Event Raw material prices are starting to move. Iron ore prices and coking coal prices have strengthened and this will help to drive equities higher. Key things to focus on at the moment include; ? Restocking demand in China is starting to gain momentum. ? There are a number of logistics issues cropping up in major exporting regions. These predominately relate to weather conditions. ? Traders are getting nervous, hence buying into markets to improve inventory levels. ? It appears to be getting colder in Northern China; so, this will drive thermal coal restocking and could push prices higher. The Commodity team's upgrades were well timed and we continue to push iron ore, coking coal and thermal coal names on the back of these upgrades. Impact This week we continue to see clients wanting to get involved in the rally. We push the bulk names across Asia but we also look for stocks that are fundamentally well placed in the event this rally runs out of steam. We push some of the bigger names with a bias towards iron ore, thermal coal and copper. We like coking but it is more complicated to play, given the equities. Stocks have had a rally but there is more to come.
AGO Price at posting:
$2.59 Sentiment: Buy Disclosure: Held
