THE TIPSTER
US LISTED Compass Minerals is the owner of Salt Union, Britain’s largest supplier of rock salt – used for gritting the country’s roads. With the news that Britain may be in for another cold and snowy winter, demand should be strong. After last year’s fiasco, even austerity won’t stop councils from stocking up. IG Index offers a spread on Compass Minerals International Inc of $82.01-$82.09.
Following the low of 466p earlier in the year, Rolls-Royce had been recovering well before the grounding of Quantas’s A380 fleet. Now the planes are back in the air and the order book is looking healthy, with two new contracts announced this week. Rolls-Royce could be a bargain at a price below 605p. Cantor Index offers a spread of 602.46p–605.04p on Rolls-Royce.
The FTSE 100 has come under pressure in the last two weeks as problems within Europe began to affect investor sentiment in Britain. Since July, the FTSE has been steadily trading higher within a channel, and having hit the top in early November is now languishing at the bottom end. The news hasn’t got much better, but traders of sterner constitutions may look to buy around here in anticipation of a run higher. ETX Capital is quoting 5,610-5,611 for the daily rolling contract on the FTSE.
Gold has been grinding a little higher from the $1,330 area to sit at the higher end of this upward channel. Given its resistance levels at the moment this could present a selling opportunity for a possible move down towards $1,360. The risk of taking a short position is that any escalation of tensions in the Korean peninsular would probably push the price up further. Any short position should have a tight stop loss. Capital Spreads quotes a price of $1,375.8-$1,376.3 for the spot price of gold.
The Spanish information technology company Indra Sistemas is looking like a reasonable buy. Despite the disastrous state of the Spanish home market, which accounts for 63 per cent of revenues, cash flow has held up well. Indra suffers from a huge Spanish discount relative to its peers, but it is not justified by the fundamentals. IG Markets offers a spread on Indra Sistemas of €12.76-€12.77.
Rio Tinto, one of the world’s largest copper miners, is set to benefit from rising copper prices as a result of a global shortage in copper supply. However, with its high exposure to the red metal, Rio is likely to be more vulnerable than others over growing speculation regarding fiscal tightening in China and consequential metal price volatility. Capital Spreads offers a spread of 4,173.4p-4,181.1p on Rio Tinto rolling daily.