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Gold/Mining/Energy : Gold Price Monitor -- Ignore unavailable to you. Want to Upgrade?

To: long-gone who wrote (31947)	4/16/1999 9:59:00 PM
From: goldsnow	Read Replies (1) \| Respond to of 116766

Mining rush stuns traders By Bruce Hextall The mining sector was hit for its second successive day by massive buying orders from overseas institutions on Friday, sending prices to levels that left local traders stunned. At the end of trading, all the major stocks had soared after institutions decided it was time to move into the sector, having being underweight because of a poor outlook for metal prices. "This is incredible stuff. The speed of the turnaround is phenomenal," said Bell Securities' resources analyst, Mr Keith Goode. He said massive volumes showed that the largely US institutions were keen to get whatever stock they could. At the close of trade on Friday, the All Resources Index was up 74.5 points at 1187.22, making an 11.5 per cent gain for the week. Top-line stocks led the charge. BHP gained a further 85¢ to finish at $16.40 after 13.4 million shares traded; Rio Tinto added $1.71 to $26 on trade of 1.8 million shares; more than 30 million WMC shares traded, pushing the stock 93¢ higher to finish at $6.20; while North gained 35¢ to close at $3.05 on trade of 11.02 million. Even previously friendless stocks such as MIM Holdings had one of their best days. In MIM's case 41 million shares traded as the price rose 9¢ to close at 82¢. "This is not being driven by fundamentals. It's pure sentiment but volumes show it is serious money, " Mr Goode said. The rush for stocks in the resources sector was kicked off in the US on Wednesday, when the big aluminium producer Alcoa gave a bullish presentation to analysts, suggesting that markets for its products were stronger than anticipated. Alcoa's chief financial officer, Mr Richard Kelson, said that although Japan remained flat his group was beginning to see recovery in other parts of Asia, while Latin America was improving and the US market remained robust. His remarks were sufficient for the US institutions, which had no interest up to now, to decide it was time to hop back into the resources sector. Analysts also attributed the rise to a shift away from technology stocks. Having made huge profits, investors wished to diversify into cyclical stocks. The move was in anticipation of a recovery in metal prices, although most Australian analysts believe that might still be some time away because of the supply situation. Nevertheless, the copper price rose more than 3 per cent on Thursday night to a two-month high on growing confidence that demand from Asia is strengthening. The metal was trading at US67¢ - which is still not a price to make many mines profitable. "It is really a matter of what you believe," said Macquarie Equities analyst Mr Paul Barnes. "We're still saying the low point has been reached, but commodity prices will only rise when the supply situation tightens. In the US they also believe the bottom has been reached, but the recovery will be demand-driven." afr.com.au