Why are these ASX mining stocks in limelight today?


Today the Australian share market opened higher as the benchmark index was up 0.012% at 7146.500 points at 12:55 PM AEST. Out of 11 sectors, t wo sectors – Materials and Energy – traded higher, while the remaining nine traded in the red zone in the intraday trading session today. 

The S&P/ASX 200 Materials Index (ASX:XMJ) was 1.109% higher at 17478.400 points at 12:56 PM AEST, while the S&P/ASX 200 Energy Sector (ASX:XEJ) was up 0.591% at 9944.300 points at 12:59 PM AEST. 

The gains made by the materials sector were on account of higher iron ore prices due to the additional policy support from China. Meanwhile, investors are optimistic that lockdown restrictions will soon be lifted in China. The the rise in oil prices has contributed to the energy sector’s positive performance today. The weakened US dollar, tight supply, and Shanghai’s COVID unlock have pushed the oil prices higher. 

Recently, China unveiled its plan to cut borrowing rates on iron ore. Let us look at four ASX-listed iron ore mining companies and their recent performance in the Australian share market. These four stocks include BHP Group Limited (ASX:BHP), Rio Tinto (ASX:RIO), Fortescue Metals Group Limited (ASX:FMG), and South32 Ltd (ASX:S32). 

BHP Group Limited (ASX:BHP)

The shares of the world’s leading iron ore and copper mining company BHP Group Limited traded 1.197% higher at AU$47.745 per share on ASX at 1:51 PM AEST today. 

Last week, the Group announced its plan to pay BHP shareholders an in specie dividend in the form of Woodside Petroleum Ltd shares in connection with the merger of BHP’s oil and gas portfolio with Woodside (Merger). The in specie dividend is likely to be paid on 1 June and will be fully franked. It is to be noted that Woodside shareholders have approved the merger of BHP’s oil and gas portfolio with Woodside by an all-stock merger (Merger). In the last one year, BHP shares have risen 1.87%, while the stock is up 12.66% year-to-date (YTD). 

 

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Rio Tinto (ASX:RIO)

The shares of iron-ore mining giant Rio Tinto were up 1.356% at AU$109.820 per share on ASX during the intraday trading session on Monday (23 May 2022). 

Recently, the miner had agreed to amend the previously agreed funding plan with Turquoise Hill Resources (TRQ) to provide liquidity of roughly $400 million in short-term early advances. This is when the Special Committee of TRQ evaluates Rio Tinto’s C$34 per share all-cash proposal to acquire approximately 49% of the issued and outstanding shares of TRQ that Rio does not currently own.

In the last 12-months, Rio Tinto shares have fallen 8.10%, while the stock is up 10.16% YTD. 

Fortescue Metals Group Limited (ASX:FMG)

Fortescue Metals Group shares traded 2.183% higher at AU$20.590 per share on ASX at 2:32 PM AEST. The company’s shares were in focus recently after the Group announced that Dr Andrew Forrest AO would be appointed as Executive Chairman of the Fortescue Group. The ASX-listed iron ore company has a market capitalisation of AU$62.04 billion. In the last 12 months, the share price of Fortescue Metals Group Limited has fallen 3.70%, while the stock is up 3.68% YTD. 

South32 Ltd (ASX:S32)

The shares of ASX-listed diversified mining and metals company South32 Ltd traded 0.423% lower at AU$4.700 per share on ASX at 2:45 PM AEST today. In a business update announced last week, the company reported an ROIC of 25% in H1 FY22. The company claims to distribute a minimum of 40% of Underlying earnings as ordinary dividends.

South32 Ltd has a market capitalisation of AU$21.92 billion. In the last one year, South32 shares have risen 66.67%, while the stock is up 15.48% YTD. 

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