Fortescue share price slumps as iron ore price pulls back

The Fortescue Metals Group Limited (ASX: FMG) share price is sliding on Friday amid reports Singapore iron ore futures has pulled back from a four-week high.

At the time of writing, the Fortescue share price is $18.40, 1.6% lower than its previous close.

Its dip comes despite the S&P/ASX 200 Index (ASX: XJO) enjoying a fourth consecutive day in the green, driving it to a seven-week high.

Let’s take a closer look at what’s going on with the iron ore giant’s shares today.

Fortescue share price falls alongside iron ore

The Fortescue share price is suffering on Friday despite both the broader market and its home sector recording gains.

The S&P/ASX 200 Materials Index (ASX: XMJ) is currently up 0.7%, with the iron ore goliath coming in as one of its biggest weights.

Interestingly, the Rio Tinto Limited (ASX: RIO) share price has joined its peer in the red, slipping 0.3%, while that of BHP Group Ltd (ASX: BHP) is recording a 0.6% gain.

Fortescue’s poor performance comes amid iron ore’s about-face. Singapore iron ore futures has dumped 5% – handing back its gains from earlier this week – amid apparently disappointing news out of China, The Australian reports.

The publication claims China’s Politburo shied away from anticipated stimulus measures and used softened language when discussing economic growth targets at its latest meeting.

It did reportedly fully commit to one thing: its COVID-19 eradication strategy.

Of course, China’s growth burns up most of the iron ore produced in Australia. Thus, slower growth in the nation might dint demand for the commodity and, thus, its producer’s bottom lines.

The Fortescue share price has slumped around 8% so far this year. That’s in line with the ASX 200’s year-to-date tumble.

The post Fortescue share price slumps as iron ore price pulls back appeared first on The Motley Fool Australia.

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More reading

• Why BrainChip, Fortescue, PointsBet, and Zip shares are dropping
• 5 things to watch on the ASX 200 on Friday
• Fortescue share price lifts on record iron ore exports
• Top broker issues new warning on outlook for iron ore price
• Here’s the Fortescue dividend forecast through to 2024

Motley Fool contributor Brooke Cooper 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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