Colorado stock values plummeted for a second day, with natural resource companies replacing consumer goods importers in taking the brunt of the drubbings dished out on Friday by fleeing investors.
Unlike Thursday’s trading, where apparel retailers Crocs and VF Corp., owner of Timberline and Vans, were hit hardest over a big hike in tariffs, Friday’s losses focused most intensely on oil and gas and mining companies, which are important players in the corporate mix in Colorado.
The five Colorado companies with the biggest losses in share value on Friday were all in the petroleum business: Civitas Resources, down 17.3%; Liberty Energy down 15.8%; Ovintiv down 15.7%; Antero Resources, down 13.7%; and SM Energy, down 12.12%.
Widespread tariffs levied by the Trump administration on Wednesday have sparked the steepest sell-off in stocks since the pandemic arrived in March 2020.
Natural resource companies, in theory, should have fared better than importers of products from other countries. But concerns that a trade war could result in a global slowdown and lower energy and materials consumption helped push oil prices down 10% this week.
If that weren’t bad enough for domestic producers, the Organization of the Petroleum Exporting Countries made a surprise announcement that it would raise crude production by 411,000 barrels per day in May despite signals of too much supply.
“While conjecture on our part, OPEC+ could be trying to retake share from U.S. shale, gambling that independents have drilled through their highest-quality inventory. Still, most U.S. shale firms boast breakeven prices well below current oil prices,” Joshua Aguilar, a research analyst with Morningstar, wrote in a research note Friday.
Aguilar downgraded his estimates of the value of domestic producers by about 4%, which in body terms is equivalent to cutting off an arm somewhere below the elbow. Investors on Friday hacked off closer to 15% off the value of Colorado’s petroleum producers, the equivalent of removing an entire leg.
Mining and royalty companies weren’t hit as hard, but they were next in line when it came to big losses. Shares of Sitio Royalties Corp. lost 11.4% in value; Intrepid Potash shares fell 10.5%; Vista Gold was down 10.11%; SSR Mining was down 9.8% and the big daddy of the state’s gold producers, Newmont Mining, lost 8.61% in share value, which works out to $5.1 billion in lost market value.
Although gold remains a hedge against economic uncertainty, it had run higher ahead of the tariff announcements and fell when the details came out. Federal Reserve Chairman Jerome Powell also took a hawkish stance on inflation, saying future interest rate cuts might be delayed if prices increase due to tariffs. Higher interest rates make gold alternatives like U.S. Treasuries more attractive.
An analysis of trading in 57 Colorado-based public companies showed a one-day loss of $43.7 billion in market value on Friday, which represented a 9.6% decline in the state’s overall market capitalization. Over half of that loss, $22.5 billion, came from an 11.5% decline in shares of Denver-based Palantir Technologies, which is Colorado’s largest public company and had been enjoying a rapid run the past year.
Shares of Denver-based VF Corp., which owns several popular brands like The North Face and Dickies, received a reprieve on Friday, dropping 1.1% after a crushing 28.7% decline on Thursday. And Crocs shares rose 4.9% after a 14% loss on Thursday, making it one of only five Colorado companies to show a gain.
The Nasdaq Composite on Friday officially entered bear market territory, which is defined as a 20% or greater decline from the most recent high in value.
But the bears have been quite active in Colorado, with 47 of the 57 stocks tracked having already suffered a 20% or greater decline from their 52-week highs. Another eight are in correction territory, defined as a loss of 10% or more from the recent high, but short of a 20% decline. And only two are within 10% of their recent highs.
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