Why ExxonMobil Tanked at the Open on June 15
The shares of integrated energy goliath ExxonMobil (NYSE: XOM) fell sharply at the open on June 15, losing over 5% of their value in the first few minutes of trading. A sizable decline in the price of oil and in the broader equity market were the driving forces. However, by 11 a.m. EDT, it seems investors weren't quite as dour as they were at 9:30 a.m., with oil prices, the S&P 500 index, and Exxon's stock all paring their losses. Exxon, by 11 a.m., was down just 2% or so.
The underlying theme here really isn't much different than it has been for several months: COVID-19. That, however, doesn't do justice to the situation that Exxon and most oil companies face, because it hides just how complex the dynamics are in the energy sector right now. The crux of the concern today is that efforts to contain the coronavirus, notably including shutting down economic activity, haven't been enough to stop COVID-19's spread. Indeed, as a number of U.S. states have begun to reopen their economies, they have seen an uptick in cases. China has also seen new outbreaks. But it's the tap-on effects that are so troubling for the oil market.
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Source Fool.com