Worse

The impact of Enron’s tailspin on the energy industry has been more severe than expected, Merrill Lynch analyst Carl Kirst said in a research note reviewing the investor exodus from merchant energy stocks this week — prior to Wednesday’s small rebounds.

Last week, Enron Corp. saw things go from bad to worse, with its stock price continuing to plummet, a formal probe launched by the U.S. Securities and Exchange Commission, downgrades by credit ratings agencies and energy analysts, and finally, a letter to the board from one of its largest shareholder groups urging the energy trader to begin making reforms in its practices to restore some investor confidence.

When things just started to look like they were getting better,all of a sudden they just got worse for MCN Energy Group. After atough year in 1998 and the planned divestiture of its entireexploration and production division, MCN Energy Group said lastweek it discovered serious financial accounting manipulation withinits gas marketing subsidiary, CoEnergy Trading, and will have torecalculate its earnings going back to 1997.

When things just started to look like they were getting better,all of a sudden they just got worse for MCN Energy Group. After atough year in 1998 and the planned divestiture of its entireexploration and production division, MCN Energy Group saidyesterday it has discovered serious financial accountingmanipulation within its gas marketing subsidiary, CoEnergy Trading,and will have to recalculate its earnings going back to 1997.