The first Dow component reported a solid fourth quarter with earnings coming in at 24 cents per share or a net profit of $258 million. Furthermore, Alcoa Inc. (NYSE: AA) is forecasting that global aluminum demand will grow at 12% in 2011 and the company is also optimistic on the United States. Why I like to view Alcoa as a barometer for the economy is that its business serves customers in many sectors such as automobiles, construction and consumer products just to name a few. Alcoa’s shares are off a bit in the after-hours session however the stock has moved up 50% or so in recent months so no surprise that the common is a little weaker after the report.
The after hours action is something to pay attention to as the reporting season continues. There is a strong possibility that when other companies do come out with their results, profit taking may occur and/or the earnings results may already be priced in (?)
Let’s see how Alcoa closes tomorrow to see if this trend continues. Tech titan Intel Corporation (NasdaqGS: INTC) is due to report their quarterly results on Thursday which should set up the Tech sector.
Have a great week.