a) Emerson (think electrical products, motors, power systems and management) missed, saying "improvement is occurring at a slower pace than previously expected. Additionally, Europe weakness has persisted, and while orders and sales have improved in China, its economy has been and will remain softer than anticipated."
b) A little bit of good news from building materials company Martin Marietta (think sand, gravel): Prices were a bit higher (up 2.8 percent), volumes were notably higher (up 9.6 percent), so gross margin improved. The company said it was "increasingly optimistic about our outlook for the remainder of 2012."
Why did it miss? Apparently there were additional expenses, because the company is trying to buying rival Vulcan Materials.
c) Coal is still a mess: Arch Coal is illustrative of the problems the coal industry is having: Posting a loss of $0.04 (estimate was for a gain of $0.16) and cuts the quarterly dividend to $0.03 from $0.11. They are expecting lower coal volumes in 2012: "We are resetting our 2012 expectations," said John W. Eaves, Arch's president and chief executive.
The big issue: power generators are switching to natural gas, resulting in an "unprecedented build in power generator coal stockpiles," Eaves said.
But wait a minute: What's up with nat gas? After dropping to $1.982 on April 20, nat gas is back to $2.34, up 15 percent in less than two weeks? Is this the long-awaited bottom in nat gas? Morgan Stanley, in a note this morning, said: "Recovery in nat gas prices could provide limited relief in the U.S. domestic thermal coal market."
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