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Featured Story
The Fight for This Obscure Copper Mine in Peru Is Your First Major Buy Signal
Most of the world isn't watching.
But they should be.
When you have giant private equity firms heatedly bidding on a copper mine, that's huge news by itself...
Add in China - the world's biggest commodities consumer, responsible for 40% of the world's copper demand - vying for the same mine, and you could be looking at an explosive spike in copper... and, of course, in the companies that get it out of the ground.
First, here's what's going on... Copper
- These Commodities Traders are Hoarding Copper for the Ultimate Profit Play There is copper hoarding going on in the metals industry, and it's giving two firms all the power and the profits. Here's how they're controlling the market. Read more... Read More...
- How a Massive Landslide Shifts Copper Supply Frank Holmes takes a look at the devastating mine disaster that shut down Bingham Canyon last week and what it means for the red metal. Read more... Read More...
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How to Double Your Money by Investing in Copper
Copper prices are up 170% over the past four years - meaning huge profits for anyone who has been investing in copper.
But now many investors are bailing on the red metal. Prices have slipped about 9% this year, and inventories are soaring.
Copper prices hit an eight-month low today (Wednesday) as slowing economic growth has led speculators to take more short positions on the metal.
Copper inventories also appear to signal low demand. Stockpiles of the red metal in the London Metals Exchange are at the highest level since October 2003.
But what appear to be bearish signals for investing in copper are not the case. Here's what investors need to understand...
To continue reading, please click here...
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Dr. Copper Leads the Breakout in Commodities Prices
Demand for commodities of all kinds is ramping up at breakneck speed. And despite fears of a slowdown in China's economic growth, Dr. Copper is leading the rise in commodities prices.
Copper earned that nickname because it's thought to be a bellwether on the health of the global economy, thanks to its numerous economic uses.
Prices slumped earlier this month after Chinese Premier Wen Jiabao cut China's economic growth target to 7.5%, the lowest since 2004. China is the world's largest copper buyer, snapping up 40% of annual supplies.
However, predictions for weak copper demand were muted on Monday, as the Asian giant reported a stream of new orders pushed factory activity to an 11-month high in March. Growth in the U.S. manufacturing sector also picked up in March, more evidence that the world's largest economy is gaining momentum. The red metal jumped on the manufacturing data and is up 13.8% year-to-date (YTD).
The news has analysts predicting demand for copper is likely to pick up steam. "The U.S. is an important market, and with the economic outlook there brightening, demand is also likely to surprise to the upside," Commerzbank AG (PINK: CRZBY) analyst Eugen Weinberg told Reuters. But Dr. Copper is just part of the story. Just take a look at what's happening in other commodity markets...
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Glencore International, Xstrata Could Make the Next Biggest Deal in Global Commodities
Commodities supplier Glencore International (PINK: GLCNF) could be on the cusp of a multibillion-dollar bet on commodities with mining company Xstrata PLC (PINK: XSRAF).
Switzerland-based Xstrata announced today (Thursday) that Glencore approached the company for an all-share offer in a "merger of equals." Glencore already owns 34% of Xstrata and wants to buy the remaining shares, worth $35 billion (21.9 billion pounds) based on Wednesday's closing price.
The result would be... Read More... -
Copper: Possible Deflation Call and Warning for Stocks
Global Economic Intersection Article of the Week
We've all heard the clich about Dr. Copper. It's so clich by now that I'd be embarrassed to even repeat it. But that cute saying has more to do with the fact that the price of copper is a relatively good gauge indicating the health of the economy, than offering a true reflection of the health of the equities markets. After all, the action in the stock markets has become so disconnected from the real economy (in essence, from 'reality') that I sometimes wonder whether the stock markets are even going... Read More... -
Buy, Sell or Hold: Freeport-McMoRan Copper & Gold Inc. (NYSE: FCX) is a Mining Play with a Major Upside
Sometimes the market offers investors a rare chance to buy shares of a great company on a dip. That's precisely the opportunity we're getting right now with Freeport-McMoRan Copper & Gold Inc. (NYSE: FCX).
The current market volatility is giving investors with an eye toward long-term investments a great chance to buy shares in a world-class company.
FCX is one of the best-run global mining companies and a great way to gain exposure to gold and copper. So it's time to "Buy" Freeport-McMoRan Copper & Gold Inc. (NYSE: FCX) (**).
And if scooping up a top-notch commodities play on a pullback isn't reason enough, here are six other reasons to buy FCX.
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China's Urban Migration Catapults Copper Prices to New Heights
The next phase of China's economic plan is fueling a relentless appetite for electricity, spiking demand for copper. That has moved investors to drive up the price of the metal, as well as the stocks of companies that mine it.
Copper has risen 14% this year, with contracts traded on the London Metal Exchange tripling since December 2008. The Bloomberg index of world mining stocks this year has climbed 16% to the highest level since Aug. 1, 2008, driven by miners like Freeport-McMoRan Copper & Gold Inc. (NYSE: FCX), and Ivanhoe Mines Ltd. (NYSE: IVN)
"Copper is red gold," Jeremy Gray, global head of resources at Standard Chartered PLC in Hong Kong told Bloomberg News. "We're on the verge of the biggest commodities bull market we have ever see."
