The Fortescue Metals Group Ltd (ASX: FMG) share price is in the green today.
Fortescue shares are currently trading at $20.10, a 1.72% gain. In contrast, the S&P/ASX 200 Index (ASX: XJO) is 0.68% lower.
Let’s take a look at what could be impacting Fortescue today.
Why is Fortescue rising?
Fortescue is not the only ASX 200 mining giant on the rise today, but it is outperforming its peers. The Rio Tinto Ltd (ASX: RIO) share price is 0.37% in the green today, while BHP Group Ltd (ASX: BHP) is 1.12% higher.
Improving iron ore prices could be helping Fortescue and fellow iron ore explorers. The iron ore price climbed 0.37% to US$137 a tonne, Trading Economics data shows. This follows iron ore prices plunging 9.7% ahead of yesterday’s trade, sending the Fortescue, BHP, and Rio Tinto share prices lower.
However, Commonwealth Bank Australia (ASX: CBA) mining and energy commodities research director Vivek Dhah is optimistic about iron ore profits in the future. He places a US$120 to US$160 price target on the commodity in 2022. In comments reported by ABC, he said:
When it comes to the profitability of Australia’s iron ore sector, it is still very very strong. We sit very fortunately as the lowest cost producers of iron ore and, together with some Brazilian operations, I think that’s going to be very profitable.
The cash generation is going to be significant.
In other news, Fortescue Future Industries is on a trademark push, the Australian Financial Review reported. The company has filed 54 green energy-related trademarks in Australia. Fortescue Future Industries is the green hydrogen-related subsidiary of FMG.
Fortescue is due to release its quarterly production report tomorrow, 28 April.
Share price snapshot
The Fortescue share price has climbed nearly 5% year to date, although it is 12% lower in the past year.
In contrast, the benchmark ASX index has returned about 3% in the last year.
Fortescue commands a market capitalisation of about $61.9 billion.
The post Why is the Fortescue share price outperforming today? appeared first on The Motley Fool Australia.
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