Before The Bell: Less Steam, Less Oil; Coca-Cola KO
IEA lowers oil forecasts as U.S. economy slows; Coca-Cola knocks one out of the park.
WSJ reports the International Energy Agency cut its forecast for global oil demand in 2008 due to a slowing of the U.S. economy. Lawrence Eagles, head of the IEA's oil market division, said it revised downward its oil demand expectations in correlation with worldwide GDP forecasts. The IEA reduced this year's forecast for global demand by 200,000 barrels a day to 87.6 million a day, lowering the annual growth rate to 1.9%. In January, the organization had forecasted annual growth of 2.3%. For context on the slowing economy, read Professor Kevin Depew's Five Things You Need To Know.
From the Bull Pen: Bulls may look to other energy-related areas for upside plays such as Transocean (RIG). This driller recently broke out of a bullish pennant that began in mid January. Sell-stops may be set below $120.
From the Bear Cave: Bears see resistance in the oil ETF (USO) at $75. Buy-stops may be set above that level on any downside attempt.
Coca-Cola (KO) reported results for the fourth quarter this morning. The world's largest non-alcoholic soft drink company said earnings came in at $0.58 per share, $0.03 better than analyst estimates of $0.55. Revenues rose 23.6% for the year to $7.33 bln vs. $7.01 bln cons. due in part to strong sales in China and Mexico and profits from Vitaminwater in the U.S. Last year the company bought Glaceau Vitaminwater for $4.1 bln and the fourth quarter was the first full period selling the product, according to Bloomberg. Todd mentioned Coca-Cola recently in his article Five Reasons For Optimism.
From the Bull Pen: Todd mentioned KO as a likely candidate to outperform the markets. In addition, bulls are pleased with the company's efforts to diversify away from soft drinks. Sell-stops may be set below the 200-DMA ($57)
From the Bear Cave: Bears may attempt a downside play in PepsiCo (PEP) with sell-stops above the 100-DMA ($73.70).
For more ideas, see Minyanville's Spotlight Stocks.
Quick Check Around the World
The New York snow is washing away as quickly as it arrived this morning, while we find Asia mixed up and Europe in the red.
Asian trading closed with the Hang Seng +1.08%, Nikkei +0.36%, Sensex +2.05%, Taiwan -0.04% and Shanghai -2.37%.
A quick look towards Europe finds the CAC -0.41%, DAX -0.75%, FTSE -1.19%, ATX +0.19%, Swiss Mkt. -0.52% and Stockholm -1.42%.
A Look At Commodities
Commodities are lower this morning. Crude oil is down -0.20 to 92.58. Gold is lower -5.20 to 902.20. Silver is down -0.275 to 16.975, and copper is lower -6.60 to 348.90.
As of 8:45 AM EST, S&P futures are trading +10.60 points to 1360 and Nasdaq futures are higher +16.5 points to 1806.
On the Radar
MBA Mortgage Applications: -2.1% vs. 3.0% Prior
Advance Retail Sales: 0.3% vs. -0.3% cons.
Retail Sales less Autos: 0.3% vs. 0.2% cons.
10:00 Business Inventories: 0.4% cons.
Click here for Minyanville's full trading radar.
Happy Hump Day! Good luck!
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