Iron stocks tops list; Lithium stocks drop to bottom


Iron mining

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The S&P materials sector closed -1.61% this week, with the S&P 500 down -0.69% and the Materials Select Sector SPDR ETF (XLB) -1.55%.

Iron ore futures (SCO:COM) +6.42% wrapped up their third straight weekly rise Friday, as top steel producer China’s latest moves to shore up its economy, including easing strict COVID-19 restrictions, have brightened demand prospects.

Front-month Comex gold (XAUUSD:CUR) for November delivery was down -1.18% to end the week at $1,750.20/oz. Prices had dropped with “the dollar bouncing off its lows after plunging in the aftermath of another inflation surprise,” as the U.S. reported wholesale prices rose by a smaller than expected 0.2% in October.

Three-month copper prices (HG1:COM) saw a big dip this week, declining -8.38%. Futures on the London Metal Exchange fell as a spike in COVID-19 cases in top metals consumer China and hawkish comments by Fed officials stoked demand concerns.

This week’s top gainers among basic material stocks ($2B market cap or more) benefited from a strong five-day performance of iron:

  • Sylvamo (SLVM) +6.09%
  • Grupo Simec (SIM) +5.37%
  • Steel Dynamics (STLD) +4.54%
  • Alpha Metallurgical Resources (AMR) +4.68%
  • Ashland (ASH) +4.09%

This week’s top losers among basic material stocks were all lithium stocks that were under pressure following a selloff in Asian lithium producing peers on rumors of production cutbacks at a major Chinese producer of cathodes.

  • Sociedad Quimica y Minera de Chile (SQM) -17.98%
  • Sigma Lithium (SGML) -14.99%
  • Livent (LTHM) -13.60%
  • Albemarle (ALB) -12.39%
  • Lithium Americas (LAC) -10.64%

Other materials ETFs to watch: iShares Global Timber & Forestry ETF (WOOD), Materials Select Sector SPDR ETF, Vanguard Materials ETF (VAW), iShares Global Materials ETF (MXI), SPDR S&P Metals and Mining ETF (XME), VanEck Vectors Gold Miners ETF (GDX), iShares MSCI Global Gold Miners ETF (RING), Global X Copper Miners ETF (COPX).

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