Base metals looking better

Stock markets south of the border moved sideways over the trading period Sept. 15-21, with a quarter-point interest rate increase by the Federal Reserve making little impact on share prices. The Dow Jones Industrial Average was off fractionally at 10,244.93, down 73.23 points from the previous Tuesday, while the broader-based S&P 500 rose a little less than a point, to 1,129.30, in the same period.

With both the Fed’s rate increase (anticipated by the market for most of the week) and higher prices for crude oil pointing to an economic slowdown, the industrial-metals equities might have been expected to roll over, but instead they were stronger across the board. The Big Three all posted gains: Anglo American popped up US$1.28 to US$23.94, BHP Billiton vaulted US$1.12 to US$19.82, and Rio Tinto rode US$4.92 higher to US$105.02. Homebrew Phelps Dodge, looking better with an increase in the copper price, added US$1.15 to close at US$85.89, while Southern Peru Copper rose US68 to US$46.20 and Freeport-McMoRan Copper & Gold was US94 better at US$38.80.

The gold stocks, in contrast, were all over the shop, even as bullion prices firmed slightly. Newmont Mining, which fell US$1.25 to US$42.89, possibly was hit by the rise in the Fed rate, which implied both a weaker gold price and higher U.S.-dollar costs for the gold producer; but that didn’t hold for other largely U.S.-based producers, such as Glamis and Meridian.

Shares in the large South African houses were better: AngloGold Ashanti was up US$1.08 at US$37.90; Gold Fields, up US70 at US$12.88; and Harmony Gold Mining, up US45 at US$13.33.