Caterpillar Inc. (CAT – Analyst Report) is one of the well-known names in the construction and mining machinery industry with a market capitalization of $33.96 billion.It is a leading exporter in the U.S. with more than half of its sales being generated outside the country. Caterpillar yesterday reported a 38% decline in its global retail sales for the three months ended Dec 2015. In fact, this was the worst three-monthly performance in 2015, which witnessed an average decline of 16%. This does not bode well for its fourth quarter performance. A stronger dollar and continued weakness in agriculture have also negatively impacted sales...
The U.S. economy is going in a positive direction: a fall of 5.1% in durable goods orders and a disappointing 1.2% fall in the core figure. In addition, the previous numbers were both revised down from 0% to -0.5%. The only positive figure in this bulk is a minor beat in weekly jobless claims: 278K. The USD is falling across the board. The moves aren’t huge, but the pressure is clear. Talk about a recession is going to grow. This naturally feeds into the GDP growth figures for Q4 published tomorrow. EUR/USD is pushing a bit higher, reaching a high of 1.0928. The pair’s moves are slow. GBP/USD is at 1.4323. Earlier, UK GDP met expectat...
The DAX 30 may reach the January 13 high of 10,165 as long as it trades above the January 26 low of 9563. Traders will probably add to their long exposure on a corrective move to the support range of 9639 to 9753. An alternative entry is a break to the January 14 high of 9945. A break to this level would also accelerate the uptrend as its fair to expect there is a layer of buy orders and stop loss order above 9945. Data pieces to watch today are U.S. Durable Goods Orders and Initial Jobless Claims. A Bloomberg News survey projects an outcome of -0.7% MoM and 281K respectively. My base case is that better than expected data will lift the DAX ...
Electronic Arts (EA) seems to have a habit of beating the market. The market ended 2015 in the red but EA was up roughly 50% for the year. Even in 2016, EA is off to a decent start as the stock is down only about 2% which is impressive in the current selloff. While many big-name tech stocks have lost considerable value this year, EA has managed to sustain its outperformance. EA’s past performance has been good, but investors are wondering if the stock can continue its long-term upward trajectory in 2016 amid the market correction. Given the current market sentiment, it is possible that EA may struggle at least in the short-term. However, I ...
Johnson Controls Inc. (JCI – Analyst Report) is a supplier of automotive interiors, batteries, and other control equipment. The company is gaining from its market expansion in China. It anticipates significant growth opportunities in China. In addition, Johnson Controls will benefit from the acquisitions and mergers that it undertakes to provide customers with world-class technologies through strong complementary brands and channels. However, the divestiture of several businesses has been weighing on the Johnson Controls’ revenues and profits. Johnson Controls also faces strong competition from major domestic and international manu...
Gold supplies took a nosedive as demand increased in the final quarter of 2015, according to the latest GFMS Gold Survey by Thompson Reuters. Total gold supply dropped 7% in Q4 of 2015, driven down by a 4% decline in mining production. It was the largest decline in mine output since 2008, according to the report: We expect this trend to continue in 2016, due to lower production at more mature operations and a lack of new mines coming on stream. We currently forecast global mine output to shrink in 2016, marking the first annual decline since 2008 and the largest in percentage terms since 2004.” This confirms statements by mining company off...
S&P 500 The S&P 500 initially tried to rally during the course of the day on Wednesday but found the 1920 level to be a bit too resistive. The Federal Reserve had its FOMC Statement come out during the course of the day, and this ended up turning the market around completely as the Federal Reserve looks to the global economy to make its next decision. However, they also stated that they fully intend on raising interest rates gradually as economic conditions allow. At this point though, I see quite a bit of support below, so I think it would not be a huge surprise to see some type of supportive candle between here and the 1820 handle. ...
Note: The NYSE has released new data for margin debt, now available through December. We’ve updated the charts in this commentary to include the latest numbers. The New York Stock Exchange publishes end-of-month data for margin debt on the NYXdata website, where we can also find historical data back to 1959. Let’s examine the numbers and study the relationship between margin debt and the market, using the S&P 500 as the surrogate for the latter. The first chart shows the two series in real terms — adjusted for inflation to today’s dollar using the Consumer Price Index as the deflator. At the 1995 start date, we were ...
Celgene Corporation (CELG – Analyst Report) a leading biopharmaceutical company engaged in the discovery, development and commercialization of drugs targeting cancer and immune/inflammatory diseases. The Summit, NJ based company is well known for Revlimid and oncology products like Vidaza, Istodax, Abraxane, Pomalyst and Thalomid. However, like many of its peers, Celgene is facing generic competition for several of the important products including Vidaza. In this scenario, investor focus remains on the performance of key products like Revlimid as well as recently approved products like Otezla. Celgene is also looking to expand Revlim...
Nucor (NUE) has increased its dividend for 43 consecutive years – every year since it first began paying dividends in 1973. For a company operating in the often-challenging steel market, such consistency is remarkable. The stock also offers the fifth highest dividend yield (4.2%) out of all the dividend aristocrats, perhaps making it an interesting candidate for income investors to consider. While the stock is not in our Top 20 Dividend Stocks portfolio today, the company possesses several competitive advantages that dividend growth investors should be aware of. Business Overview NUE manufactures steel products in the U.S. and Canada ...