Category: Financial Markets
Despite strong optimistic sentiments, Bitcoin (BTC) experienced corrections at the start of the week, falling by 6% as of 9 a.m. IST to close at $39,700.
BTC stayed above $41,000 for the majority of the day until being dragged down by the bears in the early hours of Monday. If the downturn continues, BTC may shortly test its first support at $39,000.
BTC trade volume surged by more than 7% across all exchanges.
Ethereum (ETH) was down 0.8% this week, although it maintained its gains from the previous week. It closed at $2,560, slightly over the $2,530 barrier mark. It is developing support levels at $2,330 and $2,250.
Polygon (MATIC), Stellar (XLM), and Theta (THETA) are among the major altcoins that have lost 5-7 percent in the last 24 hours, while others have lost 3-4 percent.
BTC is expected to bounce back from its present support level of $42,000 this week, with the 20-week moving average being tested afterwards. If BTC maintains its position, ETH’s hard fork, which went live on August 4, should continue to fuel momentum in the larger altcoin market.
(Source: Morningstar)
General Advice Warning
Any advice/ information provided is general in nature only and does not take into account the personal financial situation, objectives or needs of any particular person.
Iron ore fines and pellets production surpassed the previous quarter by 11% to 84 million tones, supporting sales volumes to a total of 75 million tons, up 14% from the previous quarter. Elevated prices for Vale’s most important commodity more than offset a hit to cash costs from higher maintenance, equipment, and transportation costs. At our unchanged fair value estimate of USD 19, Vale’s shares trade at a 10% premium with the elevated iron ore price more than compensating for any residual concerns about their tailings dam disasters.
This quarter, Vale realized a sky-high average iron ore fines price of USD 183 per ton, up from USD 89 per ton at the same time last year. Vale is poised to ramp iron ore output in the second half with dry season and full capacity signaled from Serra Leste and Fábrica mines supporting the group’s unchanged full year target. Currently, production capacity is at 330 million tones and this is on track to increase to 400 million tons by the end of 2022, and to 450 million tones thereafter. This will ensure reliable supply is available, providing a buffer to unexpected operational challenges and swing capacity to meet strong demand.
Advancements have also been made in Vale’s base metals business. The Reid Brook deposit as part of the Voisey’s Bay Mine Expansion project has started production. The project represents a small step in the portfolio towards electrification and decarburization, but the investment is dwarfed by the importance of iron ore to Vale.
Company’s Future Outlook
We expect strong profitability to continue into the second half, principally a function of the still-lofty iron ore price. Nickel and copper suffered from the Sudbury labor disruptions causing stoppage expenses and softer production. Vale has put their nickel and copper guidance for the full year under review and we’ve reduced our full year group volume forecasts by 10% to 15%. However, with Returns and earnings from iron ore currently so strong, we View the impact as negligible. The second part of the project, Eastern Deeps mine, is expected to start up in the second half of 2022. By 2025, the two mines are anticipated to contribute to an additional annual production of 40,000 tons of nickel, 20,000 tons of copper and 2,600 tons of cobalt as by-products
Company Profile
Vale is the world’s largest iron ore mine and one of the largest diversified miners, along with BHP and Rio Tinto. Earnings are dominated by the bulk materials division, primarily iron ore and iron ore pellets, with minor contributions from iron ore proxies, including manganese and coal. The base metals division is much smaller, primarily consisting of nickel mines and smelters with a small contribution from copper.
(Source: Morningstar)
General Advice Warning
Any advice/ information provided is general in nature only and does not take into account the personal financial situation, objectives or needs of any particular person.
