GM Cans Mid-Size Trucks; Treasury Yields Soar to 7-month High; Airlines Grounded by $9 Billion Loss; Copper Sinks as Dollar Rises; Supreme Court Delays Chrysler Sale; McDonald’s misses estimates; Apple debuts new iPhone
Quote of the week: I stopped believing in Santa Claus when I was six. Mother took me to see him in a department store and he asked for my autograph. – Shirley Temple
Here are eight stocking stuffers to unwrap.
The Boeing Co. (BA) may further delay first deliveries of its flagship 787 Dreamliner by at least six months – meaning the jet will enter service more than two years later than was originally projected – because of the recently concluded strike by union machinists and several other problems, The Wall Street Journal reported.
Airline stocks are enjoying a sharp upswing today. The industry is recovering strongly as fuel prices tumble. And investors are also encouraged by the Delta (NYSE:DAL) and Northwest (NYSE:NWA) merger. But Andrew Snyder says this remains a high-risk sector for stock investors.
According to a recent article in Barron’s, now is a good time to sell airline stocks.
So far this year, 25 airlines have collapsed. Those that have survived have taken on hefty losses. The seven biggest US carriers had combined 2Q losses of almost $6 billion.
Nevertheless, over the last month the AMEX Airline Index (XAL) rallied as the price of crude oil fell. This trend will be short lived says Rick Pendergraft in Investor’s Daily Edge. A reversal of fortunes for the dollar and for oil will send airline stocks back down again soon…
The airline industry has been one of the hardest hit by this summer’s run-up in crude oil prices.
British Airways (LON:BAY) CEO Willie Walsh says it’s “the worst trading environment the industry has ever faced.”
But crude oil’s retreat from its early-July peak has led investors back into the industry, says Martin Denholm in The Smart Profits Report.
And Martin’s colleague Marc Lichtenfeld has given potential investors two stocks to watch should the uptrend continue. Here’s more from Martin…
After hitting a seven-week low yesterday, crude oil prices began to rise today.
Crude oil for September delivery rose $1.14 to $125.58 a barrel at the 2:30 p.m. close of floor trading on the Nymex.
Much of the recent drop in oil prices is due to the rally in financials, says Byron King. But the black goo is still double the price it was two years ago. Worse still, the US is now coping with chronic inflation. Precious metals are the best way to your savings and purchasing power…
The airline industry is facing a major crisis.
The price of fuel now makes up 35 percent of airline costs compared with 13 percent a decade ago. Capital and Crisis editor Chris Mayer says if oil prices stay where they are and nothing else changes, the airline industry will lose about $6 billion this year, compared with a profit of $5.6 billion last year.
This creates a great ‘hidden’ opportunity for investors. More fuel-efficient engines will require the use of exotic metals that can cope with higher-then-normal engine temperatures – metals like cobalt…
What a difference a year makes. Delta Airlines (DAL) has reported a 2Q loss of $1.04 billion, compared with year-ago net income of $1.59 billion. Sky-high crude oil prices and fuel inefficient planes are murdering the airline.
A great way to play the airlines woes is by investing in vanadium. The little-known metal is in high demand due its use in fuel-efficient engine technology. Its primary use is in ultra-light, super-strong metal alloys.
Vanadium is scarce. And there’s high demand for it. This makes it a great investment, says Chris Mayer…
Editor’s Note: Here’s a real contrarian play: Eric Roseman, Investment Director of Sovereign Society, says airline stocks are primed to offer major profit returns in the near future.
The airline industry has been battered by the surge in oil prices. Major companies have already cut services, raised fees, and announced job losses. And share prices have collapsed since the start of the year: United Airlines (UAUA) is down a whopping 84.6%, Delta Airlines (DAL) 64.8%, Continental (CAL) 48.7% and Northwest (NWA) 58.9%.