NEW YORK (AP) ¿ Shares of heavy equipment makers rose Monday after RBC Capital Markets initiated coverage on many companies in the sector with positive ratings due in part to the firm's outlook on the global commodities cycle. Analyst Seth Weber started the following companies at "Outperform," the highest rating: ¿ mining equipment manufacturers Bucyrus International Inc. and Joy Global Inc. ¿ mining and construction equipment giant Caterpillar Inc. ¿ Mueller Water Products Inc., which makes fire hydrants, valves and iron pipes ¿ construction-equipment rental company RSC Holdings Inc. and United Rentals Inc. ¿ heavy equipment maker Terex Corp. "We have a favorable view of the commodities cycle and mining machinery is our preferred way to participate," Weber wrote in a note to investors Monday. He also said the strong global presence of Bucyrus and Caterpillar, especially in emerging markets, should help sales soon.
Commodity prices have soared recently due to a declining dollar and expectations of future demand as factories, shipping and other industry gear up in a global recovery. For now, a weak buck makes commodities priced in dollars more attractive to foreign investors. For RSC and United Rentals, Weber said rentals often see increased demand early in a recovery. Shares of Bucyrus rose $1.89, or 4.8 percent, to $40.94; Joy Global climbed $2.79, or 5.4 percent, to $54.83; Caterpillar added $2.36, or 4.3 percent, to $56.93 and Terex traded up $1.08, or 4.7 percent, to $24.19 ¿ all four stocks hit 52-week highs Monday. Mueller Water gained 18 cents, or 3.3 percent, to $5.51; RSC edged up 10 cents to $12.30; United Rentals rose 12 cents, or 1.1 percent, to $10.94; Shares of other companies in the sector rose as well. Agricultural equipment maker AGCO Corp. was up $1.60, or 6 percent, to $28.27; Deere & Co. added $2.35, or 5.4 percent, to $46.40; Manitowoc Co. gained 92 cents, or 8.6 percent, to $11.58.