Category: Stock Market

The price of lithium continued to rage higher during the first quarter of FY22, sending ASX lithium shares skyward. This generally meant if you owned shares in a lithium producer/explorer, you enjoyed a rewarding quarter.

In fact, lithium shares bucked the trend across the broader materials sector in Q1. Looking at the S&P/ASX 200 Materials Index (ASX: XMJ), the sector was pulled down 10.5% over the 3-month duration. This was mostly from heavy losses in iron ore producers including BHP Group Ltd (ASX: BHP), Fortescue Metals Group Limited (ASX: FMG), and Rio Tinto Limited (ASX: RIO).

To grasp an understanding of which ASX lithium shares delivered the goods we need to take a closer look.

Outsized returns from these ASX lithium shares

While the S&P/ASX 200 Index (ASX: XJO) barely budged in the first quarter (increasing 0.26%), lithium companies went for a run. A large chunk of the euphoria stems from the unrelenting surge in the price of the battery-making chemical element.

According to Trading Economics, the price per tonne of lithium carbonate skyrocketed from approximately 88,800 Chinese yuan to 165,000 yuan during the quarter. This is on top of the strengthening in lithium prices that had been playing out since late 2020.

As a result, investors flocked to Aussie companies set to benefit the most from this continuing trend. In response, the majority of lithium shares on the ASX experienced upwards movement. The company undergoing the strongest share price appreciation during the quarter was AVZ Minerals Ltd (ASX: AVZ). Over the 3-month period, AVZ surged around 110% in value.

Adding to the optimism, in September AVZ announced a transaction implementation agreement with Suzhou CATH Energy Technologies, which would see CATH pay US$240 million in a joint venture to kickstart the Manono Lithium and Tin Project.

Following closely behind, these 5 other ASX lithium shares delivered outsized returns to their shareholders in Q1 FY22:

• Ioneer Ltd (ASX: INR) up 90.9%
• Liontown Resources Limited (ASX: LTR) up 77.8%
• Vulcan Energy Resources Ltd (ASX: VUL) up 66.6%
• Pilbara Minerals Ltd (ASX: PLS) up 40.9%
• Orocobre Limited (ASX: ORE) up 34.9%

Interestingly, Elon Musk, CEO of Tesla Inc (NASDAQ: TSLA), shared his thoughts on lithium in the company’s annual general meeting this morning.

Musk and his company don’t foresee any lithium supply shortages, stating: “There’s lithium everywhere, so that’s not an issue. Also, lithium is maybe only 1 or 2 per cent of the [battery] cell.”

Lagging the pack

Although the far majority of ASX lithium shares experienced strong price appreciation, there was an exception. Specifically, Piedmont Lithium Inc (ASX: PLL) took a 30.1% tumble during the quarter.

This disappointing move coincided with difficulty winning over residents near its proposed open-pit lithium mine in Gaston Country, North Carolina. During a presentation in July, residents expressed discontent towards the mine proposal set out by Piedmont.

Additionally, the ASX lithium share took another hit following a class-action lawsuit being filed against it. As a result, Piedmont shareholders have missed out on the same gains that other lithium producers enjoyed.

The post How did ASX lithium shares perform in the FY22 first quarter? appeared first on The Motley Fool Australia.

More reading

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• US warns Evergrande crisis could affect ‘entire world’
• ASX 200 (ASX:XJO) midday update: EML crashes, mining shares rise
• What happened on the US stock market last night?
• October is ‘crash’ month: Will history repeat for the ASX 200?

Motley Fool contributor Mitchell Lawler owns shares of Tesla. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and has recommended Tesla. 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 Bruce Jackson.

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The Magellan Financial Group Ltd (ASX: MFG) sahre price is having a pretty happy day this Friday. Magellan shares are, at the time of writing, trading at $33.55 each, up a healthy 4.48% so far today.

But if we put that in just a little bit of context, it doesn’t look quite as good as it might seem. It was only yesterday that Magellan, one of the ASX’s largest fund managers, hit a new 52-week low of $31.34 a share. That’s the lowest Magellan shares have been since early 2019.

