Copper hit $US10,000 a tonne for the first time since 2022 as traders took BHP’s takeover bid for Anglo American as a vote of confidence for the metal.
Already a subscriber?Copper prices surged to $US10,000 a tonne for the first time in two years after BHP’s blockbuster bid on resources heavyweight Anglo American sparked renewed confidence in the metal, adding fresh thrust to the wave of M&A sweeping across commodity markets., which Anglo American knocked back on Friday, followed a more than 15 per cent surge in copper prices this year. Futures rose as much as 1.
“BHP’s not making a $60 billion bid purely for copper if they don’t think the returns in copper will be as good, if not better, than iron ore for the next 10 years,” said Ben Cleary, portfolio manager of Tribeca’s Global Natural Resources fund.Investors have been waiting years for the copper price to break out of the narrow $US8000 to $US9000 a tonne range it has been stuck in, which has kept a lid on the valuations of miners of the metal.
“The deal just has great look-through for the whole copper sector and will be a catalyst for equities to keep moving higher,” he said. And fund managers are betting that the wave of M&A deals that flooded through the gold sector, headlined by“BHP’s offer brings a sense of urgency to the entire sector that the M&A cycle is starting to kick off and companies who think they have an indefinite amount of time before they move on a neighbour run the risk of leaving things too late,” said Sam Berridge, portfolio manager of Perennial’s natural resources fund.
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