The Dow Jones Industrial Average fell 1,232.01 points, or 4%, to 29,590.41 for the Sept. 19-23 trading week, while the S&P 500 fell 180.1 points, or 4.7%, to 3,693.23.
Finding value winners has been a challenge for markets in a dark week as heightened geopolitical uncertainty, persistently high inflation readings and soaring interest rates continued to anger investors. Nexa Resources was among just three miners to post a profit this week, adding $20 a share to close at $5.18 after ending the previous week at a 12-month low. On September 14, Nexa announced the appointment of former Managing Director of Compañía Minera Antamina, José Carlos del Valle, as SVP of Finance and CFO, effective October 3. During his nine years at Antamina, del Valle led a company-wide transformation and secured a $1 billion syndicated loan. Nexa also reported on September 12 that a roadblock to its zinc mine at the Atacocha San Gerardo open pit in Peru had been lifted and the operation had resumed production. The company believes the disruption will cost 400 tonnes of zinc production, but it expects to make up the difference and its production guidance remains unchanged at 118,000 to 127,000 tonnes this year.
Based in Brazil valley also posted a gain this week, adding 6 cents a share to close at $13.04. Brazil-based companies exposed to base metals have done well amid the carnage in North American markets, with investors generally favoring base metals. Vale’s integrated base metals investment base is a compelling investment proposition. During its investor days in early September, the company struggled to explain how it was tackling initiatives aimed at restarting the business for better performance and future replacement and resource growth opportunities. Vale’s strategic plans indicate a base metals business with significant three to five year growth potential (subject to execution and securing of capital expenditures). Analysts also believe some form of base metals split remains likely.
In the meantime, Kinross Gold was also among the gainers this week, adding 2 cents a share to close at $3.31 a share. On Sept. 19, Kinross announced that it intends to repurchase $300 million of its stock before the end of this year. It added that it will use 75% of excess cash for buybacks in 2023 and 2024. Kinross said the updated strategy came from discussions with Elliott Investment Management and an unspecified number of other investors. It also warned that buybacks in 2023 and 2024 are contingent on the company’s net debt ratio remaining below current levels, stating that the buybacks would happen in the event of a rating downgrade, a significant drop in the price of gold, or major operational setbacks would be exposed.