Metso Declines as Danske Sees Mining Weakness: Helsinki Mover
Stock Chart for Metso OYJ (MEO1V)
Metso Oyj (MEO1V), a Finnish maker of rock crushers and mineral-processing equipment, fell the most in seven weeks after Danske Bank A/S urged clients to sell the stock after Australian suppliers signaled weaker mining demand.
Metso dropped as much as 4.4 percent, the biggest intraday decline since April 2. Shares in the Helsinki-based company traded 3.6 percent lower at 12:54 p.m., making it today’s biggest decliner among Finnish benchmark stocks. Its trading volume in Helsinki exceeded 85 percent of the three-month daily average.
Profit warnings from several Australian mining contractors indicate that suppliers are starting to feel the effects of postponed mining projects, Danske analysts said in a note today, dropping Metso’s recommendation from hold. Mining and energy projects worth about A$150 billion ($147 billion) have been delayed or canceled in the past year in Australia.
Australia’s Transfield Services Ltd. (TSE), Fleetwood Corp. and UGL Ltd. recently downgraded their profit forecasts as major customers defer projects amid falling commodity prices. BHP Billiton Ltd., the world’s largest mining company, Glencore Xstrata Plc and Vale SA are among those deferring projects and cutting back on spending.
Outotec Oyj, a Finnish mining equipment supplier, was downgraded to hold from buy by Danske. Its shares declined as much as 2.1 percent.
“While the warning companies mainly operate in Australia, they cite global demand weakness both in capex and aftermarket businesses,” Danske’s analysts said.
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