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Minyanville's Before The Bell: Shipping In Demand, but Global Markets Down


Global bears are out in force. Shipping may be a hiding spot for Hoofy. US futures are weak this morning.


Morning Perspective: Ship It Good!

As the cost of commodities increase, so has the cost of transporting them. A story in the WSJ reports the average price of renting a ship to carry raw materials from Brazil to China has tripled from $65K to $180K in only a year. Professor Markman first mentioned this idea in Agean Marine Petroleum.

The Bull Pen: Popular plays in the shippers are in Dry Ships (DRYS) and Agean Marine (ANW). Traders looking to go long may set sell-stops near recent support levels at $111 and $42 respectively.

Bear Cave : Shipping plays may be gaining too much attention. Traders in that boat may look to Excel Maritime Carriers (EXM) as a short play with stops above recent highs at $82.

Rally Yen!

The Japanese Yen rose to a six-week high against the dollar in addition to rising against 16 of the world's most actively traded currencies. The strength comes as members of the G-7 summit said the slowing economy will curb global growth. Read Professor Shedlock's What Factors Are Affecting The U.S. Dollar? and Mr. Practical's Minyan Mailbag, How Dollar Debt Could Play Out.

The Bull Pen: The Japanese Yen ETF (FXY) may serve as a good play if global growth continue to slow. Traders can define their risk below $86.30 (50-day) or $85 (recent support). Professor Kevin Depew notes that 84 would break a double bottom on a point and figure chart and violate the trend line from the June lows.

Bear Cave : f the belief is the dollar's weakness is overdone, then consider the PowerShares DB US Dollar Index Bullish Fund (UUP). A move to 25.25 would break a double top (buy signal) on a point and figure chart.

Click on Minyanville's Stocks To Watch for more company-specific ideas.

A Quick Check Around the World

Asian markets closed mostly in the red. The Hang Seng fell -3.70%, the Nikkei fell -2.24%, fell -2.61%, and
Shanghai fell -2.59%.

Europe , the DAX is down -1.39%, FTSE is down -1.61%, and the CAC is lower by -1.88%. As of 8:00 AM EST, S&P Futures are down by 12.5 points and Nasdaq futures are down by 18 points.

A Look At Commodities

Commodities are weaker. Crude is lower by -1.15 to 85.80. Gold is down by -13.4 to 754.80. Silver is lower by -0.23 to 13.40 and copper is down by -0.0725 to 3.47.

On the Radar

We have a light radar this morning with no economic events scheduled. Here are some notables as we progress into earnings season.

Before Market Open:

  • Haliburton (Hal) reports $0.66 EPS vs. $0.69 cons. Revenues came in at $3.928 bln vs. $4.041 bln cons.
  • Hasbro (HAS) reports $0.78 EPS vs. $0.71 cons. Revenues came in at $1.22 bln vs. $1.14 bln cons.
  • JAKKS Pacific (JAKK) reports $1.45 EPS vs. $1.30. Revenues came in at $318.4 mln vs. $300.8 mln cons.

After Market Close:

  • American Express (AXP): $0.85 EPS; $7.31 bln revenues
  • Apple (AAPL): $0.83 EPS; $6.01 bln revenues
  • Netflix(NFLX): $0.18 EPS; $286 mln revenues
  • Texas Instruments (TXN): $0.50 EPS; $3.65 bln revenues

Click here for the full Minyanville Trading Radar.

Happy Monday, Minyans! Good luck and have a great day!

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No positions in stocks mentioned.

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