Earnings Season Has Begun

As usual Alcoa(AA) has kicked off the earnings season.  Alcoa beat the street’s forecast for earnings per share for the second quarter with .13 per share against a .10 forecast.  They reported stronger volumes and, favorable currency and energy costs that more than offset lower aluminum prices. 

The statement that caught my eye was the raising of the consumption forecast for the full year from 10% to 12%.  I take the raising of the forecast as an expectation that the economy will show strength towards the end of the year.  This should be good news for many of the commodity stocks that we trade.  Also if the economy does show increased strength, it could lead to an upward trending market for the rest of the year. 

Today I will be watching many of the commodity stocks that we trade as they are showing some pre-market strength.  They have been beaten down recently so I will keep a close eye if buyers come into this sector on the long side.  Stocks like Cliffs Natural Resources(CLF), US Steel(X), Freeport-McMoran(FCX), and Newmont Mining(NEM) will be the stocks I will be watching to see if this sector is in play today.  Best of luck today with your trading. 

Kyle