This morning, Nokia (NOK) -- primarily known for its presence in the mobile phone arena -- announced that it is filing suits against some liquid crystal display (LCD) makers. NOK believes that these LCD producers are engaging in a bit of price fixing. It filed suits in the U.S. and Britain last month. NOK believes that a group of manufacturers was fixing the prices of LCDs that the company uses in its handsets and of cathode ray tubes. The company said that it "has filed suits to recover overcharges it paid as a result of cartel activities which are currently under governmental investigation."
Really? Cartel activities? I understand that the company is upset about having to pay what it feels are fixed prices for mobile phone components, but cartel activities?
Cartel activities or not, the stock is in the midst of a downtrend that started after it met with resistance from its 50-week moving average. The stock was actually in the process of recovering from its 2009 lows, but this trendline brought any ideas of a rally to a quick end. In addition to the resistance from the weekly trendlines, the equity faces resistance in the form of its 10-month moving average. The shares have not closed a month atop this trendline since April 2008.
Is there good news for the equity? Perhaps. It seems that a rather solid floor is in place in the $10 region, so we could see the stock rebound from there and enjoy a bit of a run.
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