This descent into these new lows seemed to have been sparked by Magellan’s latest funds under management (FUM) report. On Wednesday this week, Magellan announced that its FUM for the quarter ending 30 September (the first quarter of FY2022) came in at $113.3 billion.

That was a decline of roughly $600 million from where it stood at the start of the quarter. It also represented a fall of $4.7 billion from where Magellan’s FUM was at the end of August.

This obviously wasn’t good news for the company, and investors seemed to have reacted accordingly.

But now that Magellan shares are sitting just a few percentage points off of their new 52-week low, some investors might be wondering if this is a sitting bargain.

Well, we have some insights on that question today.

Could the Magellan share price be a buy today?

As my Fool colleague James covered yesterday, the Magellan share price is looking attractive to the broker Macquarie. Macquarie has retained an ‘outperform’ rating on Magellan shares, albeit with a reduced 12-month share price target of $38. That still implies a potential 12-month upside of close to 15%.

Although, as we covered yesterday, Macquarie is still worried that Magellan’s FUM will remain under pressure for at least the rest of FY22, it still thinks the shares are “too cheap to ignore” right now. Macquarie is also eyeing the possibility of a dividend yield of 7% or so in FY22.

Macquarie isn’t the only broker bullish on Magellan either. According to reporting in today’s Australian Financial Review (AFR), another leading broker sees an even more optimistic 70% upside for the company.

At the current Magellan share price of $33.4, this company has a market capitalisation of $6.19 billion, a price-to-earnings (P/E) ratio of 23.13 and a dividend yield of 6.32%.

The post Here’s why these top brokers reckon the Magellan (ASX:MFG) share price is cheap appeared first on The Motley Fool Australia.

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• The Magellan (ASX:MFG) share price is in focus on $1.5 billion FUM outflow
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Motley Fool contributor Sebastian Bowen 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 Bruce Jackson.

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The Metcash Limited (ASX: MTS) share price is sliding lower this afternoon. The shares are now changing hands at $3.98 apiece, down 0.74%.

Metcash shares are on the move as the company announced a key management restructure earlier today. Here’s what we know.

What did Metcash announce?

Metcash advised its Group CEO, Jeff Adams, informed the board of his intention to retire from the wholesale distribution company’s top gig.

The release says Doug Jones, “currently CEO and senior vice president of South African-based Massmart Wholesale”, will step into the role next year.

Adams originally joined Metcash in 2017 as CEO, and the company said it has “seen significant transformation and growth” during his tenure.

Adams’ MFuture program was successful in navigating the company through the pandemic so far, “and was a key driver of record company sales in FY21”.

The appointment of Jones follows a “well managed process, including a thorough global search instigated by the board”.

Jones is an experienced executive with extensive wholesale, retail, and eCommerce experience. Massmart group, a listed company on the Johannesburg Stock Exchange, has been Jones’ home for the past 14 years. It is majority-owned by Walmart.

The exchange of the old and the new will occur on 1 February 2022. The pair will work together to ensure a smooth transition.

Investors don’t appear to like the news, but they certainly don’t appear spooked by it either. The Metcash share price is currently trading 0.74% lower from the open at the time of writing.

Management commentary

Speaking of the CEO’s resignation, Metcash chair Rob Murray said:

The demands on Jeff through COVID have been considerable and were a factor in his decision to retire as Group CEO. His endurance and resilience during this period, which included not being able to see his US-based family, have been amazing. The board and our stakeholders greatly appreciate Jeff’s dedication and efforts, and we wish him all the best for his return to the US and his family.

Regarding the appointment of Doug Jones, and the value this can bring to Metcash, Murray added:

Doug’s extensive and distinguished international experience across wholesale, retail and eCommerce markets made him the standout candidate to succeed Jeff. He is passionate about the success of independent retailers and we are looking forward to him joining us and taking the company forward.

Metcash share price snapshot

The Metcash share price has gained 18% this year to date. It has also gained 39% over the past 12 months.

