Monthly Archives: April 2017

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Keep Your Eyes On Copper’s Trading Range

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After President Trump’s election win in November, copper and other base metals surged higher due to excitement about infrastructure projects promised during the election campaign. Since then, prices have settled into a trading range as these promised infrastructure projects get pushed further into the future than originally expected.

Though copper has lost some of the momentum it had at the end of last year, the uptrend is still intact. Copper is currently trading in a range between its $2.50/pound support level and $2.80/pound resistance level. One of these levels must be broken to signal the start of the next major directional move. As long as copper remains above the $2.50/pound support, it has a neutral to positive bias. In addition, the commercial copper futures hedgers (who are often considered to be “smart money”) have pared back the large short position they had from November to February and are now neutrally positioned. If the commercial hedgers build a long position, it would increase the chances of an upside breakout from the current trading range.

Daily copper chart

Finviz.com

Daily copper chart

Source: Finviz.com

The long-term chart shows how copper broke above its well-established downtrend line, which is a positive sign in and of itself. Copper’s next major challenge is to break above the $3/pound resistance level. From this perspective, copper’s technicals are neutral as it treads water between its former downtrend line and $3/pound resistance level.

Weekly copper chart

Finviz.com

Weekly copper chart

Source: Finviz.com

The U.S. dollar is an important influence on the price of copper and other commodities. Bullish moves in the dollar are bearish for copper and vice versa. The dollar surged after the U.S. Presidential election, but has recently pulled back because hard economic data has been coming in soft and because President Trump tried to verbally intervene by saying that the dollar is “getting too strong.” The dollar’s recent weakness has helped to support copper. From a technical perspective, the U.S. Dollar Index is struggling to break above its 100 resistance level. A solid breakout above this level (likely combined with strong U.S. data and hawkish Fed action) is necessary to signal a bullish dollar move from here. 

Monthly dollar chart

Finviz.com

Monthly dollar chart

Source: Finviz.com

 





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How The Biggest U.S. Companies Have Changed Over A Decade

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My 2014 Best Performers, Looking Ahead To 2015

The five biggest U.S. companies based on market cap are all technology stocks. But going back ten years reveals a completely different story.

Today, the five biggest companies are as follows:

These are all high-tech companies not only investing billions of dollars in current high-tech initiatives such as cloud and voice assistant products but also investing billions more in next-generation technologies including self-driving cars, artificial and virtual intelligence. Even Amazon’s ambitious longer-term goal is to operate a floating or flying warehouse at 45,000 feet in the air.

2006 Vs. 2016: The Tech Scene Emerges

Back in 2006, few if any people knew what the cloud was, and Amazon’s Prime program had just launched a year prior with hardly any of the perks it comes with today.

For that reason, the biggest companies by market cap in 2006 were a handful of consumer good companies, energy companies and banks. After all, the iPhone hasn’t even been released yet, oil was trading higher than versus today and the economic collapse hasn’t been fully felt yet among Wall Street banks.

Here are the biggest U.S. companies by market cap in 2006:

Related Links:

See more from Benzinga






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Apple’s Cash Hoard Set to Top $250 Billion

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Year-To-Date Winners: We Have Found The Market And It's Apple

APPLE – THE BEST OPPORTUNITY EVER?

I SEE APPLE GOING BACK ABOVE $300, SOONER RATHER THAN LATER

Apple Inc. is expected to report Tuesday that its stockpile of cash has topped a quarter of a trillion dollars, an unrivaled corporate hoard that is greater than the market value of both Wal-Mart Stores Inc. and Procter & Gamble Co. and exceeds the combined foreign-currency reserves held by the U.K. and Canada combined. The money, more than 90% of which is stockpiled outside of the U.S., ​has drawn fresh attention as President Donald Trump has proposed slashing business taxes and a one-time tax holiday on corporate cash brought home. Apple’s quarterly results will show the company has doubled its cash pile in just over 4½ years.






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Here's why earnings are so outstanding even though the US economy is barely growing

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So far this earnings season, the less a U.S. company is exposed to America, the better its results.






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Here’s why earnings are so outstanding even while the US economy is barely growing

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So far this earnings season, the less a U.S. company is exposed to America, the better its results.

S&P 500 companies which generate more than half their revenue overseas are posting first quarter earnings growth of 19.9 percent, on average, double that of companies that conduct a majority of their business domestically, according to FactSet. About 60 percent of the S&P 500 has reported results.

