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After several weeks of share drops and a seven-day losing streak, miners started moving to the upside today with a decent 1.1% spring. The jump came just as electric car-maker Tesla sees future shortages in metals and battery minerals.
The move is a breath of fresh air, given that most miners have seen their share prices fall since mid-April. For the past two weeks, the likes of KAZ Minerals, Antofagasta, Glencore and Anglo American have seen a drop of 8-14%. One of the larger events that impacted miners this past month was last Tuesday’s (30 April) China PMI manufacturing.
The weaker than predicted Chinese manufacturing output data weighed on the industry as a whole. The larger blue-chip miners suffered losses of 1.6- 2.6%. Moreover, Copper prices falling to $2.76 in May, the lowest level since the February lows, has really kept the industry under pressure.
The recent bounce can also have a very simple and very technical explanation: What goes down should come up…at some point. And the Mining Sector bounced with quite some courage after an almost month-long slump.
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Amrit Panesar, Senior Trader, 3 May 2019
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