It is down around 1% this past month. However, it’s still well ahead of the S&P/ASX 200 index (ASX: XJO)’s return of about 20% in the last year.

The post Metcash (ASX:MTS) share price struggles as CEO steps down appeared first on The Motley Fool Australia.

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The author Zach Bristow has no positions 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 Bruce Jackson.

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ASX 200 shares in the insurance sector have performed strongly this week despite rising yields and inflation concerns weighing on broader equity markets.

The QBE Insurance Group Ltd (ASX: QBE) share price is up 6.35% this week to $12.23. Insurance Australia Group Ltd (ASX: IAG) is not far behind, with the IAG share price rallying 4.75% to $5.19.

Why are these ASX 200 shares outperforming?

Insurance is often viewed as a defensive industry that remains stable during fluctuations in the broader economy.

Insurers hold a lot of fixed-income assets, such as short-term money, government bonds, corporate bonds and infrastructure debt, to back the insurance policies they write.

In an era where global interest rates are at or close to zero, these underlying bond investments are yielding weak returns.

But the circumstances could soon change for these ASX 200 shares given the concerns about rising inflation.

The US Federal Reserve initially flagged higher inflation as ‘transitory’ as the global economy cycles through elevated prices from 2020. However, surging energy prices and supply bottlenecks have continued to place upward pressure on inflation.

A number of Federal Reserve officials have already expressed their expectations of an increase in interest rates in 2022.

Benchmark US 10-year treasury yields are pushing higher this week, reflecting the inflation and tighter monetary policy concerns. The 10-year rate is currently fetching 1.59%, the highest since early June.

Closer to home, the Reserve Bank of New Zealand raised its official cash rate by 25 basis points to 0.5% this week. This is its first rate hike since June 2014. Policymakers say this decision is appropriate to keep inflation at bay and ease the hot property market.

ASX 200 shares in the insurance sector have held up well this week despite the whipsaw-like action from the S&P/ASX 200 Index (ASX: XJO).

Looking at the bigger picture, both QBE and Insurance Australia are both trading well below pre-COVID levels.

The post 2 ASX 200 shares surging this week despite inflation worries appeared first on The Motley Fool Australia.

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• ASX 200 (ASX:XJO) midday update: EML crashes, mining shares rise
• What happened on the US stock market last night?
• October is ‘crash’ month: Will history repeat for the ASX 200?
• CBA (ASX:CBA) warns iron ore price will fall by 27% in the next year

Motley Fool contributor Kerry Sun 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 owns shares of and has recommended Insurance Australia Group Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The Commonwealth Bank of Australia (ASX: CBA) share price is on course to end the week on a subdued note.

At the time of writing, the CBA share price is down almost 0.5% to $103.00. Though, positively, that doesn’t take much of the shine off its stunning performance this year.

Since the start of 2021, the CBA share price is up a sizeable 23%. That’s more than two and half times the return of the S&P/ASX 200 Index (ASX: XJO).

Can the CBA share price keep rising and hit $120 by the end of 2021?

The good news is that one leading broker believes the CBA share price still has room to run higher.

According to a recent note out of Bell Potter, its analysts have a buy rating and $118.00 price target on its shares.

Based on the current CBA share price, this implies potential upside of 14.5% over the next 12 months before dividends.

Bell Potter is also forecasting a $4.06 per share fully franked dividend in FY 2022. If we add this into the equation, the potential total return stretches to over 18%.

Based on this, the broker clearly believes there’s a chance that CBA shares could be trading close to $120 come the end of the year.

What did it say?

Bell Potter is positive on the CBA share price due to its belief that Australia’s largest bank will come out of the pandemic in a strong position.

It commented: “Like it or not, COVID-19 is seen as a good thing for CBA. The bank has now bounced back from its lows and is on its way back to its usual top line growth potential. Combined with effective cost management, strong prudential measures and IT leadership, CBA should be able to ride out the COVID-19 storm and emerge fundamentally stronger once the pandemic has ended and when interest rates begin to rise once again.”

