What Caterpillar, DuPont, Freeport results
can tell commodities traders
By Myra P. Saefong
MarketWatch
Earnings season offers traders extra tools to gauge the outlook for commodities such gold and oil. For metals, the prognosis isn’t good.
“In many cases commodities-correlated companies are forced to manage their businesses in a reactionary way to the changes in commodities prices,” said Justin McNichols, chief investment officer at San Francisco-based Osborne Partners Capital Management. But “there are cases when a company’s earnings are guidance that can provide clues to the future direction of commodities.”
Take Caterpillar Inc. +0.20% Quarterly results from the earth-moving equipment provider included drops in sales and profit and a slashed forecast, all resulting from weak demand from miners. Its shares went into a 6% tailspin on Wednesday.