Dynegy, Duke Energy and Progress Energy Weigh on Utility Stocks: DYN, NRG, CPN, DUK, PGN, XLU
Electric utility (NYSE:XLU) shares were depressed with Dynegy Inc. (NYSE:DYN) falling over 10% today before the big rally. Other shares declining in the sector most of the day were NRG Energy (NYSE:NRG), Calpine Corp (NYSE:CPN), and Duke Energy (NYSE:DUK).
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One reason weighing on these stocks is the Federal Energy Regulatory Commission’s unfavorable outlook on the proposed $26 billion merger between Duke Energy (NYSE:DUK) and Progress Energy (NYSE:PGN). The merger would create the nation’s biggest electric utilities, but regulators are questioning the public benefits of the deal on the one hand, and monopolistic outcomes on the other.
The federal commission said Friday it agreed with New Bern, a community of 30,000, 120 miles southeast of Raleigh, that the proposed merger “will increase already excessive levels of market concentration” in Duke’s (NYSE:DUK) and Progress’ (NYSE:PGN) service areas, particularly in Eastern North Carolina.