Technical Coverage on Freeport McMoRan and Southern Copper - Copper Rising - The Road Ahead
04 Feb, 2013, 13:00 GMT
LONDON, February 4, 2013 /PRNewswire/ --
Copper has started seeing an upward growth trend since last Monday. On January 29th, it rose by 0.5 percent to $8,089 a metric ton on the London Metal Exchange. Established copper miners like Freeport McMoRan Copper & Gold Inc (NYSE: FCX) and Southern Copper Corp. (NYSE: SCCO) are reporting mixed results. StockCall analysts have finished the technical reports on Freeport McMoRan and Southern Copper, and these free reports can be accessed upon signing up at
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Factors Driving Growth
Expected growth in the United States economy is the main driving forces for rise in copper. Good economic growth will push production and demand for copper will increase.
Manufacturing is more stable now and jobs are increasing. Durable goods consumptions recorded continuous growth for the fourth month in a row. U.S. companies are planning new investment models but remain concerned of a probable tight fiscal policy. However, the Fed has stated that it plans to keep short-term interest rates low for as long as unemployment rate does not fall back to 6.5% from the current value of 7.8%. Investors are waiting for more U.S. economic reports and Federal Reserve Policy Decisions.
Expectations from McMoRan Copper & Gold and Southern Copper
Freeport McMoRan expects a substantial increase in copper production supported by strong financial results. Its shock rose by 5% on January 22nd as the company reported 78 cents per share of earnings. The quarterly revenue experienced a year-on-year growth of 8%. The company projects a growth in copper production from 3.66 billion pounds in 2012 to over 5 billion pounds in 2015. Freeport McMoRan Copper & Gold is expecting a year-on-year growth of more than 7% for copper sales in the North American market. Our free research on Freeport McMoRan is available free of charge by registering today at
http://www.StockCall.com/FCX020413.pdf
Southern Copper Corp. raised copper production by 7% in the first half of 2012 and in 2013 copper production is expected to go up by 4.6%. The revenue and earnings per share are seeing a decline for the last three quarters. Even the estimates for 2013 are depressing. The company stock is trading at 11% below the $44 value in January 2012. The debt levels are $16 billion. The company is not able to fight the global slowdown in demands and increasing pressure from competitors. Its copper production is increasing but its overall growth is slowing down. Download the free research on Southern Copper today by registering with us at
http://www.StockCall.com/SCCO020413.pdf
Conclusion
A mixture of key elements is operating in major economies around the world with the potential to drive results either way. Though demand for copper has started increasing owing to better economic conditions, supply is surging as well.
Copper is expected to continue growing in the near future as positive economic data from China and the United States is pulling demands up. However, copper mining companies are also expecting to scale up their production in the coming months because of strong fourth quarter performance. Future prospects depend on fiscal and monetary policies of the U.S. government.
At this moment in time, there is a need for well planned economic policies which can strike a balance between demand and supply forces. Long-term growth for copper will mainly depend on how willing the governments are to achieve this.
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