CIA rallied +4.4% on Wednesday, helped by Dalian iron ore futures hitting a five-week high, buoyed by China’s additional measures to spur economic growth. The stock has been trading around $6.40 for seven weeks, and although we ultimately believe it will go higher, it’s not our pick for exposure to the bulk commodity – FMG is forecast to yield more than double CIA over the next 12-months which is an initial reason to prefer Twiggy’s company if any advance proves a slow process.
- We remain bullish towards iron ore but prefer Fortescue (FMG) for outright exposure and BHP &/or Mineral Resources (MIN) for diversification.
MM is neutral to bullish CIA
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