Billiton Limited Share Price Dips

Shares for BHP Billiton Limited [ASX:BHP] have dipped slightly by 1.10%

They are, at the time of writing, trading for $28.66 a share. Although they have dropped in overall share value, they have still seen significant growth throughout 2017 and going into 2018.

Billiton currently have a market cap worth $152.575 billion marking them as titans in the industry.

Billiton warning of trade war

CEO of BHP Billiton feels that the US imposition of controversial import tariffs is a regrettable action and may actually spark a trade war.

Andrew Mackenzie (Billiton’s CEO) said that the 25% tariff imposed on steel imports, and aluminium’s 10%, are ‘not major perturbations to the world economy’.

Much of the steel produced in Asia using BHP’s raw materials will not be going to US as a destination, so direct impact of the US trading actions will be minimal.

He thinks the bigger risk is the conversations that will take place between major US and China companies, as they may trigger a more combative discussion in regards to trade factors between the world’s major economics.

This could lead to less free trade and less economic growth.

Trump stated that the US will apply tariffs on $60 billion of Chinese imports, while restricting transfers of technologies, and other acquisitions by companies out of China.

China rebutted by announcing plans for tariffs on US imports to the tune of $3 billion.

BHP and many other large-scale resource developers rely on China for at least half of its sales. If a trade war would break out between China and the US, their sales could be heavily impacted in the long run.

Bidding on Billiton’s assets

Blackstone Group and Royal Dutch Shell have joined in an effort to acquire multiple assets which have are being unloaded by BHP Billiton.

The bid, worth $10 billion, is an effort to obtain a large share of BHP’s U.S shale operations.

BHP — alongside its US partner, ExxonMobil — have abandoned their 20-month-long effort to sell their joint oil assets offshore Australia, deciding instead to keep ownership of the fields and accompanying infrastructure.

Regards,

Ryan Dinse,
Editor, Markets & Money

PS: Large companies like BHP Billiton could end up as a hit or miss investment. You could be in possession of a stock that is about to burst at any moment. Markets & Money’s Vern Gowdie has written a free report titled ‘Five Fatal Stocks You Must Sell Now’ which provides insightful advice on the matter.


Ryan Dinse is an analyst at Markets and Money. He has two decades of experience in financial planning, equity analysis and credit markets. Ryan combines fundamental, technical and economic analysis to identify and invest in good ideas at the appropriate stage of the economic cycle. He has a strong interest in technology, economic history and disruptive business models. His focus at the moment is as lead analyst on two of our most recent and innovative investor services, Crash Market Investor and Sam Volkering’s Secret Crypto Network. He will write about the exciting opportunities for investors to benefit from significant changes in world markets. He is a member of Fintech Australia, a former member of the Digital Currency Council, and is a fully accredited financial adviser.


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