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The S&P materials index fell -0.95% this week, and the Materials Select Sector SPDR ETF (XLB) -0.89%. This week’s news was dominated by economic data on inflation from the latest US Consumer Price Index report and what it meant for the future of the Federal Reserve’s rate hike trajectory.
The report led to a strong dollar, which sent gold futures (XAUUSD:CUR) lower to its lowest price in more than five weeks. Prior-month Comex gold (XAUUSD:CUR) for February delivery closed -1.1% at $1,834.20, the lowest most active contract close since January 5, while February Comex silver (XAGUSD:CUR ) closed -1.3% at $21,546/oz.
Aluminum prices in London also fell to a fresh five-week low during the week as the rapid build-up of inventories in exchange warehouses continues. Copper prices in London (HG1:COM) also fell 0.4% to $8,989.5 a tonne, hitting a five-week low on Thursday.
Here are this week’s top gainers among basic materials stocks (market cap $2 billion or more):
- Affairs (MTNR) +30.53%; Shares rose on better-than-expected fourth-quarter earnings and record value-added sales.
- Aviento (AVNT) +12.83%; The materials solutions company beat fourth-quarter estimates and released an upbeat outlook for 2023.
- Scotts Miracle Gro (SMG) +11.98%; Stocks got a boost after an update from Wells Fargo Securities citing the potential to increase its profit margin by keeping expenses in check.
- Ecolab (ECL) +10.36%; Shares hit a three-month high this week after quarterly earnings that were better than Wall Street’s median estimate.
- Reliance Steel and Aluminum (RS) +8.53%; The company’s fourth quarter results beat leading expectations and issued a strong outlook for the coming quarter.
Take a look at the biggest losers among basic materials stocks:
- West Fraser Timber (WFG) -9.47%; Inventory write-downs hurt the wood products company’s margins, leading to lower-than-expected fourth-quarter earnings.
- Agnico Eagle Mines (AEM) -9.12%; Shares fell to a three-month low after weaker-than-expected production guidance and higher costs at the end of its fourth quarter.
- Ufp Industries (UFPI) -8.81%
- Hecla Mining Company (HL) -8.50%; The stock took a hit after reporting GAAP fourth-quarter earnings and revenue that missed expectations and posting disappointing guidance for fiscal 2023 gold production.
- CF Industries (CF) -7.78%; The company’s fourth quarter results fell short of leading expectations.
Other material ETFs to consider: iShares Global Timber & Forestry ETF (WOOD), Materials Select Sector SPDR ETF, Vanguard Materials ETF (VAW), iShares Global Materials ETF (MXI), SPDR S&P Metals and Mining ETF (XME), VanEck Vectors Gold Miners ETF (GDX), iShares MSCI Global Gold Miners ETF (RING), Global X Copper Miners ETF (COPX).
