Commodity equities have hit bottom, claim JPM and Steel

Two natural resources managers have said commodity-related equities have now reached a floor following several months of falls.

Trevor Steel (pictured, left), of the £20m Baker Steel trust, and James Sutton, of J. P. Morgan Asset Management's Natural Resources team, both believe that commodity and resource equity prices have hit their floor. Steel said a marked decline in capex in the mining sector means that the supply curve in that area has dramatically transformed since stocks fell into decline in 2011. He said" "The cyclicality of mining is characterised by overinvestment and oversupply, followed by falling prices which prompt cutbacks that cause a lack of supply. "It is a natural end point and we have ...