Dallas, Texas 10/30/2013 (Financialstrend) – The market heavy weight Exxon Mobil Corporation (NYSE:XOM) with a market cap of $394 billion is tracked by both DJIA and S&P 500 index. During trading yesterday, it has posted a 0.79% increase in its market value compared to previous day close. As of close of business on October 29, the stock was trading at $88.93 per share which is just 6.23% below its 52 week high bench mark.
In the run up to the third quarter earnings call over the next few days by a host of mega capped oil and investors tracking the energy sector would be keeping their fingers crossed hoping for good results. Yesterday BP reported its 3Q results which were surprisingly robust considering the downward pressure on the price of Oil in the international markets. As a salute to the positive numbers from BP, shares prices of both Exxon and Chevron appreciated by 0.7% and 0.2% respectively.
While investors might be short sighted in hoping for strong results announcement, a deeper look at the overall oil market scenario makes for troubled reading. BP has reported close to 34% dip in its net income. While this was above analyst expectations, it was still down from its last year’s performance. Also troubling was the fact that BP’s production went down by 2.3% this quarter. In early October, Chevron had indicated that its oil production had dipped during 3 quarter slightly. When investors start joining the dots, they will see that the oil mega caps are having a tough time in sustaining their net profit levels at the current price of crude oil. Also hurting the profitability of the companies is the increasing stock of oil in comparison to previous years. This has led to the price fluctuations and companies due to drop in oil consumption in U.S.