Giant miners hit 30-year lows

Mining stocks took a dip on Tuesday, as major companies such as Glencore Xstrata (LON: GLEN) and world’s No.1 BHP Billiton (ASX: BHP) reported massive writedowns.

Glencore’s stock was down almost 2.5% in London at 3:32PM GMT, while BHP lost 1.4% of its value in Australia and was falling in New York this morning.

According to analysts quoted by CNBC, resource companies are now the cheapest they have been in 30 years, relative to the market. But the experts also said stocks could quickly recover as soon as interest rates begin rising.

Most miners are currently facing fairly high fixed costs after making large investments between 2009 and 2011, when commodity prices were high. They are also seeking to win back investor trust, which suffered when some shareholders criticized relatively large executive pay and meagre shareholder payouts.

Image by The Library of Congress

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