CNBC Sector Snap: Strong outlook for coal forecast

DENVER - Improving economic indicators indicate a positive outlook for coal despite a near-term slowdown in China's imports, an analyst said Wednesday.

Citi Investment Research analyst Alan Heap told clients in a research note he believes demand is recovering for both thermal, used in heating, and coking coal, used in manufacturing.

"Our preferred commodity exposures to the economic recovery are copper and coal," he said. "China's import growth will slow...but investment flows will limit the retreat."