Sector movers: Mining stocks rise strongly, Glencore Xstrata gains

17th Mar 2014 14:33

The FTSE 350 mining sector, which fell nearly four per cent last week on the back of uncertainties surrounding Ukraine and fears of a slowdown in China, recovered strongly on Monday with Glencore Xstrata among the best performers in London.Glencore Xstrata was trading 3.3% higher at 306.8p this afternoon on speculation that it is close to a deal to sell its Las Bambas copper mine in Peru.According to The Wall Street Journal, Glencore Xstrata and Chinese state-controlled copper firm China Minmetals Corp are hoping to sign an agreement at a final meeting on Tuesday.The proposed disposal of Las Bambas, expected to be valued at around $5bn, was agreed by Glencore at the time of its merger with Xstrata in May 2013 in an effort for the deal to win approval from Chinese regulators.Speaking earlier this month, analysts at Jefferies said: "We expect at least a portion of what should be circa $5bn of proceeds from a Las Bambas sale to be returned to shareholders via a special dividend."Other mining stocks were performing well today, with heavyweights Anglo American, BHP Billiton and Antofagasta also making decent gains.As of 13:30 three month copper futures were moving higher by 0.6% to $6,542.50 on the LME.Meanwhile, precious metal miners Pan African Resources, Polymetal and Petropavlovsk were in demand as gold prices continue to trade near a six-month high.Despite the recent run in gold, Canaccord Genuity believes prices have further to go: "Given the worries of further potential corporate bond defaults in China and global geopolitical tensions between Russia and the West over Ukraine we see potential for the gold price to rally further in the near term."The broker lifted their average gold price estimate for 2014-2018 by 6% to $1,354 per ounce and their long-term projection by 5% to $1,455 per ounce.Top performing sectors so far todayIndustrial Metals & Mining 819.46 +2.97%Mining 16,365.06 +2.45%Forestry & Paper 11,762.32 +2.06%General Retailers 2,957.50 +1.98%Software & Computer Services 1,178.61 +1.97%Bottom performing sectors so far todayFood & Drug Retailers 3,947.01 -0.95%Beverages 13,190.39 -0.43%Tobacco 36,527.18 -0.23%Health Care Equipment & Services 5,222.23 -0.02%BC