The world’s biggest mining companies soared in overnight trade

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Anglo American just had its best day ever, while BHP and Rio Tinto continued their rally in London overnight, as mining companies listed in Britain smashed higher, after a rare strong day overall for the commodities industry.

The FTSE 350 Mining Index, which tracks the performance of the UK’s biggest listed mining and commodity firms closed the day up by more than 11%, and saw its biggest single day gain in six years, with individual stocks rising as much as 20%.

After rallying 8.2% and 8.9% respectively in ASX trading yesterday, BHP and Rio Tinto continued their gains in London overnight. At the close BHP was 10.79% higher while Rio Tinto ended the day up 10.27%.

That sets up further gains for both companies, and the cohort of locally listed miners in materials index on the ASX today.

Overnight Glencore — one of the firms most affected by the slump that has seen the price of raw materials fall by more than 60% since 2011 — saw its shares pop 16%, up more than 13p, and coming close to passing the £1 mark for the first time since November last year. That’s despite the company being given a rating downgrade by S&P to BBB-, just one notch above a ‘junk’ rating.

Glencore’s surge on Thursday was nothing in comparison to that of Anglo American, the world’s biggest platinum. Shares in the miner soared by as much as 25% on the day, before finishing up by 19.7%, the best single day performance in its history. Here’s how that looked:

Anglo feb 4

Anglo is in the midst of an horrific couple of years, and in December announced a “radical” restructuring to save the company from total crisis. In 2015, shares in the company won the FTSE 100’s wooden spoon, ending the year down by upwards of 70%.

Anglo and Glencore weren’t the only miners to pop however, and shares in all five of the FTSE’s biggest mining firms jumped by more than 10%. Here’s the scoreboard:

  • Antofagasta — up 14.56%
  • BHP Billiton — up 10.79%
  • Rio Tinto — up 10.27%
  • Fresnillo — up 8.59%
  • Vedanta Resources — up 9.22%
  • Randgold Resources — up 3.13%

The mining sector’s massive surge on Thursday was driven by a big rebound in the price of metals, thanks to a bounce in the price of oil, and the continuing dip that the dollar is undergoing right now. Metals across the board saw big gains, with gold up more than 1.15%, passing the $1,150 per ounce mark. Platinum, one of Anglo American’s biggest markets, jumped 2.5% on the day.

This morning, with the massive rally in its early stages, Mike van Dulken Head of Research at Accendo Markets, said (emphasis ours):

Retail investors are rushing back into FTSE 100 miners, jumping on momentum from a weak USD inspired by hopes the Fed dials back on its hawkish trajectory for US rate rises. Gains may be despite little change on the commodity supply glut front, however, it would appear that an increasing faction views the sector as having seen the worst, on its way back from oversold and on the right track in terms of painful measures to correct structural issues.

Overall, the FTSE 100 ended the day up 1.05% to close at 5,898 points, with pharma giant AstraZeneca and Imperial Tobacco propping up the index. Across the rest of Europe, it was a mixed bag, with most major indexes in the green, but some seeing small losses. Here’s the scoreboard:

  • France’s CAC 40 — up 0.09%
  • Germany’s DAX 30 — down 0.45%
  • Spain’s IBEX 35 — up 1.86%
  • Italy’s FTSE MIB — up 1.19%
  • Eurostoxx 50 — up 0.37%
  • Portugal’s PSI 20 — down 0.11%

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