IGO share price declines 7% amid commodity fears

Upset man in hard hat puts hand over face after Armada Metals share price sinksUpset man in hard hat puts hand over face after Armada Metals share price sinks

The IGO Ltd (ASX: IGO) is enduring a tough end to the week, along with many other ASX mining shares.

The diversified miner’s shares are currently down 6.93% to $9.26 despite no news out of the company.

In broad market moves, the S&P/ASX 300 Metals and Mining Index (ASX: XMM) is down 3.06% to 4,745 points in late afternoon trading.

What’s up with the IGO share price?

The IGO share price and many of its peers are struggling today as the mining sector reacts poorly to Rio Tinto Limited (ASX: RIO)’s downgrade to alumina production today.

Not only that, economists are lowering their forecasts for key industrial metals including aluminium, zinc, and nickel.

Industrial metals have fallen across the board as the US dollar continues to strengthen against all major currency pairs.

Copper fell to trade at US$7,261 on the London Metals Exchange (LME) yesterday after falling to a near two-year low of US$7,160 a day earlier.

ANZ commodity strategist Daniel Hynes said the demand picture out of China “is improving” while prices are falling, suggesting that investors are pricing in lower economic growth.

All of this has weighed on the mining sector and appears to have transposed to the IGO share price.

Meanwhile, 83% of analysts still rate IGO as a buy right now, per Refinitiv Eikon data, with 16% saying it’s a sell.

The consensus price target from this list is $12.75 per share, suggesting there’s still upside to capture.

In the last 12 months, the IGO share price has clipped a 7% gain.

The post IGO share price declines 7% amid commodity fears appeared first on The Motley Fool Australia.

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Motley Fool contributor Zach Bristow has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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