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Thursday, March 21, 2013

Industrial metals

It is not just copper headed south lately.  Check out these other charts.






All these industrial metals bottomed mid year in 2012.  There was a slight upturn in the global economy and world stock markets rallied on that.  Every single one of these charts has seen some serious down side over the last few weeks.  I don't see how anybody can make the argument today that the global economy is getting stronger.  I thought this was interesting about CAT (Source). 

Global retail sales for Caterpillar declined 13% on a 3-month rolling basis, partially from shrinking inventories, but also due to a dramatic slowdown in Asian and North American purchases.

I think the global economy is slowing again and earnings will be affected.  Will it just be a first half slow down like last year or will it last longer?  How much longer will it be before stocks are affected by the slow down?  That will likely depend on what happens with earnings coming up.  If FDX and ORCL are any indication it might not be long.


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