S&P ASX News from the Australian Stock Exchange.
Share to buy – Rio Tinto (RIO)
Since bottoming out near $38 in December, iron ore has rallied to presently be trading above $48.
- Overnight, the bulk commodity jumped 3%.
- The bounce in iron ore, unsurprisingly, has coincided with a bounce in Rio Tinto which has completed a basing pattern and now appears poised to push higher.
- We are looking for a short-term rally in Rio and active traders can consider being buyers.
Share to buy – BHP Billiton (BHP)
The big question on every investor’s lips right now is, ‘Should I buy BHP?’
The Big Australian has fallen sharply in the last 12 months, having given up half of its value.
The rout has come about due to slowing growth out of China and a subdued outlook for global economic growth.
The Samarco mine disaster in Brazil has also weighed heavily, with BHP and partner Vale expected to be footing a multi-billion dollar bill for the tailings dam failure.
These factors, coupled with massive oversupply in key iron ore and oil markets, have driven the share price south.
But commodity slumps don’t last forever; booms turn to busts and back to booms in due course.
And over the cycle, BHP has remained and will remain one of, it not the world’s best diversified mining companies, with an enviable portfolio of world-class assets.
If you have a long-term investment horizon and are willing to put up with some volatility, now could be an ideal time to revisit BHP given the depressed share price.
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Nov 2014 - Nov 2016
Our short-term focused Trading Report returned 30.03%, outperforming the ASX/200 Accumulation Index by 23.58%*
DISCLAIMER: *Performance is derived from recommendations provided by Australian Stock Report’s Trading Report, opened on or after date of acquisition in Nov 2014 *Return figures are gross returns and do not take into account fees or brokerage costs. *Returns are calculated based on a $50,000 hypothetical portfolio, risking 2% of the overall portfolio balance ($1,000) as a starting point for each trade. *Due to slippage and gapping, losses can sometimes exceed $1,000 on an individual trade. *Opening and closing prices for trades (and therefore the prices used for determining aggregate profit/loss) will be those published on the Australian Stock Report website and will be determined by the price at which they could realistically be executed in the market at the time the recommendation is published. *ASX 200 Accumulation Index Return is calculated based upon the price of the index at the start of the session on the day the first ASX 200 trade was placed, i.e. 24.11.2015
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