Excellent discussion - thank you! Let me throw out a few other considerations.
The NG price effect: while it's true that NG pricing is really low and may be going lower, NG generation output is limited by the number and type of existing NG plants. Many NG plants were originally designed to operate for peak load and are not baseline generators. Certainly it's cheaper and quicker to build NG plants but it still takes years.
And while they generate less greenhouse gases than coal, upstream methane release is a huge problem that can't be ignored. Nuclear generation is much cleaner but, as mentioned, short-sighted politicians, "business economics" (as opposed to healthy Earth economics), and lack of real concern for the environment will promote NG for the near term. However, you make a great point about NG plants limiting the argument about coal plant closure.
That relief EXC was asking for was tied to a claim that some IL plants would be shut down because they are not profitable. EXC has since determined that they are not losing money at these plants so that leverage may now be lost.
I can think of other possible reasons which I don't necessary believe to be true:
* EXC perceived as overpaying for POM;
* A perception that EXC won't get approval for POM merger (but POM is moving as if it will go thru) which they claim will be accretive to earnings after the first full year;
* Continued drop in NG pricing which drags heavily on EXC auction pricing;
* Anticipated interest rate rise causes borrowing costs to rise.
* Tax selling as has been mentioned and/or a big shareholder cashing out slowly.
On balance you might consider:
* EXC will likely benefit greatly from any carbon tax solutions coming out of Paris or USA (but coal will be buying lots of votes at the continued expense of our health).
* We're likely near a bottom in NG pricing - especially if our dysfunctional Congress approves exporting it.
* No news one can directly attribute to the recent drop.
If you're a short-term "investor" you're probably in the wrong stock.
Survive? Yes, but their liabilities are going to grow exponentially. Given the current political climate in Brasil you are going to see the sitting president play this (real) disaster up to create maximum distraction away from her and the Petrobras scandal. For the near term BHP/Vale are going to be vilified and there will be lots of BP-like lawsuits adding up to billions of $$ (which won't be settled for years and may or may not ever be actually paid). They deserve to pay dearly but the realist in me knows they will survive. You can expect more costly demands from other countries regarding their waste disposal practices too.
And potential Rio Dolce liabilities are just one concern. In case anyone hasn't noticed :) mining and oil are in the midst of a severe downturn that may last a while. Add to that the inevitable dividend cut (or perhaps suspension) that's coming. What's an investor to like? Lookout below ...