Sector Snap: Chemicals

Analyst Says Export Market and Pricing to Emerge As Themes for Chemical Companies in 1st Qtr

NEW YORK (AP) -- The U.S. manufacturing sector is holding up relatively well, according to one analyst, which he said may bode well for chemical companies in the first quarter.

Goldman Sachs analyst Robert Koort said weakness in consumer spending and the housing market may test many chemical companies, but said some may benefit from relative strength in the manufacturing sector.

"Given continued strong global growth fueled by emerging economies and further deterioration in the trade weighted dollar, exports are likely to keep the U.S. industrial economy from a deep slump," Koort wrote in a client note.

Koort was bullish on agricultural and fertilizer companies because of strong demand abroad, high prices and continued demand.

"The agriculture and fertilizer sector, with its terrific fundamentals, will prove unique in an otherwise challenging and eroding macroeconomic environment," Koort wrote in a client note.

In afternoon trading, DuPont Co. declined 34 cents to $48.98, and Dow Chemical Co. declined 41 cents to $38.10.

Monsanto Co. rose $2.80, or 2.4 percent, to $123.98.

Rohm & Hass Co. gained 11 cents to $56.28, and Air Products gained $1.14 to $95.73.

Among fertilizer companies, Potash Corp. of Saskatchewan Inc. rose $4.81, or 2.7 percent, to $183.30, and set an all-time high of $184.42. Mosaic Co. rose $4.14, or 3.4 percent, to $125.79, and set an all-time high of $126.

Both companies rose following comments from UBS analyst Joe Drewhurst, who forecast strong global demand and limited supply for fertilizers potash and urea.