Goldman Worries Over London Metal Exchange Proposals and 2 Other Dow Movers to Watch
The Goldman Sachs Group Inc. (NYSE:GS): Current price $162.71
In a research note, Goldman Sachs said that the London Metal Exchange proposals to reduce queues to move metal out of the warehouses could raise price volatility and lower transparency, while more metal comes off the exchange. The Exchange is now under regulatory and legal scrutiny regarding its metal storage practices, hearing complaints concerning months long queues waiting to withdraw physical metal from its warehouses. The current system is being blamed by clients of the warehouses who say it inflates the cost, or premium, to secure metal. The situation is especially problematic for aluminum, which is employed in packaging and transport, despite the market being in excess supply worldwide.
Chevron Corp. (NYSE:CVX): Current price $117.62
Chevron, operator of the $49 billion Gorgon natural gas venture in Australia, reports that some “uncertainties” remain in the construction of the project, subsequent to its budget last year jumping by 21 percent. Chief Financial Officer Pat Yarrington observed that some areas of construction “still need to improve” after Gorgon costs skyrocketed on the appreciation of the Australian dollar, higher labor expenses, and weather delays. However, Yarrington said that labor productivity at Gorgon has increased.
The Boeing Co. (NYSE:BA): Current price $132.88
Boeing says that it expects to finalize production of the C-17 airlifter at Long Beach in 2015, and the firm also foresees a new role for the 5,000 workers at the site: the assembly of its planned 777X widebody airliner. The company predicts that the 777X will be “the largest and most-efficient twin engine jet in the world,” offering 20-percent better fuel efficiency than the current 777, as it carries between 350 and 400 passengers to ranges of more than 9,000 nautical miles. When combined with the new 787 Dreamliner, it is anticipated that the 777X will dominate the high end of the commercial transport market after it launches around 2020.