant project that would capture and store carbon dioxide.
Peabody Energy Corp. (NYSE:BTU), is the world’s largest private-sector coal company and a global leader in sustainable mining, energy access and clean coal solutions.
