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Why these 3 ASX 200 mining shares are struggling in January

Kenneth Hall
businessman watching gold coins fall down

It’s been a solid start to the year for the S&P/ASX 200 (INDEXASX: XJO), with the benchmark Aussie index climbing 3.56% higher in 2020 so far, but the ASX 200 mining shares have largely underperformed.

Here’s why these 3 big-name Aussie miners are among the worst-performing of Australia’s largest listed companies.

Which 3 ASX 200 mining shares are falling lower?

The Regis Resources Limited (ASX: RRL) share price has been under pressure to start the year.

Regis is an Australian gold production and exploration company that boasts a $2.12 billion market capitalisation. The ASX 200 mining stock slumped 4.14% on Friday and is down 3.92% since the start of January.

The Evolution Mining Ltd (ASX: EVN) share price fell 6.04% lower on Friday to be down 5.79% for the year. The $6 billion miner’s shares slumped after a disappointing operations update and FY 2020 production downgrade.

Evolution downgraded its estimated production range for Mt Carlton from its original 95,000–105,000 oz range to just 70,000–75,000 oz. The group’s all in sustaining cost will jump from A$800–850 per ounce to A$1,150–1,225 per ounce.

However, the hardest hit ASX 200 mining share so far this year has been Resolute Mining Limited (ASX: RSG). The Resolute share price has slumped 11.90% in less than 2 weeks to be the worst performer on the ASX 200 in 2020.

A weak fourth-quarter production update from the Aussie gold miner sent its shares spiralling lower last week. The group’s FY19 gold production came in at 384,731 ounces compared to its guidance of 400,000 ounces, and investors sold off the ASX 200 mining stock in response.

The Resolute share price capped off a disappointing week with a 9.02% share price drop in Friday’s trade.

Where else should I be looking to buy?

I think it’s interesting that all 3 of these underperforming ASX 200 mining shares are in the gold industry.

With the heightened tensions between the US and Iran, investors could be flocking to gold for safety in coming weeks. 

It hasn’t been all doom and gloom for the Aussie miners, with Saracen Mineral Holdings Limited (ASX: SAR) my favourite of the group to buy for defensive exposure at the moment.

The post Why these 3 ASX 200 mining shares are struggling in January appeared first on Motley Fool Australia.

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Motley Fool contributor Kenneth Hall has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The Motley Fool's purpose is to help the world invest, better. Click here now for your free subscription to Take Stock, The Motley Fool's free investing newsletter. Packed with stock ideas and investing advice, it is essential reading for anyone looking to build and grow their wealth in the years ahead. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson. 2020