Bmrboy, I don't think this had much to do with the base metals. Inventories continued down on most but all the metals fell and the stocks fell even more.
The herd mentality struck and Wall St has been itching to bail out of commodities for weeks. The weakness in oil gave them their excuse.
I think the base metals that have genuine shortage concerns like nickel and zinc should come back. Also positive in the medium near term are upcoming earnings reports. They should be very positive for the stocks. If the whole market is in a funk, it may not matter as good earnings will be ignored.
I am sticking with my favorite base metal stocks. I want stocks that are currently profitable with low p/e's or near term producers that seem undervalued based on their projected production. Most of my near term plays have started production and will report earnings for part of Q3 but probably for a full qtr in Q4.
I bought more of my favorites today but there could be more weakness. Gold isn't in a shortage and the Central Banks can initiate a downturn by simply selling tons of the stuff.
Gold and Oil are the two bellweather commodities. If both are weak for various reasons, I think the base metals stocks are going to struggle to be the exception. However over time, I still think they are a good play.
Today EZM got hammered but they are coming up on their first qtrly report with zinc production. When they merge with Lundin, they are going to be a metals powerhouse with lots of cashflow and increased production coming.
Good luck. Speculative stocks with no short term earnings potential might sell off more than the actual producers. Might want to pare back on some of those if you are overweight. Bobwins
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