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Could miners dig themselves out of the dirt?

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.

Whether you are bullish or bearish on the Mining Industry as a whole or on the specific miners themselves, get access to our research and trade opportunities via our Research Gold Pass.

We send out hand-picked trading opportunities daily, helping clients identify winners, be they stocks in the throes of a rebound, trading in a range, benefiting from momentum or in the midst of a breakout.

Let us do the hard work searching so you can take it easy and descend straight into the investing/trading part the way you want to.

Amrit Panesar, Senior Trader, 3 May 2019

 

 

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This research is produced by Accendo Markets Limited. Research produced and disseminated by Accendo Markets is classified as non-independent research, and is therefore a marketing communication. This investment research has not been prepared in accordance with legal requirements designed to promote its independence and it is not subject to the prohibition on dealing ahead of the dissemination of investment research. This research does not constitute a personal recommendation or offer to enter into a transaction or an investment, and is produced and distributed for information purposes only.


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Prepared by Michael van Dulken, Head of Research

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