US markets in the dumps during Sept. 19-23 trading week

The Dow Jones Industrial Average fell an astonishing 1,232.01 points or 4% to 29,590.41 during the Sept. 19-23 trading week, while the S&P 500 fell 180.1 points or 4.7% to 3,693.23. 

Finding value gainers was challenging in a dark week for markets as heightened geopolitical uncertainty, stubbornly high inflation readings and briskly rising interest rates continued to rankle investors. Nexa Resources was among the few miners registering a gain this week, adding US20¢ per share to close at US$5.18 after ending the prior week on a 12-month low. On Sept. 14, Nexa announced the appointment of former Compañía Minera Antamina executive José Carlos del Valle as SVP for finance and as CFO starting Oct. 3. During his prior nine-year stint at Antamina, del Valle spearheaded an enterprise-wide transformation and secured a US$1 billion syndicated loan. Nexa, on Sept. 12, also reported that a road blockade of its Atacocha San Gerardo open pit zinc mine in Peru had been resolved, and the operation resumed production. The company expects the stoppage to cost 400 tonnes of zinc production, but it expects to make up the difference, and its production guidance remains unchanged at 118,000-127,000 tonnes this year. 

Brazil-based Vale also eked out a gain this week, adding US6¢ per share to close at US$13.04. Brazil-based base metals exposed companies have fared well amid the bloodbath that is North American markets, with investors favouring base metals in general. During its investor days early in Sept., the company took pains to explain how it addressed the initiatives aimed at resetting the business for better performance and future replacement and resource growth opportunities. Vale’s strategic plans point towards a base metals business with meaningful three-to-five-year growth potential (subject to execution and securing capex). Analysts also believe some form of separation of the base metals assets from the company’s iron ore business remains likely. 

Meanwhile, Kinross Gold also counted among the value gainers this week, adding US2¢ per share to close at US$3.31 apiece. On Sept. 19, Kinross announced it would aim to buy back US$300 million of its shares before the end of this year. It added that it will allocate 75% of excess cash to buybacks in 2023 and 2024. Kinross said the updated strategy stems from talks with Elliott Investment Management and an unspecified number of other investors. It also cautioned that buybacks in 2023 and 2024 are contingent on the company’s net leverage ratio remaining below the current level and stated the repurchases would be paused in the event of a rating downgrade, a significant drop in the price of gold, or major operational setbacks.