Chart of the week: gas price, Petrofac and Rolls-Royce

TL;DR

Petrofac, an oil and gas services company, is expected to benefit from the ongoing natural gas supply crisis, while Rolls-Royce stock may see a boost due to plans for nuclear energy development.

Transcript

hello it's john burford with chart of the week for monday the 27th of september i'm covering today petrofag which is an international oil and gas services company and first i'd like to review very briefly the position in natural gas now natural gas is receiving widespread media attention in fact it's pretty rare that a commodity is featured in fron... Read More

Key Insights

• 🫢 Natural gas prices have seen a significant rise, with Petrofac positioned to benefit from the ongoing crisis.
• 🤘 Petrofac's stock has experienced a prolonged downtrend but is showing signs of a potential reversal.
• 😮 Rolls-Royce stock rebounded after the initial pandemic-related decline and may further rise with plans for nuclear energy development.
• 💹 Momentum divergences on charts have been reliable indicators of potential price movements in various sectors.
• 🏋️ The lifting of the bribery scandal for Petrofac and the potential nuclear energy orders for Rolls-Royce contribute to their positive outlooks.
• 🫢 Political factors and supply constraints are expected to contribute to the continuation of the gas supply crisis.
• 🫢 Natural gas prices receiving widespread media attention indicates the magnitude of the crisis.

Questions & Answers

Q: How did the chart of natural gas prices indicate a potential rally?

The chart showed a valid trendline and a spike in August last year, accompanied by a massive momentum divergence, signaling a sharp rally and reversal to the upside.

Q: Why is Petrofac expected to benefit from the natural gas supply crisis?

Petrofac is likely to pick up contracts in the gas sector as the gas supply situation is expected to persist, with the unlikelihood of a change in policy by Mr. Putin to increase gas supplies to Europe.

Q: What is the current trend in Petrofac's stock?

After a significant decline over the past decade, Petrofac's stock showed a potential reversal with a poke above the downtrend line, indicating a possible advance.

Q: What caused the initial pessimism surrounding Rolls-Royce stock?

Rolls-Royce stock faced pessimism due to the belief that air travel would be severely impacted for a long time, leading to a major low in sentiment and share price.

Q: What recent development could boost Rolls-Royce stock?

The government's plans to bring back nuclear energy and order mini reactors from Rolls-Royce are expected to positively impact the company's stock price.

Summary & Key Takeaways

• Natural gas prices have been on the rise, with Petrofac poised to benefit from the ongoing gas supply crisis.

• Petrofac has experienced a long period of decline but is showing signs of a potential reversal, with a significant upside break in its downtrend line.

• Rolls-Royce stock, which initially faced pessimism due to the impact of the pandemic on air travel, has rebounded significantly and could further rise with plans for the development of nuclear energy.