The copper stocks continue lag behind the industrial metal after surging to new highs in January when speculative euphoria spilled over from precious metals into copper. Within the ETF there has been some very differing performances which is common place with miners which can drop the ball operationally: Osisko Metals (+133%), Faraday Copper (+109%), Amerigo Resources (+90%), and BHP (+41%) carrying the bulk of the upside, while the Chinese miners and Ivanhoe Mines have been notable laggards despite copper trading near all-time highs.
The WIRE ETF is another reminder that when the crowd chases one theme without care, risk alarm bells should ring. We note that while we like the WIRE ETF, we are more confident in our call of copper hitting US7.00 than the ETF hitting $30.
- We continue to target new highs for copper over the next 6-months which could see the WIRE ETF test ~$30, or 20% higher.
MM is bullish towards the WIRE ETF around $24.50
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