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Energy sector shows signs of life after selloff

NEW YORK (Reuters) – Energy shares were trading higher on Wall Street Tuesday, putting the S&P energy index <.SPNY> on track for a second straight day of gains as oil prices showed signs of stabilizing.

Brent crude <LCOc1> climbed above $98 after hitting a 26-month low in the prior session while U.S. crude <CLc1> gained 78 cents to $93.70 on the possibility of an output cut from OPEC. [O/R]

After reaching an all-time high of 737.09 on June 23, the S&P energy index <.SPNY> slumped 8 percent through Friday as Brent crude tumbled on demand concerns from a high of over $115 a barrel in June. If Tuesday’s gains hold for the sector, it would mark the first time the index has posted consecutive daily gains in three weeks.

Among the leaders to the upside were Exxon Mobil <XOM.N>, up 0.8 percent to $97.04, and Schlumberger <SLB.N>, up 0.7 percent to $103.72. At their current prices, the stocks appear to be undervalued, according to Thomson Reuters StarMine data, which holds an intrinsic value of $107.90 on Exxon and a $112.10 value on Schlumberger.

Related: Stocks fall as oil price slump hits energy sector

 

(Reporting by Chuck Mikolajczak; Editing by Bernadette Baum)

This article was from Reuters and was legally licensed through the NewsCred publisher network.

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