Analysis of the reaction of mining stocks to the development of copper prices

Abstract

The mining sector is still one of the most fundamental ones in today´s economy, providing raw material to probably every industry. Accordingly, mining has a great influence on stock markets and investors worldwide. Following this importance of the mining industry, some research has been conducted, analyzing the development of mining stocks and its influencing factors. This research has so far neglected copper, as probably the second most important mineral after gold, and the influence of copper future prices on copper mining companies´ stock returns. Furthermore, it missed consideration of an international perspective, as most research focused on single stock markets, majorly in the United States of America. A last detected research gap, is the influence of the global financial crisis of 2008 on stock returns in the mining industry. This has partly been considered for individual stock exchanges (Lima), but not on an international scale.