Shares of Singapore-listed commodities firm Noble Group rose as much as 5% on Monday, helped by hopes of an earnings rebound and buzz generated by a planned merger involving industry giants Glencore International and Xstrata, reported Reuters.
“Now there’s more optimism coming back into the commodity sector with Glencore and Xstrata looking at a merger, so Noble is rising on the momentum,” said a trader.
“Now there’s more optimism coming back into the commodity sector with Glencore and Xstrata looking at a merger, so Noble is rising on the momentum,” said a trader.
Several analysts also expect Noble to report a profit for the quarter ended December following its first quarterly loss in 14 years for the July-September period.
By 11:55 a.m., Noble shares were up 4.7% at $1.46, outperforming the 1.4% rise in the broader Straits Times Index.
Glencore is set to offer a bigger-than-expected premium to seal its proposed US$88 billion ($109.5 billion) merger with global miner Xstrata Plc, the Financial Times reported on Monday.
Noble posted a net loss of US$17.5 million for its third quarter, reversing a US$157 million net profit a year earlier, hurt by cotton farmers’ defaults, mark-to-market losses on carbon credits and the depreciation of the Brazilian real.
Singapore brokerage Kim Eng said it expects Noble to return to profitability as cotton prices have stabilised and the real has recovered. Further write-downs on carbon credits are likely to be limited, Kim Eng added.
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