Mining sector appears attractive to investors

Investors have been tempted by the mining sector after fears that commodities and metal prices could be about to decline.

Broker, TD Waterhouse, has noted that the latest developments have meant that the mining sector is appealing to investors as their customers have experienced a profit in recent days.

Angus Rigby of TD Waterhouse said it has been an energised week for the industry with continuing fears over the global economy and concerns that commodities and metal prices could be next in line for a hammering.

The ongoing volatility in the markets has had an impact on share prices in the financial sector which has led to investors buying heavily into UK banks in an attempt to turn this to their advantage, TD Waterhouse added.

TD Waterhouse concluded that the most popular share buys this week has been Barclays, Lloyds TSB, Northern Rock and the Royal Bank of Scotland.

Earlier this month, the mining sector paced the advance on consolidation hopes after aluminium companies Chinalco and Alcoa bought a 12% stake in Rio Tinto.

Chinalco and Alcoa confirmed that they do not currently intend to make an offer for Rio Tinto, but reserve the right to announce an offer or possible offer for the company. This news lifted the entire mining sector, with Antofagasta up 7.3%, Anglo American up 5.8% and Vedanta Resources increased 9%.

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