Resources to benefit from Trump victory

Resources to benefit from Trump victory

Donald Trump’s victory at the polls last week could support resource prices, particularly metals, according to Terra Capital.


In a note to investors, Terra Capital portfolio manager Matthew Langsford said commodities were set to benefit from a Trump presidency, noting that base metals such as copper, nickel, aluminium and lead had already posted visible gains.

Mr Langsford pointed out that copper reached a 15 month high following the result of the election.

“The repercussions of the US election result are supportive of an improving demand outlook for commodities given infrastructure spending, potential tax cuts, rising inflation etc,” said Mr Langsford.

“While the exact pathway to resources return to favour is unclear, our view is that the upwelling in some commodities was a relief rally and that is likely to continue and broaden into a wider recovery for commodities generally.”

Industrial metals had a “relatively weak month”, Mr Langsford said, though iron ore ended the month on a high of $63.10 per tonne, and both coking and thermal coal saw increases of $75 and $40 respectively.

“Gold was weaker on the back of a broadly stronger US dollar with spot falling 4 per cent to US$1,272 per ounce,” Mr Langsford said.

“Gold traded-up sharply on Wednesday – pre-election result – trading above US$1,330 per ounce before giving up most of its gains, as a victory speech from US President-elect Donald Trump helped the dollar rebound.”

Read more:

Demand for annuities up 30%, says CFS

'Lifestyle risk' biggest threat for super members

Bond super cycle 'likely over': AMP Capital

Fund manager capacity no predictor of returns

Board directors getting older: ACSI

 

Resources to benefit from Trump victory
investordaily image
ID logo
promoted stories

Appointments

investordaily image

AMP names incoming chief risk officer

Jessica Yun

investordaily image

Antares Equities hires new director

Staff Reporter

Brad Fox

Former AFA CEO appointed to boutique board

Staff Reporter

Analysis

investordaily image

Warning lights flashing on Aussie equities

Roy Maslen

investordaily image

What’s in store for the economy in 2018?

Frank Uhlenbruch

ST Wong

Busting common passive investing myths

ST Wong