Mining, Metals Stocks Rise in Europe as China Delays Rate Move
By Stuart Wallace
May 19 (Bloomberg) -- BHP Billiton, Anglo American Plc and
other mining and metals stocks surged in London after China said
it will hold off from raising interest rates, indicating that the
nation's demand for commodities won't plunge any time soon.
Chinese inflation remains below 5 percent and policy makers
want more time to assess the effectiveness of measures taken so
far to cool an investment boom, central bank Governor Zhou
Xiaochuan said. China accounts for a quarter of world consumption
of traded iron ore and a sixth of its copper and aluminum.
``The China fears seem to have subsided for the moment,''
said Martin Squires, a mining analyst at J.P. Morgan Securities
Ltd. in London. ``There has been a lot of concern about tightening
but we are far from subscribing to any hard landing in China. None
of the trade contacts I speak to see any concern about China on
the demand side.''
Shares in Melbourne-based BHP Billiton, the world's biggest
mining company, were up 19 pence, or 4.4 percent, at 455.5 pence
as of 10:42 a.m. in London. London-based Anglo American, the
world's second-largest mining company, rose 52 pence, or
4.9 percent, to 1,124 pence.
Rio Tinto Group, based in London, added 53 pence, or
4.3 percent, to 1,279 pence. Antofagasta Plc, the London-based
operator of three copper mines in Chile, rose 62 pence, or
7.4 percent, to 898 pence. Xstrata Plc of Zug, Switzerland, the
world's fourth-largest coal exporter, was 37 pence, or
5.9 percent, higher at 664.5 pence.
Mining stocks also rose after metals such as copper gained on
the London Metal Exchange. U.S. building permits, a measure of
future construction, climbed 1.2 percent in April, indicating
rising mortgage rates have yet to curb demand for new homes, which
use copper wiring and pipes.
A fire at a Kazakhstan copper mine owned by Kazakhmys Corp.,
reported by Reuters, helped boost copper prices today. Kazakhmys,
part-owned by South Korea's Samsung Corp., produces more than
400,000 metric tons of copper from 12 mines in Kazakhstan, the
news service said.
Copper Rises
Copper for delivery in three months was 1 percent higher on
the LME, the world's largest metals bourse, at $2,547 a ton.
Shares in European steelmakers rose after the International
Iron and Steel Institute in Brussels said they raised production
for a third month in four, seeking to benefit from higher prices.
Prices for benchmark hot-rolled coil exported from the EU
have gained 62 percent this year. Arcelor SA of Luxembourg, the
world's No. 1 steelmaker, has said some of its prices will rise by
at least 15 percent in the third quarter, twice the rate of
increases in January and April.
Arcelor shares were 76 cents, or 6 percent, higher at 13.52
euros in Paris. ThyssenKrupp AG, Germany's largest steelmaker,
added 58 cents, or 4.5 percent, to 13.59 euros in Frankfurt. Corus
Group Plc, the U.K. largest steelmaker, was 0.25 pence, or 0.8
percent, higher at 32.5 pence in London.
--With reporting by Tian Ying. Editors: Farr
Story illustration: To see a series of functions related to BHP
Billiton stock, see {BLT LN <Equity> CNP00094090102 <GO>}. For
Top Commodity news, see {CTOP <GO>}.
To contact the reporter on this story:
Stuart Wallace in London (44) (20) 7673-2388, or
swallace6@bloomberg.net.
To contact the editor on this story:
Stephen Farr at (44) (20) 7673-2640 or sfarr@bloomberg.net |
