Last week was successful again for the UP World LNG Shipping Index (UPI), which reached a new all-time high. Over the past week, two significant news events affected some UPI constituents: the potential takeover of Golar LNG and Saudi Arabia’s increase in oil output.
UPI & SPX
Last week, UPI, which tracks listed LNG shipping companies, gained 4.99 points, or 2.92%, closing at 176.15 points. The S&P 500 index gained 0.62%. The chart below shows both indices with weekly data.
Broader view
Stock markets continued to rise last week, fueled by optimism from the Fed. The UPI reached a new all-time high, closing above the previous level of 174 points. The uptrend began in May.
Constituents
Over the past week, two significant news have affected some UPI constituents. Saudi Arabia’s announcement of a potential increase in oil output impacted the gas and oil drilling trio. Additionally, speculations on Friday about a potential acquisition of Golar LNG (NASDAQ: GLNG).
GLNG’s stock price increased 9.9% last week, with most of the rise occurring on Friday due to rumours of a takeover by Perenco. Perenco, through its investment affiliate Naria, holds a 10% stake. Stifel analyst Ben Nolan mentioned in a note published by Seeking Alpha that if a deal were to be agreed upon, it would likely be at a substantial premium to the current share price, possibly above $60/share and definitely not below $50/share.
On Thursday, the Financial Times reported that Saudi Arabia is ready to abandon its unofficial price target of $100 a barrel for crude as it prepares to increase output. The three UPI constituents reacted differently to this news. BP (NYSE: BP) and Shell (NYSE: SHEL) lost about 3.7%, while Chevron (NYSE: CVX) remained at the level and closed 0.1% lower.
Korea Line Corporation (KRX: 005880), which grew by 10%, made the biggest gain. It was followed by Capital Clean Energy Carriers (NASDAQ: CCEC), which rose by 7%. KLC continues in the „wide range“uptrend we wrote about several weeks ago.
Excelerate Energy (NASDAQ: EE) continues upward, gaining 6.1%.
Two Japanese shippers gained about five per cent. „K“ Line (TSE: 9107) was more successful, with a gain of 5.8 per cent, and NYK Line (TSE: 9101) rose by 5.1 per cent. The third of Japan´s trio, MOL or Mitsui O.S.K. Lines (TSE: 9104), added 1.3 per cent.
New Fortress Energy (NASDAQ: NFE) gained 3% last week, but on Monday, September 30th, it announced a delay in the dividend payment, causing a downtrend again.
In the earlier part of this report, we mentioned some stocks that have declined. We have a few more to add. One is Awilco LNG ASA (OSE: ALNG), which experienced a 4.7% drop but has since stabilised. MISC (KLSE: 3816) saw a 1.6% decline, which has left analysts uncertain whether it marks the beginning of an upward trend or confirms a downward trend. Both scenarios are possible.
Established in 2020, the UP World LNG Shipping Index is a rules-based stock index family designed to measure the performance of worldwide publicly traded companies involved in the maritime transport of liquefied natural gas (LNG). This unique index covers 19 companies and partnerships worldwide, representing over 65% of the world’s LNG carrier fleet in 2020. The UP Index offers premium services with freemium and trial access to charts. With Freemium, users can access the basic UPI vs S&P 500 chart after email registration. The trial includes full access for fourteen days.
Source: By Tomas Novotny, UP-Indices.com