And while the broker likes Australia and New Zealand Banking GrpLtd (ASX: ANZ) and National Australia Bank Ltd (ASX: NAB) as well, it notes that Commonwealth Bank is its top pick among the major banks.

It explained: “We continue to prefer CBA (Buy) and ANZ (Buy) (the former based on future performance potential and the latter purely on pricing), the pecking order is now shifted as follows: (1) CBA; (2) NAB; and (3) ANZ.”

The post Could the CBA (ASX:CBA) share price hit $120 by the end of 2021? appeared first on The Motley Fool Australia.

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• CBA (ASX:CBA) share price slides as bank is awarded for rapid cloud migration
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• Travel stocks soar. Hopes for a new COVID treatment. Evergrande drags on. Scott Phillips on Nine’s Late News

Motley Fool contributor James Mickleboro 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 Bruce Jackson.

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The Korvest Limited (ASX: KOV) share price is surging today following a positive trading update from the Australian-based manufacturing company.

At the time of writing, the Korvest share price is up 8.93% to $6.10. Earlier on Friday, the share price rose as high as $6.35, which was 13.4% above yesterday’s closing price.

What did Korvest announce to the ASX?

In its release, Korvest advised that unprecedented levels of large project work along with favourable market conditions has led to a strong start for FY22.

Korvest highlighted the company’s strong performance in their June 2021 annual report but gave no earnings guidance.

The pull forward of major project supply means that Korvest now expects first-half profit before tax will exceed $8 million.

The guidance includes the previously disclosed $0.5 million profit on sale of the Power Step and Titan Technologies.

By comparison, the company achieved a net profit after tax for the prior corresponding period of $2.835 million.

The accelerated delivery of significant project work is estimated to lead to an earlier than scheduled completion. Without winning new infrastructure contracts, the first-half performance is likely to taper off in the second half of FY22.

Korvest notes that the guidance assumes there is no adverse effect from COVID-19 on the construction industry.

While the current economic climate is unpredictable, Korvest is hopeful that major projects will continue to be supplied throughout FY22.

Quick take on Korvest

Founded in 1970, Korvest provides supplies cable and pipe supports, industrial access and safety systems, fastening solutions, and galvanising services.

Korvest is headquartered in South Australia but has sales offices across Australia and in New Zealand.

Korvest share price snapshot

Over the past 12 months, Korvest shares have travelled almost 40% higher, with the year-to-date up about 20%. The Korvest share price today is sitting towards the upper end of its 52-week range of $3.91 to $6.65.

Based on today’s share price, Korvest presides a market capitalisation of roughly $69.88 million. Korvest has approximately 11.45 million shares outstanding.

The post Why did the Korvest (ASX:KOV) share price jump 13% on Friday? appeared first on The Motley Fool Australia.

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• ASX 200 up but energy down, and economic upside as NSW opens. Scott Phillips on Nine’s Late News
• Here’s why the Hannans (ASX:HNR) share price is rocketing 30% today
• Is the Fortescue (ASX:FMG) dividend yield really 25%?
• US warns Evergrande crisis could affect ‘entire world’
• ASX 200 (ASX:XJO) midday update: EML crashes, mining shares rise

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 Bruce Jackson.

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Motley Fool Australia Chief Investment Officer Scott Phillips joined Nine’s Late News on Thursday night to discuss the day on the ASX, including most sectors up, while the oil price weighed on energy. Plus, the impact of NSW reopening and a welcome fall in credit card debt.

The post ASX 200 up but energy down, and economic upside as NSW opens. Scott Phillips on Nine’s Late News appeared first on The Motley Fool Australia.

More reading

• Why did the Korvest (ASX:KOV) share price jump 13% on Friday?
• Here’s why the Hannans (ASX:HNR) share price is rocketing 30% today
• Is the Fortescue (ASX:FMG) dividend yield really 25%?
• US warns Evergrande crisis could affect ‘entire world’
• ASX 200 (ASX:XJO) midday update: EML crashes, mining shares rise

Motley Fool contributor Scott Phillips 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 Bruce Jackson.

