Morningstar still at $22

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DJ Chinese Real Estate Key to Commodities Market - Morningstar -- Market Talk

2318 GMT  [Dow Jones] "As China goes, so go many industrial commodities,"
cautions Morningstar's Jeffrey Stafford. Improved headline GDP in China comforted
many investors. It shouldn't have, he says. He argues the figures don't yet
reflect real estate troubles but likely will soon. The Chinese real-estate slowdown has
already put pressure on prices for globally fungible commodities such as iron ore and
copper, and that's unlikely to abate, he adds. Because of China's appetite for
commodities, its economic activity and fixed-asset investment is a good gauge of
commodity market health. Stafford notes that currently, the basic materials sector is
trading very close to fair value. Morningstar's top sector picks are Newcrest Mining
(NCM.AU), with a A$22/share fair-value estimate, Alumina (AWC.AU) with a A$2.60/share
estimate and Rayonier Advanced Materials (RYAM) with a $49/share estimate.
([email protected]; Twitter: @RobbMStewart)

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  (END) Dow Jones Newswires
  September 30, 2014 19:18 ET (23:18 GMT)
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Wednesday 01 October 2014 09:18:00.000 AEST