- Alcoa (NYSE:AA): +4.23% yesterday on average volume
- Freeport-McMoran Copper & Gold (NYSE:FCX): +2.89% on average volume
- Peabody Energy (NYSE:BTU): +2.41% on 2(x) average volume
- US Steel (NYSE:X): +3.77% on average volume
- Market Vectors Coal (ARCA:KOL), the coal ETF was up 2.47% on 2(x) average volume
- Market Vectors Steel (ARCA:SLX), the Steel ETF, +2.98% was up on heavier-than-average volume yesterday.
- S&P 500 +0.97% while SPDR Gold Trust (ARCA:GLD) and iShares Silver Trust (ARCA:SLV), were so-so.
Normally we don’t put out a note like this to readers, but this has been the trend all year. Commodity groups were strong almost from January 1 forward, as last year’s winners were taken out to the woodshed. The CNBC FastMoney crowd is hammering the growth stock rotation, but for a lot of these companies, the underlying fundamentals haven’t changed. We are seeing an old-fashioned rotation.
We are long all of the above names for clients, although I’m sure other names and sectors did well today too.
The SPDR Energy Select Sector Fund (ARCA:XLE), the integrated oil ETF was up just 0.70%. (no exposure).
Coal looks to be the sleeper sector for 2014. The stocks and sector were completely out-of-favor at the end of 2013, given the political sentiment. It may be attracting money simply from a contrarian sentiment perspective.
My own opinion is that this lasts until late summer, 2014. We would likely be sellers and rotating into other sectors for a “traditional” 4th quarter rally, i.e. Financials, Tech, Retail, etc.