The recent runup in iron ore prices, and shares in the companies that mine the key component in steel making, is a trap.
Analysts think so and so do mining companies' senior management. Investors should heed their warnings.
Followers of the likes of Rio Tinto (
STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks with serious upside potential in the next 12-months.
Yet as the year has unfolded iron ore prices have taken off. Last week the benchmark spot price for ore with 62% content delivered to the Chinese port of Qingdao hit a 15-month high of $68.70 per ton, though it had fallen back to just below $63 by Wednesday.
What's behind this remarkable turn of fortunes? Chinese cab drivers, according to a recent note by Sean Callow, an analyst at Australia's Westpac. Fortunately, for Chinese commuters, he isn't referring...