Largest Sell off Since 2009! (CAT)(HPQ)(AA) 8/19/2011

Posted: August 19, 2011 in Agricultural Machinery, Aluminum, Construction, Precious Metals, Sell Off!, Technology
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This week added to its 3 week tear on sell offs and marked for the S&P’s largest sell off since March 2009. With global news being the biggest concern many are worried since the worlds largest banks have slashed economic growth forecasts.

Some of the S&P’s stocks of which were hit the hardest this week included

Alcoa Inc. (AA) since August 1st, has dropped from $14.75 to $11.23. Loss of $3.54 or close to a 24%

Hewlett-Packard Co. (HPQ) since August 1st, has dropped from $34.94 to $23.60. Loss of $11.34 close to a 32%

Caterpillar Inc (CAT) since August 1st, has dropped from $100.99 to $79.97. Loss of $21.02 close to 21%

Alcoa Inc. (AA) is talked to of fallen because of economic growth forecasts. With this being said this does not look great for Alcoa Inc. (AA) with the fact that 80% of their revenue is based solely on aluminum and alumina if their is a decline in the demand for these products this could hurt them. Personally I do not think their will be a Huge loss in the demand for (AA) Aluminum. With the fact that Alcoa Inc. (AA) operates in 31 countries if a few countries lower demand some of the other countries of which they have involvement with may increase demand which would balance it back out.

Hewlett-Packard Co. (HPQ) plunged 27% of the 34% just this week. This being the worst loss or drop for (HPQ) since October 1987 and the market crash. What caused all of this, their was talk of confidence, and a shift in strategy looking forward. Personally it may be investors catching on that the Cloud may rid of the Computer. It may also be their may be concerns of (HPQ) continuing to have flat numbers.

Caterpillar Inc. (CAT) also plunged because economic fear that the demand will not be there.  The fact is (CAT) has performed almost all predictions the this past year. There EPS was phenomenal, and Revenue Sky Rocketed. The reason I think there was such a large sell of was because there may be a bit of time before they hit those numbers again. This does not mean that they cannot or they are losing Market share because they are not. If anything I think Caterpillar (CAT) is in a wonderful position right now. I would not put it past (CAT) to still beat Analysis predictions even if the economy slows down for a bit. If anything this will give them opportunity to find more ways to stay in the forefront of this sector.

The sell off may continue for sometime however do not be discouraged overtime the stock market will reemerge not to mention. August 15th Warren Buffet made these comments

“I like buying on sale,” said Buffett, Berkshire’s chief executive officer. “Last Monday, we spent more money in the stock market buying than any day this year.”

Disclosure – Currently I do not hold a position in any of the above stocks, nor do I plan to hold a position within the next 3 trading days.

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Comments
  1. Scott says:

    Totally agree!

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