Chinese steelmakers eye iron ore
June 11th, 2009 by Bryden Elssmann
Closing Data
| current | change | % | |
|---|---|---|---|
| Dow Jones | 8739.02 | -24.04 | -0.3% |
| NASDAQ | 1853.08 | -7.05 | -0.4% |
| S P 500 | 939.15 | -3.28 | -0.3% |
| FTSE 100 | 4436.75 | 31.96 | 0.7% |
| Nikkei 225 | 9991.49 | 204.67 | 2.1% |
| SPI Futures | 4037 | 17 | 0.4% |
| All Ords | 4,016.00 | 82.7 | 2.1% |
| Oil | 49.67 | 1.18 | 2.4% |
| Gold | 954.7 | 0 | 0.0% |
| Silver | 15.225 | 0.085 | 0.6% |
| Aluminium | 1638 | 39 | 2.4% |
| Copper | 5180 | 133 | 2.6% |
| Lead | 1744.5 | 54.5 | 3.2% |
| Nickel | 15395 | 745 | 5.1% |
| Tin | 15850 | 700 | 4.6% |
| Zinc | 1607.5 | 43 | 2.7% |
Wall Street
U.S. stocks fell on worries that rising interest rates could put a dampener on consumer and business spending, but stocks pared losses late in the session to finish off the day's lows. The Dow Jones fell 24.04 points, or 0.27 percent, to 8739.02.
Commodity prices have been rallying lately, due to the weak USdollar and bets that the economic recovery will drive demand for so-called hard assets. But the rise in commodity prices also added to worries over inflation.
Exxon Mobil rose US72c, or 1 percent, to $US73.84, bringing the gains for the largest US company by market capitalisation to 6.5 per cent for June. Oil prices hit their highest level of the year, above $US71 a barrel, after an inventories report showed dwindling supply. A U.S. government report showed a slowdown in crude imports eating away at inventories in the world's top energy user. Oil has more than doubled from the low $30s level hit this winter as investors have started to price in expectations for an economic recovery which should boost consumption.
Australian Market
It was all about commodity stocks yesterday, especially the iron ore miners. The big miners in BHP Billiton, Rio Tinto and Fortescue Metals Group continue to be well supported. Especially Rio Tinto ahead of its rights issue.
A lot of money flowed into the junior iron ore miners following the collapse of the Rio Tinto Chinalco deal. The Chinese will be looking to secure long term iron ore assets either through the purchase of smaller miners or strategic stakes. Fortescue Metals Group (15.4%), Bluescope Steel (10%), Alumina (5.7%), BHP Billiton (3.3%) and Rio Tinto (3.4%) were the main advancers.
OZL Minerals could be the focus today as shareholders prepare to vote on a deal to sell most of it’s assets to China’s Minmetals. The Chinese firm raised its offer yesterday to $1.386 billion to fend off rival proposals.
This morning the Aussie market is set for a subdued open as concerns over the sustainability of an economic recovery in the USA pushed Wall Street lower, though resource firms could get a boost from firm base-metal and oil prices.
Investing is laying out money today to receive more money tomorrow.
Warren Buffett
Contact your Freeman Fox Stockbroker on 07 3031 9960 or 1800 003 369 Ext 7.
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