The UP World LNG Shipping Index (UPI) fell 1.79% (3.01 points) to 165.38, tracking broader market weakness as the S&P 500 dropped 1.66%. Heightened volatility followed shifts in U.S. policy, raising investor concerns despite potential benefits for LNG shipping. UPI failed to break the 169-point resistance level, with trading volumes remaining below average. Several companies are nearing or breaking key support levels, reflecting increased uncertainty in the sector, reports UP-Indices.
UPI vs. S&P 500: Market Pressure Continues
The UP World LNG Shipping Index (UPI), which tracks publicly listed LNG shipping companies, lost 3.01 points (1.79%), closing at 165.38, while the S&P 500 declined 1.66%. The chart below highlights the weekly performance of both indices.
A Volatile Market Amid U.S. Policy Shifts
Equity markets reacted to changing U.S. policies with increased volatility, leaving investors uneasy about regulatory uncertainties. While some adjustments could favor LNG shipping, broader implications remain unclear.
Stock Performance: UPI Struggles Against Resistance
The UPI mirrored broader stock indices, failing to breach the 169-point resistance level and continuing sideways. Trading volumes were below average, and several companies are testing or breaking key support levels.
Notably, there were no double-digit moves this time. The biggest gain was 4.4%, while the largest decline reached 8.1%. Overall, the index fell due to a greater number of declining stocks and deeper losses among them.
- New Fortress Energy (NASDAQ: NFE) continued its downtrend.
- Cool Company (NYSE/OSE: CLCO) and Flex LNG (NYSE/OSE: FLNG) dropped 6.6% and 6.2%, respectively. FLNG declined post-dividend record date, while CLCO is set to release earnings on February 27.
- Golar LNG (NASDAQ: GLNG) lost 4.3%, hovering near October support levels. Dynagas LNG Partners (NYSE: DLNG) declined 3.3%, approaching April 2024 resistance.
- BP (NYSE: BP) fell 3.2% following an acquisition-related surge. Tsakos Energy Navigation (NYSE: TEN) slipped 3.1% and is now below its support.
- Several stocks, including Awilco LNG (OSE: ALNG), “K” Line (TSE: 9107), Excelerate Energy (NASDAQ: EE), MISC (KLSE: 3816), and NYK Line (TSE: 9101), declined around 2.6%. Mitsui O.S.K. Lines (TSE: 9104) lost 1.8%, as Japanese shipping stocks failed to break long-term resistance.
On the upside, Korea Line Corporation (KRX: 005880) led gainers with a 4.4% rise, followed by Chevron (NYSE: CVX), which added 1%.
Market Outlook: More Volatility Ahead
The short-term outlook remains cautiously optimistic, but volatility is expected to persist in the coming weeks. While LNG spot rates remain low, the overall impact on UPI constituents has been marginal. Investors are watching for potential breakouts at key resistance levels that could determine future price trends.
Long-term, demand for LNG remains strong, supported by ongoing infrastructure investments and long-term contract negotiations. Investors should monitor policy shifts, competitive pressures, and upcoming corporate earnings for further market direction.
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Source: UP-Indices
