Time to Give Up on Caterpillar Inc. (CAT)’s Stock?

Yet, I still see hope in both the chart and the global economic trends. North America is coming back, even if it’s languishing at the moment. Latin America, while flagging, is still positive, and though most of the other regions are still down, they’re flattening out, signaling to me that this is more of a bottom than a new leg lower.

Iron prices are on the rise, nearing a three-month high, and copper — though down 11% so far this year — hit a five-week high on the strength of European manufacturing. If the continent is firming up as North America regains its footing, we have the makings of enough of a recovery to compensate for China’s stall.

Caterpillar Inc. (NYSE:CAT)’s stock dropped sharply after its earnings report, putting it on par where it was a year ago. While the monetary policies of central bankers has played a large role in propping up the world’s economies, much of the world is in a better position today than last year, and the gloomy outlook for Cat could just be the time when it emerges from the fog.

Fool contributor Rich Duprey has no position in any stocks mentioned. The Motley Fool owns shares of Companhia Vale Ads.

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