Spdr S&P Metals & Mining
Spdr S&P Metals & Mining
XME
$ 1.85
4.94%
74%
IBD stock analysis
- Back above 38.09 buy point after main support test
- Relative strength line near high
- Avoids specific risk to the company, but remains volatile
Business Group Rating
Emerging pattern
Cupa
* Not real time data. All data shown were captured at 1:07 PM EDT on 03/26/2021.
The IBD day stock is the SPDR S&P Metals & Mining ETF (XME), a trading fund that oversees a series of U.S. mining stocks and metals stocks. The ETF is in buying range and was added to SwingTrader on Friday.
X.
The benefits for the ETF and other mining stocks come with a broader economic reversal from the coronavirus pandemic. As the economy reopens, some investors are promising demand for metal products, and demand for more such materials to be mined from the ground, will recover.
“Commodity markets have strengthened as demand forecasts have improved and supply constraints have increased,” mining stock analysts told Jefferies in a research note last month.
XME sets, as mining stocks move higher
The SPDR S&P Metals & Mining ETF rose 5% to 39.34 in the stock market today. The stock is back above its 38.09 cup base entry in addition to its 21-day abstract moving average. The XME ETF started out at the end of February, but returned abruptly before running again to 41.98 on March 18th. Shares fell again, going below the 50-day line on Thursday before closing higher.
The ETF’s relative strength line, which compares to its performance and the S&P 500, has moved higher since November. Investing in an ETF is a way to play an entire business, counteracting some of the volatility and risk that comes with investing in individual companies. But there is no question that XME is volatile.
Mining stocks as Alcoa (AA), Coeur Mining (CDE) and Freeport-McMoRan (FCX) is among the assets of the fund. Other stocks in the ETF include US steel (X), Dynamics of steel (STLD) and Royal Gold (RGLD).
Commodity prices for things like iron ore and nickel were standing at multi-year highs earlier this year, an IBD story from January noted. Demand from China, government stimulus efforts and a weak dollar have helped lift these prices.
Rising prospects on infrastructure plans
Mining stocks have also been driven by expectations for increased U.S. infrastructure consumption – increasing demand for steel and the iron ore used to produce it – as well as potential for further trade tensions between the USA and China. Copper is a vital industrial metal. It is also widely used in electric vehicles and solar power.
Supply has been tight as demand for steel in the US – for things like cars – has accelerated. The pandemic, and the 2019 catastrophe at the Vale mine in Brazil, have raised concerns about the ability to mine materials safely at all.
Other mining stocks include Vale (VALE), Stock of the Day recently rose 1.4%. BHP Billiton (BHP) received 3.2%.
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