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Tim Lambert
China-Russia Deal has Natural Resources Sector Rising
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It is not just energy stocks that are doing well from the Russia-China gas deal, but the entire natural resources sector ranging from blue chips like Rio Tinto (NYSE: RIO) to promising small caps like Premium Exploration (OTC: PMMEF).

A previous article on this site, “Putin’s Deal Show Value of Energy Stocks,”  reported on how oil and natural gas firms in size from ExxonMobil (NYSE: XOM) to Mondial Ventures (OTC: MNVN) were up on the $400 bill natural gas deal between China and Russia.  The market reacted this way due to a couple of factors.  Supply and demand was one.  A deal of this magnitude is naturally going to apply pressure on the market.  The market has bought into energy stocks as oil is now a safe haven asset.

It is becoming that way with natural resource stocks, too.

Gold companies like Premium Exploration and Barrick Gold (NYSE: ABX) have always been traditional safe harbor assets.  That is especially so for those with valuable holdings in the United States like those for Premium Exploration in Idaho.  Due to the tension around the world, SPDR Gold Shares (NYSE: GLD), the exchange traded fund for gold, is up more than 7 percent for 2014.

Rio Tinto, the biggest iron ore entity in the world, is trading higher by nearly 24 percent for the last year of market action (chart below).

It is becoming obvious that natural resource stocks like Rio Tinto and Premium Exploration now have more value as safe haven assets.  Along with the rising demand for commodities around the world, that makes these stocks very appealing looking for growth, too.  Gains from the Russia-China headl have not been limited solely to the energy sector.  While oil and natural gas stocks have done well, investors are into firms that benefit from commodity gains in a wide range of sectors.






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