The Alcoa Indicator: Majors Rise in After-Hours (BA, CAT, CENX, F, GE, TIE, X)

Posted in after-hours 
July 12th, 2010

Alcoa, Inc. is a stock that many investors and traders try to use as a proxy for earnings season for other major companies.  Of the companies which are large end-users of the metal (hence Alcoa’s comments about rising demand), we are watching Boeing Co. (NYSE: BA), Caterpillar Inc. (NYSE: CAT), Century Aluminum Co. (NASDAQ: CENX), Ford Motor Co. (NYSE: F), General Electric Co. (NYSE: GE), Titanium Metals Corporation (NYSE: TIE), and United States Steel Corp. (NYSE: X).  Of course not all of these are directly tied to Alcoa as far as the company itself, but the tie should be fairly evident.

The issue that always comes up for debate is that Alcoa is often a coincidental indicator rather than a leading indicator stock.  It is rare that things would be great or improving for Alcoa without the rest of the biggest companies following suit, but the rest of the universe can still be strong or holding up even if Alcoa is not scoring large gains.

Here are the after-hours reactions from the key DJIA components which would be loosely tied:

  • Boeing Co. (NYSE: BA) up 0.7% at $64.34
  • Caterpillar Inc. (NYSE: CAT) up 0.5% at $64.61
  • Century Aluminum Co. (NASDAQ: CENX) up 3.75% at $9.95
  • Ford Motor Co. (NYSE: F) up 1% at $11.21
  • General Electric Co. (NYSE: GE) up 1%at $15.08
  • Titanium Metals Corporation (NYSE: TIE) up 1.7% at $19.44
  • United States Steel Corp. (NYSE: X) up 1.35% at $42.07


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