Shares of the aluminum producer rose by 1.82% percent on Monday after the company reported its earnings for the first quarter of the year. Alcoa announced yesterday an increase in quarterly profits as performance in its alumina and primary metals segments improved. The revenue of the company fell a little bit. Forex on Alcoa climbed 0.15 points and closed the day at 8.39 after the announcement of the report.
In the first quarter of 2013 net profit of Alcoa rose to $149 million while the profit year earlier was $94 million. Revenue slipped 3 percent to $5.83 billion from $6.01 billion in 2012. Market analysts had expected the company to report earnings excluding items of 8 cents a share on $5.88 billion in revenue. The Alcoa’s CEO Klaus Kleinfeld said that he is optimistic that current year is going to be better than 2012 and he still project 7 percent demand growth in aluminum.
Economists expect earnings for Broad American S&P 500 companies to climb by 1.6 percent, which is down from 6.2 percent last quarter and lower than forecast of 4.3 percent in January. The quarter is expected to provide unusually high number of negative warnings. The revisions of 107 companies seems negative and compared with the positive revisions, it will be the worst pace in 12 years.
Technically speaking, Forex on Alcoa are in a medium term negative trend from the beginning of the current year. The last wave from yesterday seems as a correction of the actual trend and new decline of shares could be expected. A clear break below the lowest level of the year could extend the medium term bearish trend to the low of 2012 at 7.96. On upside the first resistance could be projected at 8.54 and break above it would lead the price of Forex on Alcoa to next resistance at 8.69. The last is crucial for the negative momentum and weekly close above it would return shares on upside.
The information in this analysis is collected from different sources and should serve for informative purposes only. The author shall not be held responsible for the validity of the presented information. No part of this analysis recommends the purchase or sale of a currency pair or any other financial instrument.