Shares in mining and commodities giant Glencore (LON:GLEN) were hammered once again Friday, with the company leading an ongoing selloff in mining stocks that has wiped out 22% of the company’s value since last Friday.
The firm, already the worst performer in the FTSE 100 index in 2015, closed almost 6% down to 123.15p. It has lost about 60% of its value since the beginning of the year and more than three quarters since listing its shares in London in 2011.
Worries about China’s economic slowdown have driven down prices of most of the commodities mined and traded by the Swiss-based company. Copper, the company’s top earner, has dropped by over 16% so far this year, recently falling to a six year low below $5,000 a tonne.
Prices for coal, another key commodity for Glencore, have also been weak and the sector shows no signs of reversing its own supply glut.
On top of the commodities rout, credit rating agency Standard & Poor’s revised Thursday its outlook for Glencore from stable to negative. The move, say analysts, could have sweeping consequences for the company’s powerful trading division.
Investors have also exited the stock because they worry Glencore may have to cut its dividend to maintain its credit rating as it seeks to lower its net debt.
Glencore plans to reduce net debt to $27 billion by the end of 2016 from $29.6 billion at the end of June this year.