Shares A Mine Of Trouble

The Tradefair Trader / Editor / 02 July 2008 / Leave a comment

SHARES?

Nicola Horlick says not to bother. Horlick is the City "super woman" who has 19 children, milks the cows when you're going to bed, and when she's not paragliding into war zones carrying boxes of Black Magic in her teeth heads Bramdean Asset Management.

Yesterday the FTSE-100 index of leading shares plunged 146 points. The Horlick factor? Not unless Horlick also does a decent turn as a dead cat. After the plunge, the FTSE 100 bounced, to end the session 53 points lower at 5,426.3 - a fall of 1 per cent.

The Footsie is well down on its 6730.7 last autumn. It's almost a bear market.

And leading the run into the woods are mining stocks. Copper mining firm Antofagasta lost 7.9 per cent to 568p, while Eurasian Natural Resources fell 9.4 per cent to £10.65.

The Tradefair spread has Antofagasta on 569.1 - 571.9. The sell looks a shoo-in. The global price of copper remains close to all-time highs, but Antofagasta production costs are very high, what with oil and energy prices. The focus is on holding down costs.

ENR's spread is 1060.3 - 1062.7. A buy on the UK-listed Kazakh miner? ENRC's share price has risen 145 per cent since it floated. Not too shabby.

It's backed by the Kazakh government, and likely to merge with Kazakhmys, the other big player in exploiting the country's massive reserves of ores and minerals.

Over in the US, the US dollar is flirting with record lows against some major currencies.

Oil goes up and up some see it as a vote of no confidence in the dollar. An easy correlation - too easy - but one worth considering.

And with oil on the slide, the dollar could fall more. On Tradefair the sterling/dollar spread is 1.9929 - 1.9932. Can it break two dollars? Yes. But a battery of corporate news hit the pound on Wednesday, sending the currency lower across the board.

Good luck...