The fun is over in the copper market according to HSBC, which has stuck 'reduce' ratings on KAZ Minerals PLC (LON:KAZ) and Antofagasta PLC (LON:ANTO).
After its 19% spike over the past month, HSBC expects the copper price to be range bound for next 2-3 years with the current small surplus likely to remain as further supply continues to enter a low
If China demand is better than expected or Donald Trump really does throw money at US infrastructure, that view might change but there is little visibility on whether these are likely to materialise to gauge the impact on fundamentals.
KAZ Minerals has good assets but is financially stretched and HSBC has a target price of 100p. Antofagasta (LON:ANTO) is almost the polar opposite, with a well-established higher cost production profile but it still gets a reduce rating with a target price of 470p.