The Australian Stock Market defied the weak jobs data yesterday, finishing up 1.2% with miners among the best performers.
One of the primary catalysts was the stunning results from Rio Tinto which broke production records in iron ore, bauxite and thermal coal.
Today should be another good day for the miners after Citibank overnight changed its rating on mining stocks from neutral to buy.
While we remain concerned about the potential long-term structurally demand story for commodities in China, and we are cognisant of a potentially seasonal slowdown in the first quarter of this year, our move reflects better bottom up fundamentals, particularly from the major miners. We would rather be too early than too late in making this call.
BHP received a specific buy recommendation which should help it in Australian trade today.
Mining stocks have been out of favour for some time and the Australian stock market has underperformed the rises in the other big developed markets over the course of the past 12 months.
Things might be about to improve for Australian investors.