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The Hannans Ltd (ASX: HNR) share price is surging on the back of an update to the company’s plan to recover battery metals from spent lithium-ion batteries.

The company has previously signed a memorandum of understanding with Critical Metals‘ subsidiary, LiB Recycling.

Under the agreement, the pair will plan to form a joint venture to commercialise lithium-ion battery recycling technology in Europe’s Nordic region.

Today, Hannans announced that the understanding’s first precedent has been fulfilled, with Critical Metals’ shareholders voting in favour of the partnership.

At the time of writing, the Hannans share price is 3 cents, 30.34% higher than its previous close.

Let’s take a closer look at today’s announcement from the battery metal exploration company-turned-battery recycler.

One step closer to battery recycling

The Hannans share price is surging on the back of news of its plan to retrieve battery metals by recycling lithium-ion batteries.

The company is hoping to enter into a joint venture with LiB Recycling to commercialise a battery recycling project in Norway, Sweden, Denmark, and Finland.

The memorandum of understanding between Hannans and LiB Recycling – the first step towards a joint venture – has passed its first hurdle.

There are now only 2 conditions on which the agreement is balancing on. Hannans believes the last conditions will be satisfied by 30 November.

LiB Recycling has exclusive rights to commercialise Neometals Ltd‘s (ASX: NMT) technology in the Nordic region. Neometals’ technology can recover battery metals from spent lithium-ion batteries.

Under the joint venture, Hannans will earn its interest by funding and managing certain tasks and activities. These include funding the battery recycling project through to a final investment decision.

According to Hannans, the lithium-ion battery recycling technology has gone through pilot plant and validation test work programs, leaving it substantially derisked.

The company also states the Nordic region has the highest electric vehicle penetration rates in the world.

Additionally, Europe doesn’t produce enough metals to meet its massive growth in the uptake of batteries.

Lastly, European battery and electric vehicle manufacturers must reuse metals to meet legal, social, and environmental obligations.

Hannans share price snapshot

2021 has been a big year for the Hannans share price.

Right now, it is 500% higher than it was at the start of this year. It has also gained 400% since this time last year.

The post Here’s why the Hannans (ASX:HNR) share price is rocketing 30% today appeared first on The Motley Fool Australia.

More reading

• Why did the Korvest (ASX:KOV) share price jump 13% on Friday?
• ASX 200 up but energy down, and economic upside as NSW opens. Scott Phillips on Nine’s Late News
• Is the Fortescue (ASX:FMG) dividend yield really 25%?
• US warns Evergrande crisis could affect ‘entire world’
• ASX 200 (ASX:XJO) midday update: EML crashes, mining shares rise

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 Bruce Jackson.

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The Fortescue Metals Group Limited (ASX: FMG) dividend was among the most generous on the Australian share market in FY 2021.

Thanks to sky high iron ore prices, the mining giant was generating significant free cash flow and returned the majority of it to shareholders.

So much so, if you were to look on financial websites such as Google Finance, you will see that the Fortescue dividend yield shows up as 25%.

To put that into context, this means that a $10,000 investment would give you a $2,500 dividend.

Is the Fortescue dividend yield really 25%?

The answer to this question depends upon what you class as the Fortescue dividend.

For example, in FY 2021 Fortescue paid out fully franked dividends totalling $3.58 per share. Based on the current Fortescue share price of $14.23, that indeed equates to a 25% dividend yield.

However, that is on a trailing twelve months (ttm) basis. This dividend has been and gone, so has become largely irrelevant.

What’s the real yield?

The dividend of most significance is the one the miner pays over the 12 months.

And as you might have guessed from the very sharp and recent pullback in the Fortescue share price (and iron ore price), that dividend is not expected to be anywhere near as large as the one paid in FY 2021.

For example, a note out of Goldman Sachs this week reveals that its analysts are expecting a fully franked US$1.02 per share dividend from the mining giant in FY 2022. After which, the broker has forecast a dividend of just 61 US cents per share in FY 2023.

