Which stocks are benefiting most from the commodity price high?
As the price of iron ore reaches a six-month high, how are Aussie commodities stocks performing and which funds could benefit?
Yesterday, VanEck portfolio manager, Cameron McCormack, said prices for iron ore had reached a six-month high helped by growing hopes of improved demand in China. These higher prices, which also applied to liquefied natural gas (LNG), would likely equate to stronger earnings for resources companies.
The biggest iron ore exporters in Australia were BHP, Rio Tinto and Fortescue while major LNG companies included Woodside, Origin Energy and Santos.
Since the start of the year, which included the start of the war between Russia and Ukraine, the best-performing iron ore stock was 20.2% followed by Rio Tinto which had risen 18%.
However, Fortescue Metals had reported losses of 0.6% over the same period as the firm reported a 28% decline in earnings before interest, tax, depreciation and amortisation and a 32% reduction in underlying net profit.
In the LNG space, Woodside Petroleum had been a stand-out performer with returns of more than 50% since the start of the year. Meanwhile, Santos had returned 22% and Origin Energy had returned 14.5%.
This compared to losses of 3.7% by the ASX 200 over the same period.
Performance of iron ore and LNG stocks since start of the year to 11 March
Within the Australian Core Strategies universe, the Commodity and Energy sector had returned 15.4% over one year to 28 February.
The best-performing fund was the BetaShares Crude Oil Index ETF which had returned 65% followed by BetaShares Global Energy Companies ETF which had returned 37%.
Since the start of the year to 28 February, 2022, these two funds were still the two best-performing funds with returns of 86% and 48% respectively.
AUTHOR
Laura Dew
Recommended for you
Selfwealth has provided an update on the status of its scheme implementation deed with Bell Financial Group as well as whether rival bidder Svava remains in the picture.
Magellan Financial Group has reported its first half FY25 results while appointing a new chief financial officer and promoting Sophia Rahmani to chief executive.
Schroders Australia has launched two active ETFs and plans to further expand its listed range over the year ahead.
Platform Netwealth has reported its financial results for the first half of FY25, reporting an 80 per cent increase in net flows, with its CEO viewing a “huge opportunity” from private assets.
