Coal stocks ride China's stimulus waveSeptember 10, 2012: 1:38 PM ET
Investors who have been burned by holding onto coal stocks this year may finally be feeling the right type of heat.
Coal stocks started heating up Friday, after China announced a $156 billion commitment for improving the country's roads, rails and other infrastructure.
With China planning 55 new major infrastructure projects, investors are betting that those projects will rev up demand for coal, which China uses to make steel for its bridges. Coal
China's news gave at least one StockTwits trader a reason to pat himself on the back.
That's a good point. Fundamentally, nothing has really changed.
China has pledged to spend billions on infrastructure, but there are still some pretty big inventories out there. And China's growth forecasts have been shrinking. So this little rally could prove to be just that...a little rally.
Price can be wrong but for now at least, things are getting dicey for investors betting on a fall in prices by taking short positions.