Almost all eyes will be on outlook when BHP Group Ltd (LSE:BHP, ASX:BHP) updates the market on Tuesday.
The mining sector is pinched between the rock of slowing Chinese demand and the hard place of high fuel and input costs, all of which adds up to a squeeze on margins and profitability.
Investors will want to see a clean bill of health on the current production performance.
Analysts at Jefferies expect volatility will remain in the sector for some time, but, in a note last month upgraded its targets for BHP – to 3,100p from 2,500p.
Looking across the sector, the Jefferies mining team said: While iron ore shipments fell in the first quarter of 2022, with little organic growth, an uptick in Chinese demand could lead to a further lift in prices, Jefferies said.
Copper mining production also dropped in the first quarter and total volumes are expected to be low for the rest of the year. Its coal price forecast is based on a "lack of supply growth" as many companies are winding down coal activities.
Commodity prices, it expects, will be “rising to new highs”, although the pace of recovery could take a decade to be realised.
Tuesday 19 July
Trading updates: Begbies Traynor (AIM:BEG) PLC, BHP Group Ltd (LSE:BHP, ASX:BHP), City of London Investment Group (AIM:CLIG) PLC, Integrafin Holdings PLC, Kier Group PLC (LSE:KIE), Luceco PLC (LSE:LUCE), Victoria PLC (AIM:VCP), Wise PLC (LSE:WISE), Yellow Cake
Interims: Photo-Me International PLC (AIM:PHTM)
AGMs: Arrow Exploration Corp (TSX-V:AXL, AIM:AXL, OTC:CSTPF), Begbies Traynor, Clean Power Hydrogen PLC (AIM:CPH2), e-Therapeutics PLC, HICL Infrastructure PLC, Norcros PLC (LSE:NXR), TPXImpact Holdings PLC, Wynnstay Property PLC
Economic announcements: Unemployment report, Building Permits, Housing Starts