The Red Roadmaster’s US Market Re-cap + Stock Talk ™
19 February 2010
Date Line: Bangkok, Thailand
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Red’s Bull Alert: Broad-based buying sent the DJIA and the NAS North to close above their 50 DMA's for the 1st time in about one month, but the S&P 500 met resistance at the Key technical level.
Re-cap of the US Stock Market Action for the session ending 3 February 2010 US stocks rose for the 3 day running Thursday The DJIA gained 83.66 pts, or 0.81%, to close at 10,392.90, the S&P 500 rose 7.24 pts, or 0.66%, to close at 1,106.75, and the NAS tallied up a + 15.42 pts, or 0.69%, to end the session at 2,241.71. The Big Q: Is the Cheap Money faucet off at the US Federal Reserve? The Big A: Perhaps… After the Bell Thursday the US Federal Reserve announced it was raising the discount rate charged banks for emergency loans. Investor Banks have relied heavily on near Zero interest rates, and have invested that low interest money into riskier investments, i.e., equities and commodities that yield high returns. The move, a signal the US economy is on the right track, maybe marks a retreat from the easy money policy. From my POV this is unusual timing for such a move, in that the this is Options Expiration Friday, and will likely create a lot of weeping and gnashing of teeth + may put a Bearish damper on a pretty good market week. Bank stocks may take the hit and fall. The Select Sector SPDR Financial fund fell 1% after the Fed news yesterday. The S&P 500 futures fell 9.7 pts about 5p on the news, the DJIA futures lost 68 pts, and the NAS 100 futures lost 13 pts on the News. Volume and Breadth: trade of about 7.24B/shrs transacted on the NYSE, American Stock Exchange, and the NAS, significantly below last year's estimated daily average of 9.65B/shrs. Advancers outnumbered decliners on the NYSE by 9 to 4, and on the NAS about 7 stocks rose for every 5 that fell. Stocks to Watch Today Barrick Gold Corporation (ABX), Freeport-McMoRan (FCX), First Solar, Inc. (FSLR) and IBM
Barrick Gold Corporation (ABX) Up-Date 6
Last Look: January 7, 2010
February 19, 2010 Paul A. Ebeling, Jnr. Analyst Today, let’s look at Barrick Gold Corporation (ABX), the Golden name in the world’s Gold mining sector: from a Technical POV. The overall indications, after Thursday’s (February 18) market action, are: Neutral, near term Neutral, mid-term Neutral, and long term Bearish. The recent Candle Stick analysis is: Very Bullish
** Chart by: http://www.stockta.com
Latest News and Opinion: Barrick to Spin Off 4 African Gold Mines http://dealbook.blogs.nytimes.com/2010/02/18/barrick-to-spin-off-4-african-gold-mines/? partner=yahoofinance
Thursday’s Market Action
There is a Bullish Harami on February 18, and one Gap open up on February 16 at: 36.83/37.36, support at 38.74, resistance at 40.71 and the 50 day exponential moving average is 38.21. This is Barrick Gold Corporation: In the world of mining, Barrick Gold is the Gold Standard. The company became the world's One # One Gold producer, ahead of Newmont Mining and AngloGold Ashanti, after acquiring Placer Dome in 2006. Barrick puts out 8MM ozs of Gold annually and has 125MM ozs in proven and probable reserves. About ½ of its production comes from the North American operations, which include Goldstrike, located in Nevada's Carlin Trend Gold producing region. Outside of North America Barrick has active projects in Tanzania, Peru, and Australia. On the Placer Dome acquisition came huge copper mining operations that brought Barrick more than 6B Lbs of Copper reserves. Note: In the metals mining sector demand is driven by industrial demand and economic growth, both domestic and foreign. A company’s profitability depends on volume and efficient operations. Large companies like Barrick can afford to discover and develop new deposits and increase reserves. Small companies typically own just one mine, limit exploration to that one property, and operate it as efficiently as possible. Gold mining today is highly automated; annual revenue per employee is approx. US$30 Gold and Politics On August 15, 1971, US President, Richard Nixon unilaterally canceled the Bretton Woods system and stopped the direct convertibility of the United States dollar to gold. As a result, the U.S. dollar was decoupled from Gold, and Gold prices could fluctuate like any other commodity. The data is limited when comparing the performance of Gold prices as they relate to the political affiliation of the President of the United States. There are some striking similarities between the performance of Gold prices during the great Gold Bull Market of the 1970s and today's Gold Bull Market and how the Presidential political affiliation was and is tilted. When Barack Obama, was elected the 44th President of the United States of America, some Gold Bugs became extremely happy because the biggest Gold Bull Market in modern history peaked during a political landscape that is similar to what we see today. Barrick Gold Corporation (HQ) Peter Munk, Chairman and acting CEO Brookfield Place, TD Canada Trust Tower, 161 Bay St., Ste. 3700 Toronto, Ontario M5J 2S1, Canada Phone: 416-861-9911 Fax: 416-861-2492 Toll Free: 800-720-7415 www.barrick.com
Freeport-McMoRan Copper & Gold Inc. (FCX) Up-date 20
February 2, 2010 February 19, 2010 Paul A. Ebeling, Jnr. Analyst Today, let’s look at Freeport-McMoRan (FCX), the giant Gold and Copper miner, from a Technical POV. The overall indications, after Thursday’s (February 18) market action, are Neutral: in the near term Neutral, mid-term Neutral, and long term Neutral. The recent Candle Stick analysis is: Bullish.
