Trump says Iran war "close to over" amid hopes for more negotiations
Investing.com -- HSBC upgraded Glencore to Buy from Hold and hiked its target price to 620p from 510p on Tuesday, as the bank reshuffled its EMEA mining coverage to reflect the commodity market disruptions stemming from the Middle East conflict.
It also maintained Buy ratings on African Rainbow Minerals and Exxaro Resources while keeping a Reduce on Antofagasta.
Analyst Shilan Modi said aluminium, copper, platinum, and rhodium remain HSBC’s preferred metals. The Middle East accounts for roughly 23% of ex-China aluminium production, making it the commodity most directly hit.
Beyond aluminium, Modi flagged a range of second-order effects — including sulphur scarcity, freight disruptions, and cost inflation — that could weigh on commodity markets for months even after any ceasefire.
“Metals prices were already being squeezed higher by supply disruptions over the past several years,” the analyst wrote. “Potential further disruptions to the global supply chain and cost inflation will help support prices at elevated levels, in our view.”
“The key risk centres around demand destruction from lower economic growth,” he added.
Thermal coal received the largest forecast upgrade. HSBC raised its 2026 spot price estimate by 29% to $135 per tonne, citing concern over potential energy shortages. That revision underpins much of the positive thesis on Glencore and Exxaro, both of which carry significant coal exposure.
For Glencore specifically, HSBC also raised its near-term marketing EBITDA margin estimates, arguing the trading house stands to benefit from rapid commodity price swings and increased demand for traded energy.
Modi noted that an upside scenario — involving outperforming marketing margins and a ferrochrome restart in South Africa — could push the stock’s fair value as high as 685p.
Exxaro’s target price was lifted sharply to ZAR300 from ZAR250, with Modi arguing the South African miner "could generate excess cash returns over the next 12-18 months as coal and iron ore prices are relatively elevated," potentially supporting higher dividends or acquisitions following its recent manganese asset purchase.
For African Rainbow Minerals, the bank raised its target price to ZAR290 from ZAR285, citing improving PGM fundamentals and potential cash returns from its Harmony Gold stake. The bank also raised its EBITDA multiple for the company’s coal assets from 3x to 4x, reflecting its view that energy shortages could support "sustained cash generation from the assets."
On the macro backdrop, HSBC economists estimate global inflation will accelerate to 3.5% in 2026, with global growth slowing from 2.8% to 2.5%. The bank flagged a more severe scenario in which the Strait of Hormuz remains effectively closed for an extended period, potentially tipping parts of the world into recession.
EMEA miners generally hold about four weeks of fuel onsite, which Modi said provides a buffer but may not be sufficient if shipping disruptions persist, with bunker fuel shortages posing the largest risk to export supply chains.