SOURCE: Rothman Research

Rothman Research

July 13, 2010 09:02 ET

Metal Stocks Battered in Red

JOHANNESBURG, SOUTH AFRICA--(Marketwire - July 13, 2010) - provides an overview on the current conditions influencing the price of base metals and its impact on metal stocks. Sign up now to access those reports.

China's economic growth has been a major driver of the global economic progression. However, there is clearly a sense of growing uncertainty brewing in the metal industry worldwide with the China factor continuing to play a pivotal role in the wrong direction. So far, the political signs in China indicate that the government is working around the clock to control the housing sector's bubble which many believe is on the verge of bursting. And when this occurs demand for metal is anticipated to slump abruptly and this would be grievous for metal miners like Latin American based Vale S.A. (NYSE: VALE) which have been trading in the red in its last session. provides technical analysis and free downloadable research reports on Vale S.A. by signing up now at is a source for investors seeking free information on Steel & Iron Stocks; investors and shareholders of Steel Dynamics Inc., Vale S.A., Schnitzer Steel Industries Inc. and Nucor Corporation are encouraged to sign up for free at

During the recession most countries globally were forced to curb their demand for metal with the exception of China which saw its housing, manufacturing and auto industries' expansion propel demand for metal to new levels. However, it would seem that the run hit a wall for miners which are now looking at a decline in the price of metal as Chinese demand for base metal is in freefall mode. The fall in steel prices is more apparent when considering the drop in the Baltic Dry Index (BDI). The BDI saw its 32nd consecutive day of decline on Monday which makes this the greatest uninterrupted fall in close to nine years.

From the policies being drawn by the Chinese government, the resolution to abolish export rebates on steel has been highly welcomed by European and U.S. steel makers. Some companies like Nucor and Steel Dynamics are expected to benefit from this new policy which will take effect on July 15th 2010. Complimentary reports on Steel Dynamics Inc. can be accessed at

The Australian Stock Market which is among the first to open was already trading in negative territories as weak points among mining and gold stocks continue to hurt investor sentiment. It remains to be seen if this trend will repeat itself on the American exchanges today.

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