Friday morning brought another relatively calm session to Wall Street, as major market benchmarks were generally higher but by modest amounts. Market participants are trying to be patient in seeing whether the recovery from the worst of the coronavirus pandemic will continue or whether a new wave of COVID-19 cases will force people to reassess the trajectory of the disease. Just after 11 a.m. EDT today, the Dow Jones Industrial Average (DJINDICES:^DJI) was up 146 points to 26,226. The S&P 500 (SNPINDEX:^SPX) gained 19 points to 3,135, and the Nasdaq Composite (NASDAQINDEX:^COMP) picked up 88 points to 10,031.
Among sectors of the market, energy stocks did the best, with gains between 1% and 2% for sector ETFs focusing on the industry. Some of that rise came from favorable moves in the crude oil market, but a few individual stock names also made news that gave shareholders something to cheer.
Another move higher for oil
Crude oil prices have been extremely volatile in recent months, as coronavirus-inspired business closures sent demand for energy products tumbling. Now, businesses are starting to reopen, and that’s helped to bring supply and demand into a better balance. Moreover, efforts from OPEC nations and Russia to curtail productions levels have prevented more gluts of crude on the global market.
One interesting shift has happened in the oil market. Investors are now paying more for spot oil and near-term oil futures contracts than they are for crude for delivery further into the future. That’s a dramatic reversal from the state of the crude market just a couple of months ago, when investors were briefly willing to pay to have others take crude oil off their hands.
Take 2 for Marathon Petroleum sale?
Among individual energy companies leading the sector higher, shares of Marathon Petroleum (NYSE:MPC) rose 6%. The downstream refining and marketing specialist has gone on a roller coaster ride in recent months, but news today suggested that a strategic move that many thought was no longer an option could now be back on the table.
Marathon is the company behind the Speedway chain of gas stations, and it’s been looking to sell Speedway for some time now. Activist investors in Marathon have highly supported doing something with the gas station chain to unlock shareholder value. But attempts either to spin off the unit as a separately traded company or to sell to Japanese 7-Eleven parent company Seven & i Holdings didn’t lead to a favorable resolution, especially with the coronavirus pandemic complicating matters for the would-be buyer.
Now, though, Marathon is back in discussions with potential bidders to sell Speedway. Reports suggest that the purchase price might be closer to $18 billion, down from the $20 billion that it had hoped to get from Seven & i earlier this year.
Investors are excited about a possible deal, because…