The latest Market Talks covering Energy and Utilities. Published exclusively on Dow Jones Newswires at 4:20 ET, 12:20 ET and 16:50 ET.
0719 GMT - SSE's full year outlook has improved since the start of May owing to higher and more volatile gas and power prices, J.P. Morgan analysts write. The comments come after the power distribution company's first-half trading update, which was in line with expectations, the analysts say. With the key winter months ahead, SSE's ability to capture the higher and more volatile prices will depend on market conditions and renewables output, they say. Consensus expectations could rise if investors believe SSE can benefit further from market conditions, they say. Shares rise 0.8% to 2,502.00 pence.(adam.whittaker@wsj.com)
0705 GMT - SSE posts a solid half-year update that shows the power-distribution company is on track, RBC Capital Markets analysts Alexander Wheeler and Ziyad Jasimuddin write. Full-year guidance is kept unchanged but remains subject to weather, market conditions and plant availability, with the key winter months yet to come, they write. Shares fall 0.8% to 2,470.00 pence. (adam.whittaker@wsj.com)
0503 GMT - Torrent Power's future earnings growth over the next three years is well supported by its diversification across segments of the power sector, Motilal Oswal analysts say in a note. Despite significant expansion in renewable energy, thermal generation and distribution, the company has maintained a robust balance sheet that positions it well to bid for new projects. The brokerage estimates the company's Ebitda and adjusted profit after tax will grow at annualized rates of 17% and 7%, respectively, over FY 2026-2029. Motilal Oswal initiates coverage of the stock with a Neutral rating and a target price of 1,270 rupees. Shares are down 1.3% at 1,229.90 rupees. (venkat.pr@wsj.com)
2343 GMT - The rise in long bond expectations has ended a short-term trade where investors rotated into infrastructure stocks, viewing them as a safer bet than other assets. RBC Capital Markets says market concerns now reflect global macro uncertainty and longer-term inflation concerns. It notes the U.S. 10-year Treasury yield is above 5% for the first time since 2007. As a result, infrastructure stock valuations have begun to fall. RBC moves to reset its yield forecasts, driving cuts to price targets for six infrastructure stocks in Australia and New Zealand. They include a 20% fall in RBC's price target for Atlas Arteria to A$3.60/share, and a 13% decline for Infratil to NZ$13.75/share. Atlas Arteria ended Wednesday at A$3.95. Infratil is down 2.1% at NZ$13.86 early on Thursday.(david.winning@wsj.com; @dwinningWSJ)
2338 GMT [Dow Jones]--Macquarie retains an outperform call on Amplitude Energy following its decision to advance the East Coast Supply Project in Australia. Still, it thinks investors may want to see results from drilling the Nestor natural-gas prospect and progress in development work before factoring in the full value of the project. "We have risked Nestor at 50% for now," Macquarie says. Amplitude says there's an 81% chance of geological success at Nestor. Macquarie notes there was a 84% probability applied to the Juliet prospect with similar characteristics to Nestor. Juliet was a natural-gas discovery, and flow testing has shown a reservoir of excellent quality. Macquarie retains an outperform call on Amplitude and A$2.50/share price target. Amplitude ended Wednesday at A$1.735. (david.winning@wsj.com; @dwinningWSJ)
2302 GMT [Dow Jones]--Investors are likely to become more bullish about Amplitude Energy's cash flow outlook as the East Coast Supply Project advances, signals Ord Minnett. Amplitude's decision to proceed with the ECSP follows success with the Juliet-1 well. Analyst Tim Elder views Amplitude's plan to drill the Nestor prospect as a sound decision because it makes best use of the available Transocean Equinox rig. The developments materially derisk Ord Minnett's forecast for 57% production growth by FY30. "We expect this should encourage investors to look more favorably on Amplitude's capacity to significantly grow free cash flow by FY29-30, even if there are some near-term risks to exploration (i.e. Nestor) and net debt will increase to A$300 million in FY27," Ord Minnett says. (david.winning@wsj.com; @dwinningWSJ)
1324 GMT - Crude oil futures are higher after trading lower Tuesday. Reports of potential sanctions relief being offered to Russia were a factor dragging oil down, says the Hightower Report in a note. "President Trump later denied those reports, which helped crude oil regain strength early in today's action," says the firm. Oil traders will also be looking for the EIA's weekly report, which analysts expect will show decreased inventories for U.S. crude oil and distillates. WTI crude is up 1.1% to $90.32 a barrel, while Brent crude futures rise 0.6% to $103.19 a barrel. (kirk.maltais@wsj.com)
0845 GMT - The U.K. government could use "golden shares or other veto rights" to shift ownership of the utilities company Thames Water from private investors to public ownership, CreditSights' Helen Rodriguez and Scott Haysom say in a note. Prime Minister Andy Burnham on Tuesday announced that a strengthened Water Bill would be presented to parliament to pave the way for stronger public ownership of U.K. water companies. Golden shares are a special category of stocks that give shareholders superior voting rights over important decisions. The government could use golden shares to shift ownership as these do not involve big financial outlays, the analysts say.
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