The HSBS flash PMI for June raised to 50.8 from May's 49.4, higher than the expected 49.7. The higher number may help firm up iron ore prices due to Chinese demand.
Despite the positive PMI data, analyst firm Credit Suisse does not see any real strength ahead. The firm forecasts iron ore prices to average $90 a ton in the second half of 2014, with averages of $89 a ton in 2015 and $87 a ton in 2016.
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TheStreet Ratings team rates VALE SA as a Hold with a ratings score of C. TheStreet Ratings Team has this to say about their recommendation:
"We rate VALE SA (VALE) a HOLD. The primary factors that have impacted our rating are mixed -- some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its good cash flow from operations, largely solid financial position with reasonable debt levels by most measures and expanding profit margins. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, disappointing return on equity and a generally disappointing performance in the stock itself."