Based on the current Fortescue share price and exchange rates, this will mean yields of 9.7% and 5.8%, respectively, over the next two financial years. While these are still great yields in a low interest rate environment, anyone buying shares recently hoping to receive a 25% yield will be thoroughly disappointed.

So, to circle back to the original question, is the Fortescue dividend yield really 25%? The answer is, sadly no.

The post Is the Fortescue (ASX:FMG) dividend yield really 25%? appeared first on The Motley Fool Australia.

More reading

• US warns Evergrande crisis could affect ‘entire world’
• CBA (ASX:CBA) warns iron ore price will fall by 27% in the next year
• Could the Fortescue (ASX:FMG) share price slide to $12.50 by Christmas?
• Leading brokers name 3 ASX shares to sell today
• Broker warns Fortescue (ASX:FMG) share price could sink a further 20%

Motley Fool contributor James Mickleboro 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 Bruce Jackson.

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The giant real estate developer Evergrande Group could impact the entire world, according to the US.

These comments came from the US Secretary of State, Antony Blinken, when he was talking about the ongoing crisis with the Chinese property giant.

News.com.au reported that Mr Blinken spoke to Bloomberg Television and said:

China has to make sovereign economic decisions for itself, but we also know that what China does economically is going to have profound ramifications, profound effects, on literally the entire world because all of our economies are so intertwined.

So certainly when it comes to something that could have a major impact on the Chinese economy we look to China to act responsibly and to deal effectively with any challenges.

What’s happening with Evergrande’s debt?

Evergrande has a huge pile of debt, reportedly more than A$400 billion.

Various media, such as Nikkei, have reported that Evergrande has missed a second bond payment in two weeks. It was reportedly meant to pay $46 million to investors, but those investors said that they didn’t receive the payment that was due.

Both investors reportedly said that they and other bondholders have started working with advisers to form a committee that would be able to jointly press their claims with the company.

There are reportedly $7.7 billion of Evergrande bonds that are maturing next year.

Not only that, but two Hong Kong property agencies are looking to sue the company regarding unpaid commissions, according to Reuters, to the tune of around $8 million.

Another Chinese real estate developer, called Fantasia, also didn’t make a US$206 million bond payment. Could that mean there’s more trouble ahead?

How is this impacting ASX 200 shares?

China is Australia’s largest economic trading partner, so there may be some indirect effects on the S&P/ASX 200 Index (ASX: XJO) if there were to be the problems that Mr Blinken could be foreshadowing.

Analysts have been considering the impact of a Evergrande failure on ASX 200 iron shares. Businesses like Fortescue Metals Group Limited (ASX: FMG), BHP Group Ltd (ASX: BHP) and Rio Tinto Limited (ASX: RIO) may have a closer connection to Evergrande than the ASX 200 as a whole. Evergrande happens to be one of the biggest individual users of steel (and therefore iron) in the world.

Some share prices of iron ore miners have fallen quite a bit in recent months. For example, the Rio Tinto share price has dropped by 23% in just two months.

Despite that fall, the broker UBS still thinks that Rio Tinto is a sell with a price target of $86. The rapid fall in the iron ore price makes the broker think that Rio Tinto’s profit in FY22 will be materially impacted. It also believes that non-Australian iron ore supply is going to increase in the coming years, with more steel scrap in China as well.

Time will tell what happens with the Evergrande Group crisis. It is interesting the US Secretary of State decided to make a comment about what’s going on.

The post US warns Evergrande crisis could affect ‘entire world’ appeared first on The Motley Fool Australia.

More reading

• ASX 200 (ASX:XJO) midday update: EML crashes, mining shares rise
• BHP (ASX: BHP) share price gains amid CEO’s ‘strong growth outlook for China’
• What happened on the US stock market last night?
• October is ‘crash’ month: Will history repeat for the ASX 200?
• CBA (ASX:CBA) warns iron ore price will fall by 27% in the next year

Motley Fool contributor Tristan Harrison owns shares of Fortescue Metals Group Limited. 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 Bruce Jackson.

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