The S&P Materials sector closed this trading week in green with 1% gain, while Materials Select Sector SPDR (NYSEARCA:XLB) also registered nearly 1% growth for the five-day period.
Silver (XAGUSD:CUR) fell to a 1-month trading low at the start of the week, dropping by 3% to touch $22.74/oz on Monday. Prices settled at $23.59/oz by Friday, ending the week with a 1.65% decline. Despite the recent drop, analysts say the price of silver could hit $30/oz this year, driven by supply shortages of the metal.
Gold (XAUUSD:CUR) prices pulled back from a nine-month high on Tuesday, as per CNBC, due to a slight growth in the dollar and U.S. bond yields. The yellow metal settled at $1,927.75/oz by Friday, registering a 0.09% gain for the week.
Copper (HG1:COM) prices were nearly flat on Friday as a week-long holiday in China paused a rally which was driven by hopes that economic activities would pick up after the country withdrew its strict COVID curbs. LME 3-month copper were almost unchanged at $9,330/ton by 0427 GMT, as per Reuters, and rose only 0.1% on a weekly basis.
LME aluminum (LMAHDS03:COM) eased 0.2% to $2,634.50/ton, while tin prices grew 0.4% to $32,400/ton. LME tin prices have advanced 31% so far in January and is set for a record monthly gain.
Lumber futures (LB1:COM) grew 13% on Friday, reaching $524 per thousand board feet – its highest level since mid-October. The commodity has picked up pace since the promising housing market report, and is up over 32% YTD.
Take a look at this week’s top gainers and losers among basic material stocks ($2B market cap or more):
West Fraser Timber (WFG) +15.47%; The lumber firm was upgraded to Outperform from Neutral at CIBC on expectations that moderating mortgage rates should lift homebuilding in the U.S. The higher ratings come “with housing affordability improving and a significant removal of B.C. lumber industry capacity from Canfor,” CIBC analyst Hamir Patel wrote.
Albemarle (ALB) +12.91%; The specialty chemicals firm released its prelim results this week, guiding Q4 earnings above Wall Street estimates. Deutsche Bank recently said that a strong long-term outlook from Albemarle (ALB) would help boost shares, calling the stock a “catalyst buy.”
Olin (OLN) +10.93%; Shares surged after the chemical products maker reported better-than-expected earnings for fourth quarter. Full year 2023 adjusted EBITDA is expected to be in the $1.5B to $2B range.
James Hardie Industries (JHX) +9.19%
Steel Dynamics (STLD) +9.05%; Shares surged after Q4 profits exceeded estimates, while the company said customer order entry activity remains healthy, steel pricing has firmed, and it believes North American steel consumption will increase in 2023.
The week’s top decliners were ($2B market cap or more):
Sherwin-Williams (SHW) -6.74%; Shares dropped after the company’s recent quarterly update included a weak forecast for 2023.
Rounding out the list were mining firms, especially gold miners: AngloGold Ashanti (AU) -5.83%, Harmony Gold Mining (HMY) -5.28%, Sibanye Stillwater (SBSW) -5.11%, NovaGold Resources (NG) -5.11%
Other materials ETFs to watch: iShares Global Timber & Forestry ETF (WOOD), Materials Select Sector SPDR ETF, Vanguard Materials ETF (NYSEARCA:VAW), iShares Global Materials ETF (NYSEARCA:MXI), SPDR S&P Metals and Mining ETF (NYSEARCA:XME), VanEck Vectors Gold Miners ETF (NYSEARCA:GDX), iShares MSCI Global Gold Miners ETF (RING), Global X Copper Miners ETF (NYSEARCA:COPX).