Gray predicts the metal could rise by 50% to $12,000 a metric ton in the next six to 12 months.
Read More... - It's Time to Invest in Chile and Colombia – Latin America's Reigning 'Good Guys' Looking for the next emerging markets set to skyrocket? Look no further than Chile and Colombia. That's right, thanks to recent elections, these two countries are ready to lead growth in Latin America. Read this report to find out exactly where to invest... Read More...
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Dr. Copper's Diagnosis: A Strong Recovery
As stocks have slipped lower over the last three months, copper has bucked the broad trend and broken the pattern of lower highs and lower lows it set in the spring.
After bottoming on June 7, the iPath Dow Jones-UBS Copper Subindex Total Return ETN - which closely tracks copper futures - has gained more than 12.2%. In the same span, the Russell 2000 small cap stock index has lost 0.6%.
The red metal is nicknamed Dr. Copper for its ability to peer around the corner and act as a leading indicator for the global economy. And right now, the commodity with a Ph.D. in economics seems to be saying the future looks bright. Is the trend set to continue?
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It's Time to Invest in Chile and Colombia – Latin America's Reigning 'Good Guys'
For decades, investors with an interest in Latin America were essentially limited to two choices: Invest in countries that were moderately badly run; or invest in countries that were truly dreadfully run.
Most recently, it's been the "dreadfully run" group that seems to be attracting new members: Bolivia, Ecuador and Nicaragua have subscribed to the economic and political doctrines of Hugo Chavez's Venezuela.
However, two elections this year have created a new category of Latin American country - the "truly well run" class - and installed the first two members: Chile and Colombia. As investors, we should rejoice, make them part of our portfolio, and keep an eagle eye out for other countries that may join this promising new category - the "good guys."
For an overview of the two Latin America stocks to buy now, please read on... Read More... -
Commodities Are Key as China Continues to Call the Shots
China ended up being the big story this month, as investors looked past Europe to the Far East for clues about what shape the global recovery - if you can even call it that - is taking.
Markets around the globe tanked yesterday (Tuesday) after the Conference Board revised its leading economic index for China to show the smallest gain in five months in April. The index rose just 0.3% in April, which was a significant reduction from the 1.7% gain the Board reported on June 19.
The news of the error contributed to the biggest sell-off in Chinese stocks in more than a month, and sent U.S. indices into a dizzying downward spiral. The Dow Jones Industrial Average plunged 268.22 points, or 2.65%, to close at 9,870.30 and the Standard & Poor's 500 Index tumbled 33.33 points, or 3.10%, to close at 1,041.24.
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Question of the Week: Readers Respond to Money Morning's Afghanistan Mineral Wealth Query
The news that there is $1 trillion of Afghanistan mineral wealth hiding in the country's scarred and deserted landscape has global investors calculating how likely it would be for this incredibly poor country to transform itself into a natural-resources powerhouse.
It has also spawned debates about which nations should be given a piece of this vast apparent fortune.
The discovery - and its transformational potential - is mind-boggling: At $1 trillion, the estimated value of the mineral reserves is 100 times the size of Afghanistan's entire economy, estimated at $12 billion. And it's not just the dollar figures that could bring about change. Much of Afghanistan's economic activities involve drug-trafficking and terrorism. About 40% of the country's population lives below the poverty line, and 70% lives on $2 a day.
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We Want to Hear From You: Is Afghanistan's Mineral Wealth a Blessing or a Curse?
The news that there is $1 trillion of Afghanistan mineral wealth hiding in the country's scarred and deserted landscape has global investors calculating how likely it would be for this incredibly poor country to transform itself into a major global exporter.
It has also spawned debates about which nations should be given a piece of this potential fortune.
At $1 trillion, the estimated value of the mineral reserves is 100 times the size of Afghanistan's $12 billion economy. And it's not just the dollar figures that could bring about change. Much of Afghanistan's economic activities involve drug trafficking and terrorism. About 40% of the country's population lives below the poverty line, and 70% lives on $2 a day.
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Will Afghanistan's Mineral Wealth Bring the Nation's Rebirth or a Commodities Curse?
Overnight, Afghanistan has gone from being a political pariah to one of the most significant, and potentially richest, countries on the globe. But can the rocky, war-torn desert - known mostly for harboring terrorists and exporting opium - be reborn as a major commodities exporter?
U.S. geologists have found some $1 trillion of untapped mineral deposits in Afghanistan, The New York Times reported Sunday. Afghanistan's mineral wealth includes large caches of iron, copper, gold and lithium that could turn the country into one of the most important mining centers in the world.
Think of Australia, Canada, and Latin America. That is the league into which these geographical revelations have thrust Afghanistan.
"There is stunning potential here," General David Petraeus, commander of the United States Central Command, told The Times. "There are a lot of ifs, of course, but I think potentially it is hugely significant."
Those "ifs" include ongoing warfare, a lack of infrastructure, and more than a little political corruption. But the upside for the country is enormous.
While U.S. officials estimate the potential value of Afghanistan's mineral wealth at $1 trillion, President Hamid Karzai said last month during a visit to Washington that his country's deposits could be worth three times as much.
So why did it take so long for this information to surface? Read More...