Cold Weather Causes These Stocks To Rally. Reported Merger Talks Add To Gains.

• Front-month natural gas prices jumped 74 cents to $3.843 per million BTU, marking the largest one-day gain since January 27, 2022, while the U.S. Natural Gas Fund ETF gapped up 19%
• Expand Energy, the largest North American natural gas producer, gapped up nearly 5% in heavy volume as bitter cold threatened production halts in some areas
• Coterra Energy rose over 3% on reports of merger talks with Devon Energy, which would create one of the largest U.S. oil and gas companies focused on the Permian Basin

Market Summary: Natural Gas Stocks Rally on Cold Weather and Merger Speculation

Key Market Movements:

Natural gas prices surged sharply on Tuesday as severe winter weather gripped the Midwest and Northeast. Front-month natural gas futures jumped nearly 24% (74 cents) to $3.843 per million BTU—the largest one-day gain since January 27, 2022. The most-active contract rose 36 cents (13.3%) to $3.058 million BTU, marking the biggest increase since October 30.

Weather Impact:

Daytime temperatures across affected regions are forecast to be 15-25 degrees below average, with highs in the single digits. Freeze warnings extend as far south as Georgia and central Florida. The extreme cold threatens production halts in some areas, while short sellers covering bearish positions amplified the price rally.

Company Performance:

• U.S. Natural Gas Fund (UNG): ETF tracking natural gas prices gapped up 19%
• Expand Energy (EQT): Largest North American natural gas producer rose nearly 5% on heavy volume
• ExxonMobil (XOM): Advanced 1% to a record intraday high, up 9% from its $120.81 buy point

M&A Activity:

Reports indicate Coterra Energy (CTRA) is in merger talks with Devon Energy (DVN). A combination would create one of the largest U.S. oil and gas companies, with both operating in the Permian Basin. Coterra stock rose over 3%, while Devon gained 2%.

Crude Oil:

Crude futures rose less than 1% on positive Chinese GDP and industrial production data, though U.S.-Europe tensions over Greenland limited demand gains.