Industrials Get a Bump, for Now

 | Oct 20, 2011 | 10:40 AM EDT  | Comments
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Stock quotes in this article:

unp

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cat

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utx

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ph

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mmm

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cmi

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f

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aapl

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intc

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dell

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brcm

You put together Union Pacific's (UNP) incredible car-loading numbers and you throw in the Philly Fed, and the next thing you know, all of the big industrials that we threw out yesterday on Europe come roaring back today. Look at that: Caterpillar (CAT), United Technologies (UTX), 3M (MMM), Cummins (CMI) and Parker Hannifin (PH).

It's pretty ridiculous.

It is ridiculous because this move, with the exception of Union Pacific, will wither as we focus again on Europe.

Union Pacific was truly terrific. We've got fantastic auto numbers, which will not get whacked off of a Ford (F) strike, because that's now a done deal. We have terrific oil and chemical numbers, and why not? We have oil gushers all over the country, and the oil has to be transported by rail, barge and truck, because there aren't enough pipelines. This is all such good news.

But I come back to the pattern of this market. Everything you see on the screen is nothing you get at the end of the day. Whether it be Europe, whether it be a worry about locking in profits through levered ETFs, which I now believe are here to stay, or whether it be the grudging recognition that tech post-Apple (AAPL) and post-Thai flood and banks post-anything have not been able to keep gains.

Maybe today is different. That's been a sucker bet, though.

Random musings: I think that people should be buying the Thai plays -- the ones being hit, including Intel (INTC), Dell (DELL) and Broadcom (BRCM). They will come back. It is an opportunity. Intel in particular is attractive. It will raise the dividend and buy back millions of shares here. I would not buy Western Digital (WDC), as I don't like drive stocks. Too much commodity. And they will all ramp up production quickly to make up for the Thai flood shortfall.

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