**Chart by: http://www.stockta.com
Latest News and Opinion: Gold Prices Mixed http://www.thestreet.com/_yahoo/story/10684340/1/gold-prices-slip.html? cm_ven=YAHOO&cm_cat=FREE&cm_ite=NA
Thursdayâ€™s Market Action
There is a Bullish Engulfing Candle on February 18, and two Gaps open up between September 3, 2009 and February 16, 2010 at 62.24/74.85, the near term resistance is 78.28, support at 74.76, and the 50 day (EMA) exponential moving average is 76.37. This is Freeport-McMoRan (FCX): Freeport-McMoRan Copper & Gold, Inc. engages in the exploration, mining, and production of mineral properties primarily in Indonesia, North America, South America, and Africa. It focuses on the copper, gold, molybdenum, and silver prospects. The company holds interests in the Grasberg open pit and Deep Ore Zone projects in Indonesia. It also owns interests in the Grasberg, Kucing Liar, Mill Level Zone/Deep Mill Level Zone, and Big Gossan projects in Indonesia. In addition, the company holds interests in the Morenci project in Greenlee County, Arizona; the Safford project in Graham County, Arizona; the Bagdad project in Yavapai County in west-central, Arizona; the Sierrita project in Pima County, Arizona; the Miami project in Gila County, Arizona; the Chino and Tyrone project in southwestern New Mexico in Grant County; the Henderson project located approximately 42 miles west of Denver, Colorado; and the Climax molybdenum mine in Colorado, which are located in North America. Further, it owns interests in the Cerro Verde project located 20 miles southwest of Arequipa, Peru; the Candelaria project situated approximately 12 miles south of Copiapo in northern Chiles Atacama province; the Ojos del Salado project located approximately 10 miles east of Copiapo in northern Chiles Atacama province; the El Abra project situated 47 miles north of Calama in Chiles El Loa province, which are located in South America. Additionally, the company holds interests in the Tenke Fungurume project in the Democratic Republic of Congo; and the Atlantic Copper project in Huelva, Spain. At December 31, 2007, it had total consolidated recoverable proven and probable reserves of approximately 93.2 billion pounds of copper; 41.0 million ounces of gold; 2.0 billion pounds of molybdenum; 230.9 million ounces of silver; and 0.6 billion pounds of cobalt.
The Competitive Landscape Demand is driven by industrial demand and economic growth, both domestic and foreign. Individual company profitability depends on volume and operating efficiency. Large companies can afford to discover and develop new deposits and increase reserves. Small companies typically own just one mine, limit exploration to that one property, and operate it as efficiently as possible. Metal ore mining is highly automated: annual revenue per employee is about US$300,000. Metal Ore Mining Industry Forecast The output of US metal mining is forecast to grow at an annual compounded rate of 5.4 % between 2008 and 2013.
