Goldman’s Reversal on Commodities in 2009 Caps a Bipolar Year; Caterpillar Cut to Sell (CAT)
Goldman has gone from from permabull (remember the $200 oil “super-spike” call from May?) to permabear in less than one year’s time. Earlier this year the call was for an average spot price for crude between $110-$120 through 2011; today the 2009 average spot was pegged at $45. In conjunction, Goldman is slashing estimates for [...]
A Critical Day Approaches for Commodities; A Look at Wheat, Aluminum, Copper (AA, FCX, POT)
In addition to the disappointing close in the U.S. equity markets yesterday, there was also a renewed breakdown in the prices of many commodities. Due to their leverage as catalysts to Potash Corp (POT), Alcoa (AA), and Freeport-McMoRan (FCX), I’m focusing in on wheat, aluminum, and copper.
Wheat
After forming a solid bottom around the $500 [...]
Freeport-McMoRan Suspends Dividend; Slashes Targets (FCX)
Copper, gold, and molybdenum producer Freeport-McMoRan (FCX) has released a cast iron, kitchen sink of a statement this morning, announcing the suspension of the $2/share annual dividend and a 50% cut in 2009 capital expenditures, along with volume cuts for copper and moly covering the next two years.
The moves come in response to rapidly falling [...]
Copper Futures up 8% Despite High Inventories; Freeport Rallies (FCX)
Shares of the world’s largest publicly-traded copper miner Freeport-McMoRan (FCX) are up over 10% as copper futures have made it all the way back to just below $2 (currently $1.98); the December contracts were trading at $1.80 just yesterday on the back of the London Metal Exchange (LME) reporting that copper inventories were the highest [...]
Where Did the Sellers Go Today?
I was getting ready to put a title on this post that read “The Least Gratifying 10% Move Ever?”…but at the last minute, after reading all my notes, I looked past my cynicism. Not that there’s anything wrong with being cynical in this market - if I was a financial doctor, I would prescribe cynicism [...]
Performance Update: A Portfolio Divided, and 2 Dilemmas
The Secular Trends Model Portfolio briefly dipped below $80k before finishing the day at $804k…Currently the losses on the 6 worst holdings by performance (AA, FCX, POT, BTU, CAT, PBR) have been severe enough to destroy most of the little tidbits of alpha I was picking up on the other 16 positions. Basic Materials and [...]
Buying Short-Term Position in Freeport (FCX)
Severe times call for inventive measures to gain returns. With today’s 15% drop Freeport-McMoRan (FCX) now yields over 5%, and on (sic) fundamentals the stock is even more attractive. Even though gold production has been low in recent years, this part of Freeport’s business should serve as a hedge against copper prices.
I’m going to stick [...]
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