Best Research Ideas

Mining: China Policy Shift Is Bullish – Demand Risk Remains in U.S. and Europe

With a shift in policy needed to spark a gradual recovery in Chinese demand seemingly underway, Jefferies is cautiously optimistic that a slow recovery in China should offset weakness elsewhere. While macro risks are clearly elevated and mining shares should be volatile, the sector appears undervalued and poised to outperform as China recovers. Jefferies raises iron ore and coal price forecasts and upgrades Anglo, Rio, BHP, Vale, S32, Arch, BTU, HCC and METC from Hold to Buy.

Chris LaFemina, Metals& Mining Research