Stocks retreat after gains. Cast iron shines anew

Stocks retreat after gains. Cast iron shines anew

by John Natale, Wells Fargo Asset Management

Today’s Daily Advantage comes from guest writer Jim Durning.

Major stock indexes in the U.S. were flat to lower as corporate earnings reports were mixed. The Dow gained 25 points, with 15 of its 30 components advancing; the S&P 500 Index lost 3 points; and the Nasdaq fell 19. Decliners led advancers by four to three on the NYSE and nine to five on the Nasdaq. The prices of Treasuries moved modestly higher. Gold futures added $3.00 to close at $1,332.30 an ounce. The price of crude oil fell $0.49, settling at $45.45 a barrel.

In earnings news:

• Johnson & Johnson announced second-quarter profit fell 11%, mainly due to a sizable gain a year ago, but it beat analysts’ expectations. The company also raised its full-year financial forecasts. The company’s shares (JNJ) traded 1.71% higher for the day.
• Yahoo! Inc. said that revenue fell 15% in the second quarter in what could be its last earnings report as an independent company. The company’s stock (YHOO) gained 0.58% in trading as the company said final bids on its web, email, news, and other businesses were due on Monday.
• EMC Corp. reported positive second-quarter results ahead of a shareholder vote on its acquisition by privately held Dell Inc. Profit rose 19%, and both net earnings and revenue beat expectations. EMC’s shares (EMC) were up 2.07% for the day.
• IBM Corp. reported that sales declined in its most recent quarter, even as it made gains in areas such as cloud computing and data analytics. The company’s shares (IBM) declined 0.18% on the day.
• Netflix Inc. reported a slowdown in net customer additions in the U.S. and abroad. Shares of Netflix (NFLX) fell 13.13% in trading.
• Swiss pharmaceuticals company Novartis AG reported lower second-quarter sales and net profit. Novartis’ shares (NOVN) lost 0.25% in trading.

In other business news:

• U.S. Federal Reserve (Fed) officials are looking more confidently toward an interest-rate increase before year-end, possibly as early as September, now that financial markets have stabilized after Britain’s vote to leave the European Union and the economy shows signs of picking up, according to a Wall Street Journal analysis of recent interviews with and public comments made by Fed officials.
• Samsung Electronics Co., Ltd., said it is in talks to acquire a stake in Chinese automaker BYD Co. Ltd. to boost its chip business for electric cars. Samsung, the world’s top maker of smartphones and memory chips, created a team to develop automotive-related businesses in December, seeking a new growth engine amid a slowing global smartphone industry.

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Cast-iron futures

There appears to be no end to the development of new and useful (and a few not-so-useful) kitchen gadgets. They arrive so frequently they can threaten the execution of many recipes because, through some bending of the laws of physics, the not-so-useful gadgets tend to float to the top of the cooking and baking utensils in kitchen drawers and to the front of cabinets filled with pots and pans.

The simple, one-step chili pepper corer/cleaner? Yep, right on top, prompting a desperate dig for needed spatulas and wooden spoons. The two-part meatloaf pan that separates drippings as meat cooks? You bet, front and center in the cabinet. Well, not both parts, just the perforated half that, by itself, is not so useful except to clatter to the floor when trying to grab the stock pot.

With this in mind and hands in the sink washing the new avocado scoop, it may be reassuring to know that a revival in America’s interest in and appreciation for cast-iron cookware is underway.

While grandmother’s heirloom china remains on display in the dining room cabinet, great-grandma’s cast-iron skillets and Dutch oven are vital members of the most active room in many families’ homes, the kitchen.

As The New York Times reported, “A well-used, well-seasoned cast-iron skillet is truly an all-purpose pan: nonstick enough to cook eggs, hot enough to sear anything, and completely functional for roasting, stewing, simmering, and baking.” Gourmands rave about the sear a cast-iron skillet puts on a steak. Others wax poetic about the skillet’s ability to coax a cornbread or Irish soda bread to heretofore unattainable fluffiness throughout.

While cast iron is in higher demand for everyday cooking, cast-iron collecting is growing quickly also. Buyers seek rare skillets like the Erie Spider—a spider skillet’s feet rest in the embers of a fire—making them pricey prey for eBay bargain hunters. Meanwhile, traditional cast-iron manufacturers such as Lodge, Griswold, Wagner, and others are still feeding America’s appetite for new cast-iron cookware as well.

Want even better news? Manufacturers new to the scene are mixing age-old processes with new technology and approaches to deliver quality cast-iron cookware for this and future generations. Finex in Portland, Oregon; Borough Furnace in Syracuse, New York; and the Field Company, which hasn’t selected a headquarters yet, are three that have initiated operations in recent years.

In a hallmark of the internet economy, each of these new entrants in the cast-iron cast of manufacturers got its start with initial funding raised through Kickstarter from hundreds of small backers, who eventually receive pans in return for their sponsorship, The Times reported.

Producing cast-iron cookware presents challenges for today’s manufacturers. Old-school cast-iron skillets were individually poured into a mold and polished by hand to produce remarkably smooth finishes. This labor-intensive process, however, can drive prices to uncompetitive heights. As a newer manufacturer explained, “I fell in love with that smoothness, but now that I make them, I realize why it went away.”

So, if you have old cast-iron cookware, treasure it—but rest assured that new approaches are producing cast-iron cooking products that are highly valued as well for all of the traditional benefits cast iron brings to your cooking exploits.