Ford stock, started indecisive despite UAW agreement, but closes higher
Evening Market Update: Ford stock started out slow but followed the general market higher late in the day. It was likely due more to the general market forces than the UAW news, as Ford closed at 10.09.
Ford Motor Company (NYSE: F) and the United Auto Workers (UAW) did not release details of the pact, but analysts expect it to be similar to an earlier deal with General Motors Company (NYSE: GM). Question is, how much did Ford sweeten the economic terms to win ratification from Ford workers?
According to reports from the Center for Automotive Research in Ann Arbor, Mich., Ford's hourly labor costs (wages and benefits) are estimated to have averaged $58 in 2010, compared with $56 at GM and $49 at Chrysler.
The union planned to focus on Ford last, but changed tactics when talks with Chrysler hit a roadblock following the GM settlement. The primary reason for focusing on Ford is that Ford swung to a profit of $2.7 billion in 2009 and $6.6 billion last year, after combined losses of $30 billion between 2006 to 2008.
Ford Stock Changes Very Little
Ford stock opened lower this morning relative to yesterday‘s close of 9.37, but had shown some resilience after the Ford media communication surrounding the agreement, only to fall back below the upper price gap during ht efirst hour. Then again, it’s early; so there is plenty of trading day left for the information to filter into traders’ minds.
Unfortunately, Ford stock already put in a new 52-week low of 9.05 at 9:55 a.m. which will become a significant level of price support on the daily and intra-day charts. After that time, though, the stock has been attempting to move up to fill the price gap left over from this morning’s open relative to yesterday’s close; and that finally occurred at 10.40 a.m.
For the record, the next technical price support level is 6.61 dating back to 9/28/2009.
In the meantime, stay tuned to Torque News for any change in Ford stock as we report on price dynamics using charts and technical analysis.
Just remember that Ford stock will have to close today above yesterday's close of 9.37 to have any positive effect on trading mentality. And by the intra-day chart shown of the first hour, it was having trouble deciding, despite that 10:40 upsurge. Fact is, traders are digesting the news; and that takes time as details come out slowly.
Full Disclosure: At time of publication, Sherosky, creator of the auto sector charts for TN, is neither long or short with the mentioned stocks or futures, though positions can change at any time. None of the information in this article constitutes a recommendation, but an assessment or opinion.
About the Reporter: After 39 years in the auto industry as a design engineer, Frank Sherosky now trades stocks, futures and writes articles, books and ebooks like, "Perfecting Corporate Character," "Awaken Your Speculator Mind", and "Millennial World Order" via authorfrank.com. He may be contacted here by email: [email protected] and followed in Twitter under @Authorfranks
S&P upgrades GM credit rating, places Ford on upgrade watch, and GM responds
Navistar reports Super Truck accomplishments at 2011 DEER Conference
Evening 10/03 Update: 2011 DEER Conference at Detroit
Tour Split-Cycle Engine technology display
Altair unveils world's first hydraulic-hybrid transit bus
Scuderi Split-Cycle Engine achieves 65 MPG under simulation study
Achates Power addresses commercial truck mileage and emission standards
Raytheon: Cyclone Power's combustion engine game changer
Buick LaCrosse with eAssist on par with highway fuel economy of compacts