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CATERPILLAR STOCKS FALL ON RATING DOWNGRADES - Capital Street FX

03-Apr
23:43 IST

Caterpillar’s stock is currently trading at 139.28-lower by 0.69% as compared to the previous closing price. In the pre-market trading session, the stock was trading lower by 0.88%. The stock has pared some of its losses after the opening bell.

The heavy equipment maker’s stock fell on Wednesday after Deutsche Bank downgraded it to hold from buy. The bank also slashes its 12-month price target on Caterpillar to $128 from $152.

Deutsche bank analysts noted that Synchronized global growth has collapsed, the China Land Cycle is rolling over, Europe is slowing more than expected and the US is oversaturated with construction equipment. Each of these factors alone is powerful drivers of Caterpillar’s earnings, but together this synchronized slowdown will not only guide to a negative earnings revision cycle, but also make 2019 the cyclical peak.

Caterpillar shares are currently down 13% from their 52-week high of $161. The heavy equipment maker’s stocks had rallied by 10% in 2019 through Tuesday’s close.

On the technical front, the RSI is currently at 61.71% and suggests that the market can move in the downward direction. The current price is above the MA5. The current price is above the middle line of the Bollinger bands but is heading downwards.

 

TRADE SUGGESTION- LIMIT SELL AT 139.40 TAKE PROFIT AT 138.60 STOP LOSS AT 139.80

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