A grisly bear grip

2016 stran­gling Colorado mar­ket in­dex, down 27.1% since April high

The Denver Post - - BUSINESS - By Aldo Svaldi

The worst open­ing week for U. S. stocks has shoved a Colorado mar­ket in­dex firmly into the claws of a bear mar­ket.

The Dow Jones In­dus­trial av­er­age is down 10.1 per­cent from the high it reached May 9, while the Nas­daq com­pos­ite is down 11 per­cent from its July 20 high.

That meets the def­i­ni­tion of a cor­rec­tion — de­fined as a 10 per­cent or greater drop in price from a re­cent peak. A cor­rec­tion be­comes a bear mar­ket when prices fall 20 per­cent or more.

By that def­i­ni­tion, the Bloomberg Colorado in­dex, a bas­ket of 75 stocks based in the state, is growl­ing with a 27.1 per­cent de­cline since its April 21 high.

The Bloomberg Colorado in­dex al­ready was danc­ing on the edge of bear- mar­ket ter­ri­tory at the end of 2015, but an 8.3 per­cent drop this year has re­moved any doubts.

The state in­dex is price- weighted, mean­ing higher- priced shares have more in­flu­ence on its per­for­mance than lower- priced ones.

On­go­ing food- safety trou­bles at Chipo­tle Mex­i­can Grill, whose shares ac­count for about a fifth of the in­dex’s to­tal weight, have hurt.

For years, the Den­ver- based restau­rant chain seemed un­stop­pable. But its shares have suf­fered a 45.5 per­cent plunge fromthe Aug. 5 peak, in­clud­ing a 13.9 per­cent drop so far this year.

At the end of the third quar­ter of 2015, Chipo­tle had amar­ket value of $ 22.5 bil­lion — mak­ing it the state’s se­cond- largest com­pany in mar­ket value. It now ranks fifth, with a value of $ 12.9 bil­lion.

Shares of Dish Net­work, the state’s largest pub­lic com­pany in mar­ket value, have fallen 5.9 per­cent this year and by nearly a third from a high set Nov. 28, 2014.

So count the Dou­glas County satel­litetele­vi­sion provider among those that have dis­ap­peared into the bear’s lair.

Shares of Broom­field- based Level 3Com­mu­ni­ca­tions, the state’s se­cond- largest pub­lic com­pany in value, have fared bet­ter, fall­ing 8.1 per­cent this year and 12.2 per­cent from a high set May 4.

Here’s an ex­am­ple why bear maul­ings are so hard to over­come: In­vestors once val­ued Level 3 shares at $ 1,952.74 dur­ing the dot- com peak in March 2000. The broad­band com­pany is now val­ued at $ 49.95 a share, or about $ 20 bil­lion below its all­time peak.

Mol­son Coors Brew­ing, the state’s third­largest com­pany, seemed to defy the down­ward pres­sure on stocks last year as merger ma­nia gripped the beer in­dus­try. Its shares, how­ever, are down 6.2 per­cent from the high reached Dec. 4, in­clud­ing a 5 per­cent de­cline this year.

DaVita Health­Care Part­ners, the state’s fourth- largest com­pany in mar­ket value, is about to slip into the bear mar­ket’s grip. Its shares are down 19.7 per­cent froma May 28 high.

Many of the state’s en­ergy stocks, both tra­di­tional and al­ter­na­tive, have been laid to waste and left for dead.

Whiting Pe­tro­leum is down 91.4 per­cent from its high Aug. 29, 2014, in­clud­ing a 17.7 per­cent drop this year. Tri­an­gle Pe­tro­leum has shaved 94.5 per­cent from the high it reached June 23, 2014, in­clud­ing a 12.6 per­cent tear in mar­ket value this year.

As­cent So­lar Tech­nolo­gies shares are down 20.9 per­cent this year. At 11 cents, they are a faint shadow of the $ 267.50 price com­manded Dec. 28, 2007.

One group of Colorado stocks that tried to stay pos­i­tive dur­ing this past bru­tal week­were min­ers of gold and rare me­tals, which of­ten are viewed as a store of value in un­cer­tain times.

But by Fri­day, many of those gains were sur­ren­dered.

Shares of Den­ver-basedNew­mont Min­ing, a lead­ing gold miner, were up 4.8 per­cent for the year Thurs­day but up only 0.11 per­cent at Fri­day’s close.

New­mont shares have shed three- quar­ters of their value from a Novem­ber 2011 high.

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