|Bid||27.90 x 1000|
|Ask||0.00 x 1100|
|Day's Range||28.84 - 29.16|
|52 Week Range||26.00 - 36.56|
|PE Ratio (TTM)||N/A|
|Beta (3Y Monthly)||1.04|
|Expense Ratio (net)||0.39%|
If you aren't already betting on metals and mining stocks, you ought to consider doing so now. The sector faces "a 'Goldilocks' backdrop," states a recent report from British bank Barclays, which cites dovish interest rate policy from the Federal Reserve, improving economic conditions in China, and positive U.S.-China progress on trade. were recently up 24% and 38%, respectively, so far this year according to Morningstar. Both produce iron ore as well as other industrial metals.
Is the Party Just Getting Started for Iron Ore Miners?(Continued from Prior Part)Citibank recommends participating in the current iron ore price rallyCitibank (C) is advising investors to participate in the current iron ore price (PICK) rally. The
Could China’s Slowdown Weigh on Iron Ore Prices This Year?(Continued from Prior Part)Daily average output slides Previously, we looked at how Chinese iron ore imports stayed weak last year due to lower steel production. As reported by Reuters,
Mining stocks and sector-related exchange traded funds strengthened Monday as a trade war cease fire between the U.S. and China fueled hopes that the second biggest economy in the world could recover and pick up on demand for raw materials. Both COPX and REMX also broke above their short-term trend line at the 50-day simple moving average as well. Industrial metals and related mining companies rebounded on hopes that the U.S. and China would put aside their trade spat.
Has Trade War Affected China’s Steel and Iron Ore Demand? Stronger steel demand is the key driving factor behind the rising output. While steel margins are still strong due to robust demand, concerns over the Chinese growth outlook were weighing on steel prices.
Has Trade War Affected China’s Steel and Iron Ore Demand? In the previous article, we discussed that Chinese iron ore imports remained stronger despite the trade war fears in July. The stronger imports are primarily due to the robust steel production in the country.
Cleveland-Cliffs’s (CLF) cash cost of goods sold for its US Iron Ore (or USIO) division was $62.30 per ton for Q2 2018, an increase of 4.8% YoY (year-over-year) and 9.2% sequentially. The increase in cash cost was mainly due to the favorable shift in product mix. Due to increased customer demand, the company is producing a higher percentage of the higher-cost, higher-margin Mustang pellet, which it originally expected. It believes that will be a net positive for the company. Higher energy, labor, and royalty rates also impacted the company’s cash costs during the current quarter.
Can Iron Ore Catch a Bid amid China’s Wobbly Growth Outlook? As we learned in the previous article, bumper margins have prompted Chinese steel mills to continue increasing their output. In 2017, Chinese steel prices rose ~30%, and they’ve remained buoyant this year.
In the previous article, we learned that Chinese iron ore imports remained weaker in June on higher inventories and environmental inspections.
While strong margins have been prompting Chinese steel mills to continue increasing output for the last several months, economic jitters have started to weigh on margins. The steel prices in China remained more or less range bound in June despite lower inventories. The ongoing tit-for-tat trade tariffs and the impact of China’s new monetary measures could have a far-reaching impact on the activity in a number of sectors in the country, impacting steel demand. Thus, market participants are currently on the sidelines waiting for more clarity.
As we saw in the previous part of this series, wider margins have prompted Chinese steel mills to continue increasing their output. In 2017, Chinese steel prices rose ~30%, and they’ve remained buoyant this year. In this part of the series, we’ll discuss steel prices’ performance in recent months and their outlook.
Can Iron Ore Prices Break Their Trading Range and Rise in H2 2018? As we’ve discussed in the previous part of this series, Chinese iron ore imports rebounded in May, and the reason is quite obvious: the rebound in steel production growth. China’s steel production in May 2018 came in at 81.13 million tons, which is growth of ~9% year-over-year (or YoY) and 5.8% sequentially.
The Federal Reserve publishes capacity utilization data along with industrial production data every month. Capacity utilization in industries is a precise indicator of economic progress, as industries make changes to production planning depending on anticipated demand for their products. Capacity utilization, as the name suggests, is the percentage of capacity utilized of the total potential output.
The Federal Reserve released the May US industrial production report on June 15. The report indicated that industrial production fell 0.1% in May as compared to growth of 0.9% in April. Trends in industrial production can offer insight into upcoming changes in the business cycle.
After hitting a multi-year high earlier this year, Chinese steel inventories are now depleting quickly. Strong domestic demand is helping the drawdown of inventories, which is supporting domestic steel prices. According to an analysis by the Australia and New Zealand Banking Group, steel inventories touched a four-year high of 19 million tons in March but have been off 30% since then.
Mark Zandi, the chief economist of Moody’s Analytics, said that US job growth remains strong but is slowing, as businesses are unable to fill the record number of job openings. The low unemployment rate is making it harder for businesses to find suitable employees, which is forcing them to offer higher wages, leading to an overheating economy. As per the May ADP employment report, job growth in the professional and business services sector continued to be the key driver for jobs additions.