Investors can pick up metals on the cheap. Commodities markets have been weakened on concerns that the U.S. and China trade war dispute will slow global growth and hurt demand, with base metals prices hovering in bear market territory.
Metals producers are similarly wary of spending in an uncertain trade environment.
“We’re not going to start investments until we have clarity about the ultimate outcome of all these current uncertainties,” CEO Richard Adkerson said on an October earnings call.
The lack of investments in the metals space could mirror what occurred previously in the oil market. Back in 2015 and 2016, a 25% plunge in spending on new projects helped contribute to the rally that sent crude prices to a near four-year high this year.
For more information on the commodities market, visit our commodity ETFs category.