Exxon, Chevron Shine as Oil Rally Rattles Stocks

Carnival, on the other hand, is getting dragged down on spiking fuel prices

Digital Content Manager
Sep 16, 2019 at 1:24 PM
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Stocks are lower today, and the Dow is on pace to snap its eight-day win streak as drone strikes in Saudi Arabia have oil prices skyrocketing, sparking even more geopolitical anxieties. Three stocks in particular moving on the news are cruise concern Carnival Corp (NYSE:CCL), as well as oil majors (and Dow stocks) Exxon Mobil Corporation (NYSE:XOM) and Chevron Corporation (NYSE:CVX). Below, we'll take a look at what's moving the shares of CCL, XOM, and CVX. 

Carnival Stock Sinks on Sector Sell-Off

The shares of Carnival have fallen victim to today's sell-off, as investors fret over higher fuel costs for cruise (and airline) companies. The stock is now off 2.1% at $49.46, just one session after touching a two-month high of $50.87 on Friday. Now, CCL is testing support near its year-to-date breakeven, which roughly coincides with its 100-day moving average. 

Options bears are piling on today, with 5,530 puts across the tape so far -- five times the intraday average. Most active is the deep out-of-the-money weekly 11/1 42.50-strike put, where a block of 2,300 contracts traded earlier for $0.34 per contract. This strike has zero contracts in open interest at the moment, suggesting that new positions are being opened here today. 

Exxon Mobil Stock Extends Rally

The oil sector, on the other hand, is enjoying a boost amid the drone strike news, lifting Dow member Exxon 1.5% higher to trade at $73.74. As a result, XOM stock is on pace for its first close atop its 80-day moving average since May 1. Familiar pressure at its 200-day moving average, however, lingers just overhead. 

There was a decent amount of pessimism priced into the oil major stock heading into today, which is likely contributing to the XOM rally. The stock's 10-day put/call volume ratio across the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) ranks in the 84th percentile of its annual range, suggesting a healthier appetite for bearish bets over bullish on Exxon in recent weeks. 

Chevron Stock Leads Dow at Midday

Fellow blue chip Chevron is at the top of the Dow at midday, also getting a lift on surging oil prices. In fact, the stock hit its highest intraday price since July 25 earlier, topping out at $125.27. Now, CVX is up 1.9% at $123.78 after finding its footing atop the $123 region, which has alternately acted as support and resistance this calendar year.

Unlike XOM, with its 80% "hold" and "sell" ratings, CVX has a fairly bullish following among brokerage firms. Twelve of the 14 analysts in coverage call Chevron a "buy" or better, and the consensus 12-month price target of $138 represents a level the security has yet to touch. 




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