U.S. markets feel the chill, Jan. 26-30

The final week of January was a mixed bag. On the bright side for resource investors, gold and oil prices climbed to US$1,283.10 per oz. and US$52.99 a barrel, respectively, while U.S. consumer spending also improved, rising 4.3% in the fourth quarter after a 3.2% rise in the third quarter. Overall, however, the U.S. economy grew by just 2.6% in the fourth quarter, slowing from 5% in the third quarter, and concerns about Chinese growth, oil and Greece’s new left-wing government created uncertainty in the markets. The Dow Jones Industrial Average fell 2.87% to 17,164.95 and the S&P 500 Index lost 2.77% to finish at 1,994.99. For the month of January, the Dow dropped 3.6% and the S&P 500 fell 3.1%.

Freeport-McMoRan was the most actively traded stock, falling US$2.43 to US$16.81 per share. The company has reduced planned capital expenditures, exploration and other costs for 2015 by $2 billion. In the fourth quarter, Freeport reported a net loss attributable to common stock of US$2.9 billion, or $2.75 per share, compared with net income of US$707 million, or US68¢ per share, in the fourth quarter of 2013. For calendar 2014, the company posted a net loss of US$1.3 billion, or US$1.26 per share, compared with net income of US$2.7 billion, or US$2.64 per share in calendar 2013.

Shares of Molycorp advanced 18% to US33¢ per share. Rare earth oxide equivalent production at is Mountain Pass mine in California reached 1,328 tonnes in the fourth quarter, nearly double the 691 tonnes it produced in the third quarter, and up from 1,034 tonnes in the fourth quarter of 2013. Full-year production reached 4,785 tonnes, up from 3,473 tonnes in 2013. The company said its per unit cash production costs “declined sequentially” in the fourth quarter, but did not provide a number.

Cliffs Natural Resources has started restructuring proceedings under the Companies’ Creditors Arrangement Act at Bloom Lake in Canada. “The Bloom Lake Group is no longer generating any revenues and is not able to meet its obligations as they come due,” the company said on Jan. 27. The group has suspended operations and for several months has been looking to sell certain of its Canadian assets. Cliffs shares fell 14% to US$6.42.