2 Stocks Poised to Benefit From Infrastructure Spending

During the 2020 election campaign, President-elect Joe Biden pledged to invest $2 trillion in roads, bridges, clean energyand other initiatives to advance American competitiveness, create jobs and curb climate change.

This figure could even increase after the Democrats take control of both chambers of Congress after winning the Georgia Senate runoff earlier this month, paving the way for even greater infrastructure spending. “Cyclical value stocks will likely benefit from larger stimulus packages and infrastructure spending that will be more likely with the Democrats’ full control of Washington,” said Hodges Capital portfolio manager Eric Marshall. told Reuters.

Below, we take a closer look at two stocks that stand to benefit from the coming infrastructure spending spree. We will also analyze their charts to identify technical levels to monitor.

Fluor Corporation (FLR)

Fluor provides engineering, procurement, construction and fabrication services to end market customers in energy, chemicals, mining, metals and transportation. Last year, the $2.84 billion company landed a government contract to decommission, decommission and remove select nuclear facilities nationwide, a trend that is expected to continue under the new administration as she is turning to clean energy solutions. As of January 18, 2021, Fluorine stock has traded relatively flat over the past year, but has jumped almost 30% since the start of the year.

The company’s stock price has remained in a consistent uptrend since late September, with the 50-day SMA crossing above the 200-day SMA in mid-November to generate a golden crossover buy signal. Active traders should look for retracement entries at the $17.15 level, where price finds confluence of support from a four-month trendline and the 50-day SMA. In terms of business management, seek to recognize profits close to significant overhead resistance at $29.75 while mitigating risk with a stop loss order placed under the December swing low at $15.52.

Nucor Corporation (NUE)

With a market value of $16.75 billion, Nucor produces and sells steel products through three segments: steel mills, steel products and raw materials. The 63-year-old company could become the Biden administration’s steelmaker of choice, given that it recently signed a 15-year deal with EDF Renewables North America that will see it reduce its carbon footprint by using solar energy from 2023.

Additionally, Nucor is well positioned to meet increased demand for government infrastructure spending with the construction of a new sheet steel plant in Kentucky. Through Friday’s close, Nucor stock is issuing a handy 2.92% dividend yield and trades up 4.29% on the year. Over the past 12 months, stocks have gained about 4%.

The steelmaker’s share price has trended steadily higher since its March 2020 pandemic plunge liquidation down. Those looking for “buy the dip“Opportunity should seek entries near $53.30, where price finds support from a well-respected nine-month uptrend line and 50-day SMA. Consider Bank Profits at $61.50 or $68.80, two important resistance levels. cutting losses if the stock closes below last month’s low at $51.78.

Disclosure: The author held no position in the aforementioned titles at the time of publication.