There are plenty of shrills piling on the poor 1Q numbers by Joy Global this AM before the market opened. I have to wonder when the “masters of the obvious” will acknowledge that we didn’t learn anything new today from JOYG that we didn’t price in 3 months ago.
Coal and coal-producers have been hit hard over the past year as a glut of natural gas in North America drives utility switching, and slower growth in China threatens demand.
A combination of policy moves and a slowing economy have weakened the Brazilian real by 4.8% since the beginning of March, making it the worst performing currency tracked by Bloomberg. For exporters, this is a welcome change from the 8.7% appreciation in the first two months of the year, consequently making it the best-performing currency.
The boom-and-bust cycle in the shipping sector has far-reaching consequences. But even if the Chinese economy keeps pumping along, it may not entail bullish days ahead for steel stocks.
The price of coking coal has fallen up to 20% for the January-March quarter according to Indian government officials, reversing last year’s extreme strength in this key steelmaking commodity.
Banco Fator says the steel industry in Brazil and worldwide will have a slow recovery in 2012, affected by the crisis in Europe and deceleration of China’s economy. For this reason, they do not recommend the sector in the short and medium term.