Wednesday, November 7, 2012

Coal companies’ shares Pull Back after Obama re-election – ANR, BTU, CNX, WLT, ACI

One sector which is definitely not celebrating Barack Obama's re-election as the President of the United States for the next four years is the coal sector.

Coal companies are apprehensive that Obama will be imposing stricter environmental regulations on the sector.

Should Investors Buy The Coal Sector After Today’s Slump? Find Out Here

The Obama Administration, through the Environmental Protection Agency, had set rules limiting greenhouse gas emissions from power plants. This has forced companies to retire many of their coal-fired plants or install expensive new pollution-control equipment.

Shares of coal companies such as Peabody Energy Corporation(NYSE:BTU) -2.39 (-8.23%), Alpha Natural Resources, Inc.(NYSE:ANR) -0.98 (-10.19%), CONSOL Energy Inc.(NYSE:CNX) -2.08 (-5.85%), Walter Energy, Inc.(NYSE:WLT) -2.85 (-7.63%) and Arch Coal Inc(NYSE:ACI) fell more than 12%.

The sector had some hopes that if Mitt Romney had been elected he would have soft-pedalled the issue as he had against excessive  imposition of environmental regulations against the coal companies, which he said had hampered growth.

Some of the coal companies however are feeling relieved that the elections are over and the uncertainty is at an end.

"We believe that this issue caused a temporary slowdown in economic growth both in the United States and globally," James River Coal Co.'s Chief Executive Peter Socha said in a statement announcing the company's quarterly results.

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