By Investment U
A recent Barron’s article was very positive about banks in 2013.
They expect healthy growth from capital markets, corporate lending and deposits. And the existing catalysts of housing and the labor market to continue to push earnings higher.
The article listed the EU and the US regulatory environment as the reasons for a recent slump in consumer confidence and the slowdown in bank stocks. But they are confident earnings growth will continue through the fourth quarter, supported by improving credit quality, loan growth, and better expense control.
The keys going forward, and where your focus should be to track this segment of the market, are the housing recovery and the improving jobs numbers. Both will run through to the banks and will drive their bottom lines.
The basket of stocks Barron’s listed are included below. The one that jumps out at me is PNC. It has shown up on at least five other recommended lists for the banking sector, and that deserves a little attention.
– Bank of America (NYSE: BAC)
– JP Morgan (NYSE: JPM)
– Key Corp (NYSE: KEY)
– Pac West Bancorp (NASDAQ: PACW)
– PNC Financial (NYSE: PNC)
Natural Gas Prices are Surging… And Nobody Has Noticed
Next up, natural gas is quietly creeping up in price.
Gas prices are running up on much tighter than expected numbers for stored gas. The US Energy Administration reports that the stockpile was 2.1% below the five-year average.
Greg Troccoli, technician and co-founder of Chart LabPro.com stated in a recent The Wall Street Journal article that gas is up 15% and no one is paying any attention.
The United States Natural Gas Fund (NYSE: UNG) was up 4.1% in one day of trading last week and other gas indexes are up 2% to 4%, as well.
A Goldman Sachs report stated that it sees prices going to $4.50 levels but are looking for about $4.25 this year. Gas prices broke through $4.15 early last week.
Goldman says the Street does not appreciate the significance of the fact that the gas storage surplus is gone and production is declining. Storage is actually showing a deficit through April 4 and there has been a two-month decline in production. And, Goldman expects a greater shift back to coal than previously estimated.
Natural gas is the fuel for the next 100 years. In fact, industry insiders are predicting gas will dominate transportation, electrical generation and manufacturing much sooner than anyone thinks possible.
The companies Goldman likes: Southwestern (NYSE: SWN), Cabot (NYSE: COG), Halliburton (NYSE: HAL), Basic Energy Services (NYSE: BAS), Nabors (NYSE: NBR) and NRG Energy (NYSE: NRG).
The ones I have seen on multiple gas lists are Halliburton, Nabors and Cabot.
Owning natural gas now is like buying into the oil boom of the early 20th century. It is a must for every portfolio.
[Note: Our friends at The Oxford Club have tipped us off to a natural gas stock they believe could triple by the end of the year. According to their sources, this company is about to make a major announcement that “will launch one of the most explosive stock run-ups in recent history.”
To see the full report, click here.]
Slap-In-The-Face Award: Beer Cheaper Than Water
This week the Award goes to the health minister in the Czech Republic who wants to make water cheaper than beer.
You heard me right; a glass of water in a pub in the Czech Republic is twice as expensive as beer.
The Czech Republic is the largest consumer of beer in the world and their beer-drinking heritage goes back to the 13th century.
They drink so much beer it is delivered to the pubs, not in kegs or cases, but delivered by tanker truck. The kind we use to deliver gasoline.
And they take this stuff really seriously.
There was actually a war fought over the right to brew beer and the patron saint of the country is also the patron saint of beer making, St Wenceslas.
I grew up in a coal mining town where there was a bar on every corner, and I thought we drank a lot of beer, but these folks are the real champs.
The health minister said he gives his efforts very little chance of success, but he will try again.
One pub owner was quoted as saying, “It really ticks me off. Beer is like mothers milk to us. The government should work on important things.”
Beer, half the price of water! Maybe it’s time for another trip to Prague.
Good Investing,
Steve
Article By Investment U
Original Article: Time to Play Rising Natural Gas Prices
