LSB top list; Mechel falls as Russia attacks Ukraine
The S&P 500 Materials sector ended this trading week lower -0.24%while the materials select the SPDR sector (NYSEARCA:XLB) was up +0.11%.
Industrial metals are up across the board this week on the back of Russia’s invasion of Ukraine, along with aluminum prices (LMAHDS03:COM) hit a record high of $3,450/ton and nickel (LN1:COM) Jumped to a decade high of $25,000/tonne on the London Metal Exchange.
Russia is the world’s second-largest aluminum exporter, and the war in Ukraine threatens supplies already thin on the ground from strong demand and shrinking inventories. Recent sanctions have so far locked out Russia’s energy and aluminum sectors. However, subsequent sanctions could lead to high energy prices, which would increase production costs for aluminum and other base metals.
The Ukraine crisis also triggered a jump in gold futures to the highest since early 2021 and on track for their biggest daily rally in about two years. April Comex Gold (XAUUSD:CUR) surpassed $1,970/oz, the highest for most active contract execution since January 2021, during silver in March (XAGUSD:CUR) reached $25.50/oz.
Take a look at this week’s biggest gainers and losers among basic materials stocks (market cap of $300 million or more):
LSB Industries (NYSE:LXU) +31.51%; Shares are up after a modest fourth-quarter profit decline, and the company expects demand for agricultural products “to remain resilient in 2022 after a very strong 2021.”
Benson Hill (NYSE:BHIL) +17.83%; The company’s preliminary results for 2021 point to better-than-expected consolidated sales, which also beat the previous forecast.
Olympic steel (NASDAQ:ZEUS) +14.18%; Olympic Steel reported fourth-quarter profits and sales that beat estimates, marking 2021 as the “most profitable year” for the company.
Rayonier Advanced Materials (NYSE:RYAM) +12.00%; Rayonier missed Q4 estimates, but revenue for FY21 rose 5% to just over $1.4 billion. The company also reduced debt by over $155 million and increased cash on hand by nearly $160 million.
MP materials (NYSE:MP) +11.63%; MP also posted a profit surplus in the fourth quarter and was able to more than double sales compared to the same quarter last year.
Mechel PAO (NYSE:MTL) -39.02%; The Russian mining and metals leader appears to have been affected by the war in Ukraine.
new gold (NYSE:NGD) -15.00%; Shares fell despite reporting Q4 results showing the strongest production quarter of the year and the lowest from a cost perspective.
Orion Engineered Carbons (NYSE:OEC) -12.83%; Earlier this week, the company announced plans to increase prices on all specialty carbon black products due to rising raw material, operational and supply chain costs.
Nah (NYSE:NP) -11.87%
Bioceres plant solutions (NASDAQ:BIOX) -11.72%
Other material ETFs to keep an eye on: iShares Global Timber & Forestry ETF (NASDAQ:WOOD)Materials Select Sector SPDR ETF, Vanguard Materials ETF (NYSEARCA:VAW)iShares Global Materials ETF (NYSEARCA:MXI)SPDR S&P Metals & Mining ETF (NYSEARCA:XME)VanEck Vectors Gold Miners ETF (NYSEARCA:GDX)iShares MSCI Global Gold Miners ETF (NASDAQ:RING)Global X Copper Miners ETF (NYSEARCA:COPX).