Newspaper article The Evening Standard (London, England)

Miners Clobbered but More Mileage Is Seen

Newspaper article The Evening Standard (London, England)

Miners Clobbered but More Mileage Is Seen

Article excerpt


MINING shares were on the receiving end of another clobbering today, but anyone thinking their bull run may be over can think again.

US broker Citigroup is one of those in the Square Mile that reckon the miners still have plenty of life left in them and will continue to be driven higher by soaring commodity prices.

It says the clamour for copper, zinc, gold and silver has forced its hand to raise its prices forecast again.

The revision makes breathtaking reading. Take Rio Tinto, for instance, where Citigroup has raised its sights from 3400p to 4200p. But the share price did not appear to be listening and, along with the other major players, posted a fourth consecutive day of losses, falling 80p to 2948p.

Citigroup has raised its target for Anglo American, 62p lower at 2220p, from 2500p to 3000p, Antofagasta, off 73p at 2200p, from 2600p to 3000p, Vedanta Resources, 93p cheaper at 1402p, from 1500p to 2200p and Xstrata, down 88p at 2120p, from 1500p to 2200p.

But not everyone is happy to continually re-rate the miners to reflect the latest surge in metal prices. Some traders say the quality of management can vary wildly from one company to another, and miners are vulnerable to currency fluctuations and interruptions to production.

Investors generally were happy to see to the market steady itself following the losses of the past couple of days. Share prices traded within a narrow range but were still nursing

small losses overall. The FTSE 100 index fell 2.4 to 5838.9 with investors braced for opening losses on Wall Street this afternoon.

There were a few bright spots around, however, in the wake of yesterday's sell-off. Merger partners Boots, up 171/2p at 740p, and Alliance UniChem, 271/2p better at 936p, attracted support. …

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