Is Copper About to Break Out To The Upside?

The price of Copper can be a leading indicator for global economic growth:

After hitting a high of $4.70 in February of 2011, it had been trending lower until it hit a low of $2.42 in January of this year, the lowest level since 2009.

Since January the trend has been to higher prices, closing at $2.92 on Friday.

There have been other consolidations during the 4 year down-trend, however it is important to keep an eye on the $3.00 level (which is close) and a move above this price would signal a break-out to the upside which may have implications for the global economy.

Q1 S&P 500 Earnings:

• 360 (72%) companies have reported.
• 71% have reported earnings above the mean estimate.
• The March 31 estimates were for a decline of 4.7%.
• To date, the blended earnings decline is .4%
• The Energy sector has out-performed expectations.

Forward  S&P 500 Earnings Expectations:

• Q2: year over year decline in earnings of 3.9%.
• Q3: year over year decline in earnings of .3%
• The current forward 12 month Price to Earnings (P/E) ratio is 16.8. The 10 year average is 14.1.