The world's top 20 mining stocks have now lost a weighted average of 68% of market value, translating into a negative $1,1trn. Shenhua, the big Chinese coal miner, has contributed $176bn of red ink to this, and Vale, the world's biggest miner of seaborne iron ore, $156bn. The two stocks are down 79% and 74%, respectively, from peak prices.
Russia's Norilsk, the world's biggest nickel miner, is the biggest percentage loser, with a stock price now 84% off peak levels. Numbers like this, some even exceeding 90%, are increasingly found among junior and exploration stocks, as the global credit, equity and commodity crisis continues to exert deadly squeezes.
Measured on the same basis, the world's top 20 oil and gas stocks have lost $2,2trn in market value, from peak prices. These stocks were holding up relatively well until this week, when heavy selling of Exxon Mobil, the world's most heavily capitalised stock of any kind, and Chevron, both components of the Dow Jones Industrial Average, set in. The weighted average loss for the top 20 oil stocks is now 58%.
Looking more broadly across the resources sector, listed oil, gold and platinum stocks have lost the least value, when measured from peaks. The losses, are, however, significant, and start around the 50% from-peak level. Listed gold stocks have lost an average 60% of value, translating to a negative $252bn in market value terms. The Tier I global gold producer sector, with 13 members, has lost an average 53% of value, translating into a loss of $114bn in market value.
As of Friday, Harmony was just a third off its peak value and ranked as the so-called best performing gold stock in the world, and one of the best performing stocks of any kind in the world. Prices for dollar gold bullion are the least under performing across the broader commodities complex, which goes some way to explaining why some listed subsectors have surrendered more than 80% of market value, when measured from peak prices.
Source: Analysis by Barry Sergeant - moneyweb.co.za
