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Quarter-End Insights

Our Outlook for Basic Materials Stocks

Many factors are pointing in the right direction for 2010.

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In general, 2010 should award basic materials companies with stronger demand for their products, and cost-cutting measures should continue to drive profitability. Producer discipline will be critical to maintaining pricing and profitability in certain industries, however, given relatively low capacity utilization. Weather will also have important implications for how 2010 shapes up for coal and agriculture companies.

Elizabeth Collins has a position in the following securities mentioned above: VALE. Find out about Morningstar’s editorial policies.