Base metals continued to make record gains as the Russia-Ukraine crisis escalates. Comex copper futures (HG1:COM) settled at a record high $4.938/lb on Mar. 04, capping a 10%-plus gain since Russia launched its invasion of Ukraine more than a week ago.
April Comex gold (XAUUSD:CUR) also touched at $1,969.45/oz, following similar gains over the previous week and marking its largest weekly rise since May 2021. Gold futures traded higher as Russia's attack on the Ukrainian nuclear plant, which caused a fire and fears of a potential Chernobyl-style disaster, raises concern that the invasion is taking a more perilous turn.
Western sanctions have not yet singled out the Russian aluminum industry, which is one of the world's largest suppliers of the metal, for fear of disrupting already short global supplies. Yet aluminum has been hitting record highs too. On the London Metal Exchange, aluminum (LMAHDS03:COM) hit a fresh record high $3,699/metric ton in early trading this week.
Aluminum producer Alcoa (NYSE:AA) shares were also hitting new all-time highs on a near-daily basis, as aluminum prices have jumped 37% since mid-December, shattering records along the way. The company says it will stop selling products to Russian companies and stop buying raw materials from the country in response to the invasion of Ukraine.
Alcoa CFO William Oplinger does not expect the Russian invasion to have a direct impact on the company, but expects it will result in sustained higher aluminum prices and tighter alumina supply.
The week's top five gainers among Basic Materials stocks ($300M market cap or more) were:
- Intrepid Potash (NYSE:IPI) +34.09% and Ramaco Resources (NASDAQ:METC) +30.20%; Both companies rose amid a rally in the larger energy and natural resources sector as crude oil prices rocketed.
- Century Aluminum (NASDAQ:CENX) +28.44%; Century and other US metals producers benefitted from relatively cheap power feedstocks, as European power prices surged to over 300% higher than US levels.
- SunCoke Energy (NYSE:SXC) +24.27%; Stock is up 42.67% YTD. Read a recent SA analysis on SXC.
- Bioceres Crop Solutions (NASDAQ:BIOX) +22.81%; The crop productivity solutions provider reported record quarterly results last month, with comparable revenues up 89% to $90.3M.
The week's top five losers among Basic Materials stocks ($300M market cap or more) were:
- Zymergen (NASDAQ:ZY) -17.81%; Stock has slid 91.42% over the past one year period
- Mp Materials (NYSE:MP) -16%; The company recently reported better than expected Q4 earnings; however sales volumes declined. The stock has fallen 18.26% so far in 2022.
- Lithium Americas (NYSE:LAC) -13.94%; The firm announced earlier this week that it is exploring possible separation of its U.S. and Argentina operations through the creation of a standalone public company focused on the development of its Thacker Pass lithium project in Nevada.
- Neenah (NYSE:NP) -11.94%; The specialty materials firm has dropped 28.18% so far in 2022. It reported its Q4 earnings last month that failed to meet estimates.
- Sylvamo (NYSE:SLVM) -11.47%; J.P. Morgan has listed Sylvamo among energy stocks facing negative impacts from the Russia-Ukraine tension.
Other materials ETFs to watch: iShares Global Timber & Forestry ETF (NASDAQ:WOOD), Materials Select Sector SPDR ETF, Vanguard Materials ETF (NYSEARCA:VAW), iShares Global Materials ETF (NYSEARCA:MXI), SPDR S&P Metals and Mining ETF (NYSEARCA:XME), VanEck Vectors Gold Miners ETF (NYSEARCA:GDX), iShares MSCI Global Gold Miners ETF (NASDAQ:RING), Global X Copper Miners ETF (NYSEARCA:COPX).