That helps explain the gap between the strong quarterly results and sluggish economic data like Friday’s report showing U.S. GDP increased at just 0.7 percent in the first quarter, its slowest pace in three years. In fact, CNBC analysis found that the difference between earnings per share growth and gross domestic product expansion in the first quarter is the widest since the third period of 2011.

“We’re seeing some pickup in growth that’s outside the U.S. that’s being reflected in these earnings numbers,” said Nick Raich, CEO of The Earnings Scout, pointing out that “the U.S. data is domestic focused.”

About 46 percent of S&P 500 sales overall come from foreign markets.

The U.S. is still the world’s largest economy, but its growth has stagnated while that of the rest of the world has been picking up.

In April, the International Monetary Fund raised its annual growth forecasts for China and the euro area by 0.1 percent from its report in January. The estimate for the U.S. economy was unchanged.

The IMF raised estimates for Japan and the U.K. by 0.4 percent and 0.5 percent, respectively, for an estimated overall 0.1 percent uptick in global growth this year. This time last year, the IMF had cut its global growth outlook by 0.2 percent.

Key reasons for last year’s sluggishness was a plunge in oil prices and other commodities prices, that added to the struggles of China as it attempts to transition its economy away from manufacturing exports to developing its services industry.

As a result, major U.S. firms dependent on China and commodities markets have surprised in the first quarter of this year.

For example, Caterpillar crushed earnings estimates and posted its first year-over-year sales increase in more than two years. The Dow component’s Asia Pacific sales rose 12 percent “primarily due to an increase in construction equipment sales in China resulting from increased infrastructure and residential investment,” according to a release.

In the first quarter of last year, Caterpillar’s Asia Pacific sales dropped 23 percent.

U.S. banks have also posted strong first-quarter earnings, helped by rising interest rates, improving global growth and increased trading revenues. Bank of America, JPMorgan Chase and Morgan Stanley reported large earnings beats that contributed substantially to the S&P 500’s earnings growth in the first quarter, according to FactSet’s Butters.

Overall S&P 500 earnings per share growth is on track for an increase of more than 12 percent for the first quarter, the greatest since the third quarter of 2011.

Other factors helping earnings and overseas economic growth are softness in the U.S. dollar and stabilizing oil prices.

The greenback has traded mostly lower this year after sharp gains in 2014 and 2015 that cut into overseas profits.

Meanwhile, oil recovered from a low below $30 a barrel hit last February to trade in a range near $50 a barrel. U.S. crude is up about 7 percent over the last 12 months.

To be sure, there’s another reason why earnings look so good: A year ago, they were pretty bad.

Last year’s poor results for S&P 500 companies overall, including four straight quarters of earnings decline, set a low bar for companies to overcome. Matching improved growth in coming months may be more difficult.

But they continue to grow at a healthy pace with help from the globe.

“We have been more focused on improving global growth than on the ‘Trump trade,'” hedge fund manager Dan Loeb, who’s doubled the market’s return over the last two decades, told clients in a Thursday letter obtained by CNBC.

“Although S&P earnings were flat over the past three years,” the Third Point manager said, “we are expecting earnings growth to drive gains and cyclical names to get a tailwind from U.S. policy shifts this year.”

— CNBC’s Scott Wapner and John Melloy contributed to this report.






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Foxconn in investment talks with US

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Year-To-Date Winners: We Have Found The Market And It's Apple

APPLE – THE BEST OPPORTUNITY EVER?

I SEE APPLE GOING BACK ABOVE $300, SOONER RATHER THAN LATER

The Taiwanese electronics giant has said it’s looking to expand in the US.






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[$$] Apple Still Has Room to Grow

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Year-To-Date Winners: We Have Found The Market And It's Apple

APPLE – THE BEST OPPORTUNITY EVER?

I SEE APPLE GOING BACK ABOVE $300, SOONER RATHER THAN LATER

Apple’s shares are expected to continue rallying ahead of the release of the highly anticipated new iPhone later this year.






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[$$] Yahoo CEO Marissa Mayer Earned $27.4 Million Last Year

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Yahoo Inc. Chief Executive Marissa Mayer’s compensation totaled $27.4 million last year, a package mostly unaffected by a deal to sell Yahoo’s core business to Verizon Communications Inc. or two large …






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[$$] Apple’s Cash Hoard Set to Top $250 Billion

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Year-To-Date Winners: We Have Found The Market And It's Apple

APPLE – THE BEST OPPORTUNITY EVER?

