Wall Street and London Stock Exchange Experience Tremors on Friday
SPY closed down at -1.63%
US markets were more volatile after the Federal Reserve’s decision to hold onto current interest rates. The equity markets have baffled some US investors as markets rewarded the rate decision with an increase in volatility on Friday, September 18, as the SPDR S&P 500 ETF (SPY) fell by 1.63%. We will look at key players and stocks in play in the US market in subsequent articles.
Chesapeake rose by 4.07%
The top gainer of the day was the oil and gas company, Chesapeake Energy (CHK). The stock rose by 4.07% on September 18. The graph below shows the price movement of the stock since September 1, 2015.
Chesapeake Energy (CHK) has a beta of 1.16 and it showed it, as the stock was more volatile during the Federal Open Market Committee’s meeting on September 16–17, 2015. The trailing five-day return was 18.36% while the stock fell by 4.33% on September 17. The stock again rose by 4.07% on Friday, September 18. On September 18, CHK traded at $8.96, which is above its 50-day and 20-day moving average of $8.00.
However, CHK’s upward momentum is not a good predictor of future prices since the stock is driven by both equity market volatility, in addition to the volatility from oil and natural gas prices. The analyst stock price target for CHK is $9.76, and its trailing one-year return is -63.68%. The stock has received seven “buy” recommendations, eight “sell” recommendations, and 20 “hold” recommendations.
Energy sector
The energy sector experienced another deep plunge on September 18, which has been the norm rather than the exception of late—the sector fell by 3.34%. With the exception of Chesapeake Energy (CHK) and Williams Companies (WMB), all the energy stocks headed south, including major stocks like Diamond Offshore Drilling (DO), Transocean (RIG), and Ensco (ESV).
Next, let’s look at the sector performances and other leading and lagging stocks on Friday, September 18.
Continue to Next Part
Browse this series on Market Realist: