Citi estimates global growth will be modestly higher in 2020, which is bullish for commodities. The broker is positive about hard coking coal in the first quarter of 2020, expecting the price to average US$170/t over the year.
The alumina market is expected to move to a modest deficit in 2020. The broker remains cautious on iron ore and expects sizeable oversupply over the next two years will bring down benchmark prices to US$60/t by 2022.
Rio Tinto’s rating is downgraded to Neutral from Buy, to reflect the outperformance in the stock over the past 12 months, and the target is reduced to $100 from $105.
Target price is $100.00.Current Price is $99.10. Difference: $0.90 – (brackets indicate current price is over target). If RIO meets the Citi target it will return approximately 1% (excluding dividends, fees and charges – negative figures indicate an expected loss).