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Strategies & Market Trends : Fidelity Select Sector funds -- Ignore unavailable to you. Want to Upgrade?

To: Mike McFarland who wrote (973)	9/16/1998 5:09:00 PM
From: gregor	Read Replies (1) \| Respond to of 4916

Mike: Here is a lot or relevant information on the nat gas market...to me it boils down to the fact you may expect we have reached an intermediate term high for the next few months.. what is your take ? ********************************************************************** In the day session, October rallied 11.8 cents to close at $2.241 per million British thermal units after trading between $2.085 and $2.26. Then on ACCESS, October slipped to $2.175 shortly after the AGA stock report before recovering slightly to the $2.20 area. November settled 8.6 cents higher at $2.477. Other deferreds ended mixed, with some 1999 and 2000 contracts finishing down one to 2.7 cents. ''It's a terrible number. It's above expectations, and I think the market is going to get smashed,'' said one Midwest trader, noting the approach of typically-soft autumn demand. AGA said Wednesday U.S. gas stocks rose last week by 70 bcf, well above Reuter poll estimates in the 50-60 bcf range. But the number still trimmed the year-on-year surplus by 18 bcf to 381 bcf, or 16 percent. Eastern inventories rose 42 bcf last week and were nine percent above last year. Consuming region west storage, which climbed 10 bcf for the week, was up 12 percent from 1997 levels. Stocks in the producing region gained 18 bcf and stood 34 percent over year-ago. To get storage to 3.0 trillion cubic feet by October 31, weekly injections of about 32 bcf are needed. Despite the bearish inventory number, traders said concerns about another storm brewing in the Gulf could keep aggressive sellers at bay near-term. A low pressure system was reported in the southeast Gulf of Mexico and was likely to move northwestward over the next couple of days, possibly developing into a tropical storm in the central Gulf by Thursday, forecasters said. Chevron said late Wednesday it evacuated some non-essential workers from its oil and gas platforms in the Gulf as a precaution against the storm, but no production had been cut. Meanwhile, Tropical Storm Georges formed in the eastern Atlantic today. As of 1100 EDT, the center of the storm was about 620 miles southwest of the Cape Verde Islands, moving west near 20 mph with maximum sustained winds of 40 mph. WSC expects warm East Coast midweek temperatures to cool slightly but remain two to eight degrees F above normal through Sunday. In Florida, readings mostly will average slightly above normal, while Texas will hover around normal for the period. Midwest temperatures will slip from as much as 12 degrees F above normal at midweek to three to six degrees above normal by the weekend. Technical traders agreed October's strong close yesterday above key resistance at the mid-August highs in the $2.07-2.075 area will likely mean more upside, but some thought the market was overbought and due for a pullback first. They noted October had rallied almost 20 percent in just three sessions this week. October resistance was now seen at today's high of $2.26, and then at $2.35, $2.48 and the July 1 high of $2.56. Support was pegged first at $2.075, then at $1.98, $1.835 and at last week's low of $1.78. In the cash Wednesday, Gulf Coast swing quotes jumped more than 20 cents to the low-teens. Midwest pipes were almost 20 cents higher in the low-$2s. Gas at the Chicago city gate was 15 cents higher at about $2.15, while New York was up more than 20 cents to the low-to-mid $2.30s. In the West, El Paso Permian was almost 20 cents higher in the mid-$1.90s.