Freeport-McMoRan dips as UBS says copper 'super cycle' lacks China support, downgrades

Brand 24 SA

21/04/2021 15:34

** Freeport McMoRan  FCX.N  shares down 0.7% to $35.62 as
UBS downgrades to "neutral" from "buy"
    ** "We assess the much discussed copper super cycle does not
have as much China support, as perceived," UBS writes in
research note
    ** As economic recovery continues, China's government
tightening construction stimulus which historically has proven
net negative for materials, UBS says
    ** Adds country's government unlikely to restock state
inventories this year, which significantly lowers demand
    ** Still, UBS increases 2021 copper price estimate to
$3.83/lb from prior $3.50/lb
    ** As such, brokerage hikes FCX PT from $30 to $36 to
account for higher copper prices, says downgrade based on rally
in shares
    ** With move on Weds, FCX up ~37% YTD and has surged ~380%
over the past one year
    ** 16 of 21 analysts covering FCX rate stock "buy" or
stronger, rest are neutral; median PT is $40 (Refinitiv data)

 (Lance Tupper is a Reuters market analyst. The views expressed
are his own)
 ((lance.tupper.tr.com@reuters.net
lance.tupper@tr.com 1-332-219-1430))