Why is the Fortescue share price climbing today?

A female runner climbs a set of stairs, running with strength and pace.A female runner climbs a set of stairs, running with strength and pace.

The Fortescue Metals Group Limited (ASX: FMG) share price is heading north today.

This is despite the iron ore mining outfit not releasing any price-sensitive announcements to the ASX.

At the time of writing, Fortescue shares are swapping hands at $18.24, up 2.3%.

Let’s take a look at what’s happened lately.

Iron ore prices stage a rebound

After falling more than 20% in the past month, iron ore prices have hit support to trade slightly above the psychological US$100 barrier.

According to the Australian Financial Review, the steel-making ingredient is fetching US$104.55 per metric tonne. This represents a gain of around 5.9% from Friday’s close.

Previously, iron ore touched new year-to-date lows after China established a $6 billion nationalised iron-ore company to curb sky-high prices.

The China Mineral Resources Group is expected to become the sole channel for buying imported iron ore from third parties. This includes the big three miners from Australia as well as Vale from Brazil.

Asserting some control over the market would place China in a stronger position to dictate a fairer price for iron ore.

Ultimately, this dragged down investor sentiment, which led to selling pressure for the steel-making ingredient.

Nonetheless, Fortescue shares are making a run today on the back of the latest price ascent. It appears the price of iron ore has found a floor for now ahead of the crucial United States Federal Reserve interest rate decision on Wednesday.

Other shares in miners such BHP Group Ltd (ASX: BHP) and Rio Tinto Limited (ASX: RIO) are up 1.28% and 0.94%, respectively.

For context, the S&P/ASX 200 Resources (ASX: XJR) is in the green by 0.63% to 5,009.4 points.

It’s also worth noting that Rio Tinto’s results will also be out on Wednesday, which could have a flow-on effect on Fortescue’s shares.

Fortescue share price snapshot

A volatile 12 months brought on by COVID-19 and falling iron ore prices has led Fortescue shares to tumble 30%.

Although year to date has been slightly better, despite the current external market challenges, down 7%.

Based on today’s price, Fortescue presides a market capitalisation of approximately $54.9 billion.

The post Why is the Fortescue share price climbing today? appeared first on The Motley Fool Australia.

Wondering where you should invest $1,000 right now?

When investing expert Scott Phillips has a stock tip, it can pay to listen. After all, the flagship Motley Fool Share Advisor newsletter he has run for over ten years has provided thousands of paying members with stock picks that have doubled, tripled or even more.* Scott just revealed what he believes could be the “five best ASX stocks” for investors to buy right now. These stocks are trading at near dirt-cheap prices and Scott thinks they could be great buys right now

See The 5 Stocks
*Returns as of July 7 2022

(function() {
function setButtonColorDefaults(param, property, defaultValue) {
if( !param || !param.includes(‘#’)) {
var button = document.getElementsByClassName(“pitch-snippet”)[0].getElementsByClassName(“pitch-button”)[0];
button.style[property] = defaultValue;
}
}

setButtonColorDefaults(“#43B02A”, ‘background’, ‘#5FA85D’);
setButtonColorDefaults(“#43B02A”, ‘border-color’, ‘#43A24A’);
setButtonColorDefaults(“#fff”, ‘color’, ‘#fff’);
})()

More reading

Motley Fool contributor Aaron Teboneras 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.

from The Motley Fool Australia https://ift.tt/y7HVShP

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s