I SEE APPLE GOING BACK ABOVE $300, SOONER RATHER THAN LATER

Apple likely will report Tuesday that its cash hoard has topped a quarter of a trillion dollars—an unrivalled milestone that could ratchet up pressure on the tech giant to make splashier acquisitions or …






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Stock Futures Steady: Can AMD, Apple Boost Chip Plays?

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Year-To-Date Winners: We Have Found The Market And It's Apple

APPLE – THE BEST OPPORTUNITY EVER?

I SEE APPLE GOING BACK ABOVE $300, SOONER RATHER THAN LATER

XAutoplay: On | Off

Futures for the Dow Jones industrial average, S&P 500 index and Nasdaq 100 were little changed Sunday afternoon following strong market gains last week. Investors will get a key reading on the U.S. economy Monday, with earnings from Advanced Micro Devices (AMD) on tap following Friday’s selloff in chip stocks.

Last week the Nasdaq composite rose 2.3%, its best showing since January, with the tech-heavy index hitting record highs. The S&P 500 index climbed 1.5% and the Dow Jones industrial average 1.9%, both close to all-time levels.

Futures for the Dow industrials fell a fraction vs. fair value. So did S&P 500 index and Nasdaq 100 futures.

Advanced Micro Devices

Advanced Micro Devices is one of a handful of earnings reports on Monday, ahead of Tuesday, when Apple (AAPL), Mastercard (MA), Papa John’s (PZZA), a pair of fiber-optic plays and dozens more release quarterly earnings.

AMD is expected to report a 4-cent per-share loss after Monday’s market close, narrowing vs. a 12-cent loss a year earlier. Revenue should climb 18% to $984.38 million. For the full year, AMD is expected to turn an 8-cent profit vs. a 14-cent loss a year ago.


IBD’S TAKE: All-time winning stocks tend to have Composite Ratings of 95 or more near the start of big price moves. Here are the five “top 5%” stocks with earnings due this week.


AMD shares have been trying to get above their 50-day moving average, moving above that key support intraday on Thursday and Friday but turning back, falling 2.3% to 13.30 in Friday stock market trading.

AMD is working on a double-bottom base. A double-bottom pattern is a “W”-shaped consolidation in which the second leg of the W undercuts that first. As a result, AMD has a potential buy point at 14.85, jut above the center of the “W.”

AMD’s chips are used for PC gaming graphics as well as new AI uses. Its results and guidance may offer clues for rival Nvidia (NVDA), which reports on May 9. Nvidia

AMD and Nvidia have similar-looking chart patterns at first glance. But there is a key difference. In Nvidia’s case, the second leg of the “W” did not quite undercut the intraday low of the first leg. That means it did not shake out as many weak holders as AMD’s true double-bottom. Thus, Nvidia’s potential buy point for now is 121.02, just above the old high. Nvidia’s stock has moved just above its 50-day line.

AMD’s report also will key for the chip sector, which has been a leading group but faltered at the end of last week. Intel (INTC), which just missed on sales late Thursday, fell 3.4%. But Apple chip supplier Skyworks Solutions (SWKS) and chip-gear maker KLA-Tencor (KLAC) sank 4.3% and 5.2% despite better-than-expected profits and sales.

Skyworks dragged down other Apple iPhone chipmakers, including Qorvo (QRVO), which fell 4.3%. Qorvo technically fell back into buy range but the heavy-volume decline to just below the 50-day line raises concerns. Qorvo reports earnings Wednesday.

For iPhone chipmakers generally, Apple earnings late Tuesday may be the big mover. Expect another quarter of slim profit and sales growth. Investors are betting on strong demand for the upcoming iPhone 8, and perhaps new buybacks and higher dividends from Apple’s huge cash pile.

Manufacturing Index

The Institute for Supply Management will release its April manufacturing survey at 10 a.m. ET. Economists expect a slight dip to 56.5 from March’s 57.2. However, the ISM index has topped the Econoday forecast for seven straight months. Even an in-line reading would be well above the neutral 50 level.

On Wednesday, the Federal Reserve will wrap up its two-day policy meeting. Economists don’t expect any change in policy, but the central bank’s statement could offer clues about future meetings. The odds of a Fed rate hike by the June meeting are now at 63%.

On Friday, the Labor Department will release its April employment report.

RELATED:

The Big Picture: This Key Tech Sector Falters

This Is Why You Should Consider Amazon, Netflix, Alibaba For Your Portfolio

Which Companies Are Now Outperforming 95% Of All Stocks?

Apple, Tesla, Facebook, Fed To Grab Spotlight: Investing Action Plan






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