Spotlight: Mining
Rising metal prices mean the mining sector is wielding an increasing influence on world markets. Discover the ways you can take a view on mining with IG Index.
Since the start of the global recession, rising commodity prices have increased the importance of mining stocks and raised the sector's profile. Metal-based mining stocks account for a third of the FTSE® 100’s value, with thirteen mining firms represented on the index.
Miners on the move
The mining sector is particularly sensitive to sudden fluctuations led by world events. For example, if the Central Bank of China announces it is trying to slow down its economy by raising interest rates, this will affect the price of copper, and by extension the share price of firms like Rio Tinto and Kazakhmys. Similarly, if the US dollar rises after a boom in domestic GDP then the price of gold will be affected, and so will the share prices of gold miners such as Fresnillo.
Spread betting on the mining sector
Spread betting is a great way to make the most of your interest in the mining sector. Unlike more traditional types of investment, spread betting allows you to go long or short - so you can profit regardless of the direction your chosen market takes. You can also place short-term bets, which can be useful when betting on the volatile mining sector.
There are a variety of ways to spread bet on the mining industry. As well as bets on sectors, you can take a position on individual mining shares or specific commodities.
If you’re interested in the performance of names like Rio Tinto, Lonmin and Eurasian Natural Resources – all FTSE® 100 firms – you could take a position on stock indices. Or, if Fresnillo’s share price soars as record gold prices hit the headlines, you might also want to think about where the US dollar is headed and open a forex position. For more short-term positions, you can try Binary Bets and Custom Bets which allow you to bet on indices and commodities, among others.
To take a view on the mining sector now, simply log in and place a bet. If you don’t have an IG Index account yet, apply online to start spread betting today. It takes just a few minutes, and your account is active immediately.
Mining movers and shakers
Learn more about the 13 mining firms influencing the direction of the FTSE® 100.
- African Barrick Gold
- Based in Tanzania, the company is one of Africa’s top five gold producers, with approximately 4.3 million attributable ounces of gold produced since 1999.
- Anglo American
- Global company which ranks as a top producer of copper, nickel, iron ore and coal. Produces 40% of the world’s platinum supply.
- Antofagasta
- Chilean copper mining giant which has been on the FTSE® 100 since 2004. Antofagasta’s activities are mainly concentrated in Chile where it owns and operates three copper mines with a total production in 2009 of 442,500 tonnes of copper.
- BHP Billiton
- Australia’s largest company and the largest mining firm in the world. Produces gold, petroleum, aluminium, copper, nickel, silver, uranium, iron, coal and manganese.
- Eurasian Natural Resources
- FTSE® 100 heavyweight with a diversified production portfolio of iron, aluminium, and fuels and a yearly revenue in excess of US $6.8bn.
- Fresnillo
- Mexican-based firm. Fresnillo is the world’s largest producer of silver and Mexico’s second largest gold miner.
- Johnson Matthey
- World leader in advanced materials technology. Johnson Matthey is a Chemical conglomerate which also refines and distributes platinum, palladium, rhodium, iridium, ruthenium, gold and silver.
- Kazakhmys
- Top ten copper mining firm with principal operations in Kazakhstan and business headquarters in London. Also produces zinc, silver and gold.
- Lonmin
- The world's third largest primary producer of platinum with operations based in South Africa and listings on the LSE and JSE. Produced 663,101 ounces of platinum in 2009.
- Randgold Resources
- African gold producer with operations in Mali, Senegal and the Democratic Republic of the Congo. The company has primary listings on the London Stock Exchange and Nasdaq.
- Rio Tinto Group
- Leading British-Australian mining and exploration firm producing aluminium, copper, diamonds, energy products, gold, industrial minerals and iron ore.
- Vedanta
- India’s largest non-ferrous metals and mining company producing copper, zinc, aluminium, lead and iron ore. Vedanta also has assets in Zambia and Australia.
- Xstrata
- Formerly known as Sudelektra, Xstrata is a global mining company producing coal, copper, nickel, primary vanadium and zinc. Also the world's largest producer of ferrochrome.