Even as the price of big iron’s only product continues to crater, the share prices of miners continue to rise. The inescapable conclusion is that iron ore miners have perfected a new technique for feeding cows into blast furnaces to make steel. Hence the new trade in beef ore is going to send earnings through the roof. Thus BHP soaring 2.6%, RIO putting on 1% and the cow king FMG adding 2.4% is right on the money:
The transition to cow ore is very well timed given there has been very good recent price gains in beef prices even as Dalian iron ore futures open down another point this morning. Phew!
Big gas meanwhile is under-performing after a racy night for Brent with WPL up 0.4%, OSH is now on a charge having broken out (more on that below), STO is down 1.4%, ORG is up 1.6% but poor old LNG continues to sink as the dream evaporates (hint, hint, transition to cows):
Here’s the OSH chart:
It’s broken the downtrend and the first resistance point is around $8.50. If it can get above that, which I doubt, then it can run at former highs.
But really, for big gas to get this recovery going it also needs to move into LNCG, liquefied natural cow gas.
