Will Gold, Mining Stocks Ride A 'V-Shaped Recovery'? Analysts Say Accumulate 'Oversold Miners'

As metals markets weather volatility, optimism for a “V-shaped recovery” is gaining traction. JPMorgan analysts Dominic O’Kane and Patrick Jones suggest China's expected fiscal stimulus could be the turning point for the sector.

With metal prices poised for a rebound, they urge investors to “accumulate positions in oversold miners” like Anglo American PLC NGLOY AAUKF, First Quantum Minerals Ltd FQVLF and Lundin Mining Corp LUNMF.

Exchange-traded funds like the SPDR S&P Metals & Mining ETF XME, the iShares MSCI Global Metals & Mining Producers ETF PICK provide diversified exposure to the metals and mining sector.

Mining Stocks Set For Revival?

The 17% decline in European metals & mining stocks since late September 2024 reflects market caution amid tariff risks and US$/CNY devaluation. However, analysts see this downturn as an opportunity for strategic investment. Anglo American faces near-term challenges, including $2 billion in impairments and delays in its diamond divestment strategy. Despite this, the company may emerge as an M&A target post the Anglo Platinum de-merger.

Lundin Mining and Norsk Hydro ASA NHYDY stand out as resilient picks, with strong fundamentals that may help them weather tariff-related uncertainties.

Analysts maintain a positive outlook on these names, expecting them to benefit from the broader market recovery.

Gold Stocks Shine Amid Market Turbulence

Gold continues to prove its mettle as a safe-haven asset, with prices projected to rise to $2,100 per ounce.

Stocks like AngloGold Ashanti PLC AU, Hochschild Mining PLC HCHDF, and Fresnillo PLC FNLPF remain key picks by the analysts, supported by strong silver production forecasts and rising demand for precious metals.

The VanEck Gold Miners ETF GDX and the VanEck Junior Gold Miners ETF GDXJ are popular ways to get exposure to gold miners’ stocks.

The analysts highlight Fresnillo's silver production strength, placing it on a Positive Catalyst Watch.

China's Stimulus: The Tipping Point?

All eyes are on the March 5 National People’s Congress, where China is expected to announce fiscal measures that could fuel a surge in metal prices.

The analysts believe these moves could trigger a sharp market recovery, solidifying the case for accumulating positions in mining stocks before a potential uptrend.