# Commodities hitting resistance??



## wayneL (6 March 2006)

Could it be that the boom is nearing it's zenith. Citibank thinks so. It's not bearish so as not to scare the horses, but a few of the bigger stocks have topping patterns in place. 

The sector may not be such easy pickings now.

http://finance.news.com.au/story/0,10166,18358602-462,00.html



> GLOBAL broking giant Citigroup is advising its clients to move to a neutral position on Australian resource stocks, the first time it has gone soft on the sector since the bull run began in March 2003.
> Isolating itself among the broking fraternity, Citigroup argues that the second quarter for 2006 will be weak for the sector as commodity prices stagnate and many resource stocks remain overvalued.
> 
> While it retains a few heavyweight stocks in its portfolio, including BHP Billiton, Citigroup believes many miners are overvalued by as much as 9 per cent after the strong run of the past three years.
> ...


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## michael_selway (6 March 2006)

wayneL said:
			
		

> Could it be that the boom is nearing it's zenith. Citibank thinks so. It's not bearish so as not to scare the horses, but a few of the bigger stocks have topping patterns in place.
> 
> The sector may not be such easy pickings now.
> 
> http://finance.news.com.au/story/0,10166,18358602-462,00.html




Hi Wayne

Thanks but we already know some of this....

LME supplies, Zinc is the only base metal with upward price pressure as LME supplies continue to deplete (demand exceeds supply). The others are on unsteady legs.

http://www.kitcometals.com/charts/lmewarehouse.html

Oil should be steady for a while 50-70 a barrel, so Sugar/Ethanol likewise for now.

Thermal Coal likely to increase as costs of production increase.

Gold/Silver/Uranium hard to say.


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## Julia (6 March 2006)

Thanks for that, Wayne.

Does anyone know what the market would have done last year if resources had been removed?

Julia


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## rederob (6 March 2006)

michael_selway said:
			
		

> Gold/Silver/Uranium hard to say.




MS
I am sure you know which way is "up".


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## brerwallabi (7 March 2006)

I remember getting out of a few metals last year around the same time when we had a little dip and then picking a good few winners mid year. Whats different this year? India and China still there and absorbing at the same rates.


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## nizar (7 March 2006)

Julia said:
			
		

> Thanks for that, Wayne.
> 
> Does anyone know what the market would have done last year if resources had been removed?
> 
> Julia





i believe it was about 3%...


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## Julia (7 March 2006)

nizar said:
			
		

> i believe it was about 3%...




Thanks for that, nizar.

Julia


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