Mining shares aren’t the dirt-cheap bargains they were a year ago, but still have room to rise in 2017. A pick up in global growth coupled with less in the way of new production should support metal prices this year, observers say.
While nobody sees stock-price gains to match last year – when Barrick Gold Corp. doubled, Glencore PLC tripled and Teck Resources Ltd. quintupled – the sector still seems reasonably priced and could benefit from factors ranging from Trumponomics to momentum trading.
“We think 2017 should be a positive year for miners,” Jatinder Goel and other Citigroup analysts wrote in a report this week. “We believe most commodities are moving up the recovery curve,” concurred David Gagliano and his team at Bank of Montreal.
To be sure, the gains are likelier to be spottier than last year, when just about every industrial commodity climbed in price and gold advanced as well, despite a slide late in the year.
But while some raw materials may fade from last year’s peaks, “the overly bearish sentiment that plagued the entire commodity complex in late 2015 and early 2016 is behind us,” Mr. Gagliano wrote in a recent report.
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