Market Report: Commodities giant Glencore at an all-time low


Click to follow
The Independent Online

Down, down, deeper and down. The Status Quo lyrics might be sounding in Ivan Glasenberg’s head. After floating at 530p in 2011, his commodities giant Glencore is now at an all-time low of 106.35p, finishing down 10.63 per cent.

More concerns about global growth, especially in China, depressed mining stocks, with Credit Suisse heaping more misery on the sector with a gloomy note full of downgrades. Analyst Liam Fitzpatrick said: “Until China demand and emerging market currencies find a floor, it will remain challenging to put an absolute floor on commodity prices.”

He slashed his target price for Glencore to 175p, adding that it “suffered a complete loss of confidence from investors” after the recent £1.6bn share placing at 125p.

Peers Anglo American, down 46.8p at 648.1p, Rio Tinto, 80.5p off at 2,194p, and BHP Billiton, 54.5p lower at 1,021.5p, all suffered from Credit Suisse downgrades. FTSE 250 copper miner Kaz Minerals fell 35.3p to 104.4p for the same reason.

The sector-wide sell-off hit the FTSE 100, which slid 2.8 per cent to 5,935.84.

The only blue-chip riser was insurer RSA, up 2.9p to 406.2p as traders sniffed out a bargain a day after Zurich pulled out of a takeover, causing a 21 per cent share slump on Monday.

Business incubator Allied Minds, which counts Neil Woodford’s fund as a backer, plummeted 79.1p  to 435.9p as US hedge fund Kerrisdale tore the investment proposition apart in a 28-page report. “Allied Minds is … a dressed-up collection of high-risk, low-reward gambles that we believe has at least 70 per cent downside,” it said, while admitting that it and others are short-sellers, meaning they will cash in on the stock’s decline.

Cenkos, recently ousted as nominated adviser to Quindell by the new management, jumped 10.5p to 177p as the broker revealed plans to return £8m of spare capital to shareholders.

Its half-year results reflected a tough time for AIM companies, with revenues down 19 per cent to £53.1m and pre-tax profits  21 per cent lower at £18.6m.