Freeport-McMoRan (HQ) Chief Exec. Officer, Pres Richard C. Adkerson One North Central Avenue Phoenix, AZ 85004-4414 United States Phone: 602-366-8100 http://www.fcx.com
Freeport-McMoRan Subsidiaries Atlantic Copper, S.A., Chino Mines Company and Climax Molybdenum Company
First Solar, Inc. (FSLR) Up-date 4
Last Look: December 8, 2009
February 19, 2010 Paul A. Ebeling, Jnr. Analyst Today letâ€™s look at First Solar, Inc. (FSLR), the developer and maker of photovoltaic (PV) cells, from a Technical POV. The overall indications, after Thursdayâ€™s (February 18) market action, are Neutral: in the near term Neutral, mid-term Neutral, and long term Neutral. The recent Candle Stick analysis is: Neutral
**Chart by: http://www.stockta.com
Latest News and Opinion: First Solar Q-4 profits slightly higher
Thursdayâ€™s Market Action Close 126.29 + 2.07
There is one Gaps open up on February 16 at 115.9/116.04, the near term resistance is 127.09, support at 1125.16, and the 50 day (EMA) exponential moving average is 123.62. This is First Solar, Inc. (FSLR): The Company designs, manufactures, and sells solar electric power modules using a proprietary thin film semiconductor technology. The companyâ€™s solar modules employ a thin layer of cadmium telluride semiconductor material to convert sunlight into electricity. It sells its products to project developers, system integrators, and operators of renewable energy projects primarily in Europe. First Solar also focuses on designing and deploying commercial solar projects for utilities in the United States. The company was founded in 1999. It was formerly known as First Solar Holdings, LLC, and changed its name to First Solar Holdings, Inc. and subsequently to First Solar, Inc. in 2006. The company is headquartered in Tempe, Arizona .
Industries Where First Solar Competes Electronics Electrical Products Power Generation & Storage (primary)
First Solar, Inc. (HQ) Chairman and Chief Exec. Officer; Michael J. Ahearn 350 West Washington Street Suite 600 Tempe, AZ 85281-1244 United States Phone: 602-414-9300 Fax: 602-414-9400 http://www.firstsolar.com
International Business Machines Corp (IBM) Up-date 12 Last Look: December 21, 2009 February 19, 2010
Paul A. Ebeling, Jnr. Analyst Today let’s look at “Big Blue”, International Business Machines Corporation (IBM), the World’s #1 provider of computer products and computer services, from a Technical POV. The overall indications, after Thursday’s (February 18) market action, are Neutral: in the near term Neutral, mid-term Neutral, and long term Neutral. The recent Candle Stick analysis is: Bearish
**Chart by: http://www.stockta.com
Latest News and Opinion: IBM Awarded Contract to Modernize the U.S. Government's Acquisition and Procurement System http://finance.yahoo.com/news/IBM-Awarded-Contract-to-prnews-1341478277.html?x=0 Thursday’s Market Action Close 127.81 + 1.48 Volume 5,526,700/shrs There a Hammer on February 16, and one Gap open up on February 16 at 124.05/124.11, the near term resistance is 128.62, support at 126.61 and the 50 day (EMA) exponential moving average is 126.51. This is IBM (IBM): “Big Blue” is the world's top provider of computer products and services. IBM is a leader in every market in which it competes, the company makes mainframes and servers, storage
systems, and peripherals. Though perhaps still best known for its hardware, IBM's growing services business now accounts for more than half of its sales. Its IT services arm is the largest in the world and the company is also one of the largest providers of software, ranking #2, behind Microsoft, and semiconductors. The Competitive Landscape Demand for IT services is driven by rapid technological advances, but spending for these expensive products depends on the health of the US economy. The profitability of companies in the industry depends on maintaining technical expertise and on good marketing. Small companies can compete effectively by specializing in market niches or by partnering with larger companies that want to offer a broad array of services. Only the large companies can provide outsourcing services to big corporate customers. Average annual revenue per employee is close to US$200,000. Information Technology Industry Forecast The output of US computer and data processing is forecast to grow at an annual compounded rate of 6.1% between 2008 and 2013. Data Sourced: December 2009 IBM (HQ) Chairman, President, and CEO Samuel J. Palmisano New Orchard Rd. Armonk, NY 10504 United States Phone: 914-499-1900 Toll Free: 800-426-4968 http://www.ibm.com IBM Subsidiaries Cognos ULC IBM Australia Limited IBM Canada Ltd. Disclaimer DO NOT BASE ANY INVESTMENT DECISION UPON ANY MATERIALS FOUND ON THIS WEBSITE OR IN OUR NEWSLETTERS. Red Roadmaster is not registered as a securities broker-dealer or an investment advisor either within the US Securities and Exchange Commission (the “SEC”) or with any state securities regulatory authority. We are neither licensed nor qualified to provide investment advice. The information contained on our website or in any of our newsletters should be viewed as commercial advertisement and is not intended to be investment advice. Any information found on our website, or in any of our newsletters is not provided to any particular individual with a view toward their individual circumstances. The information contained on our website, and in any newsletter we distribute, is not an offer to buy or sell securities. We distribute opinions, comments, and information free of charge exclusively to individuals who wish to receive them.
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