Glencore (GLEN); Basic Materials / Mining
Price change since 14 April UK Index highs: -57%
This report is not a personal recommendation and does not take into account your personal circumstances or appetite for risk.
GLEN daily chart
(Click on image to enlarge)
Will the price bounce up towards 320p or will it fall beneath lows of 138p?
Observations: Glencore is perhaps the best placed of all the UK Index miners to a) bounce back quickly if and when commodities recover their poise or b) innovate its way out of the situation. The business includes not only mining itself, but commodities trading as well which means it can leverage currency fluctuations to make decent profits from buying commodities in one part of the world and selling them in another. The currency swings we’ve recently seen in Asia-Pacific are creating the ideal conditions for Glencore to outperform its sector at large amid continuing woes for commodities.
Bloomberg broker ratings: 40% Buy, 43% Hold, 17% Sell; Consensus Target: 244p, +75% (26 Aug ’15)
Most Bullish: Bernstein, outperform, TP 447p, +221% (25 Aug ’15)
Most Bearish: Investec, Sell, TP 132p, -5% (14 Aug ’15)
TSCO daily chart
(Click on image to enlarge
Will the price bounce up towards 310p or will it fall beneath support at 155p?
Observations: Tesco shares remain under pressure as we move towards the end of Q3 on worries about the pace of much needed asset sell-offs, but Investors will be reassured by news that its South Korean business, Home Plus, may finally be offloaded to private equity firm MBK Partners. Furthermore, ‘drastic’ Dave Lewis has done well on decisive cost–cutting measures. Store closures, scrapping of new developments, the closing of the company’s Cheshunt headquarters, the ending of the defined pension scheme and axing of dividend payments are all welcome signs of progress, and a new advertising campaign due to start in the autumn may be set to decisively kick start a recovery in the UK’s best known supermarket.
Bloomberg broker ratings: 37% Buy, 41% Hold, 22% Sell; Consensus Target: 228p, +21% (1 Sept ’15)
Most Bullish: HSBC, buy, TP 295p, +57% (23 June ’15)
Most Bearish: Day by Day, Sell, TP 163p, -13% (19 Aug ’15)
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