Are these FTSE 100 shares brilliant buys right now?
I’m searching for the best FTSE 100 stocks to buy today. Could these big-cap stocks be too good for me to miss?
Buying commodities stocks seems to offer increasing near-term risk as China’s economy cools. In its latest forecasts, the IMF slashed its GDP growth forecasts for the raw-materials-hungry economy to 4.8% from 5.6% previously. Things could get much grimmer too if the Asian country’s real estate sector collapses.
But as a long-term investor, I’m seriously considering snapping up Antofagasta (LSE: ANTO) shares. As one of the world’s biggest copper producers it’s well-placed to exploit soaring demand for the red metal over the next decade. In a report last summer Australia’s Department of Industry, Science, Energy and Resources predicted that global copper demand will soar 31% by 2030.
Soaring sales of copper-loaded consumer electronics will push commodity demand off the scale. So will growing demand for electric vehicles and huge renewable energy investment as concerns over climate change intensify. Antofagasta can also look towards huge infrastructure investment across the world to boost demand for its product as well.
If the outlook for Chinese (and indeed global) growth starts to look too shaky though, I might go shopping for Polymetal International (LSE: POLY) instead. As a major gold producer it’ll be well-placed to exploit soaring demand for safe-haven assets if economic conditions steadily worsen. I’m already expecting this FTSE 100 commodities producer to thrive as rocketing inflation boosts investor interest in hard currency gold.
The prices Polymetal gets for its product might also rise if geopolitical tensions also continue to rise. Indeed, gold just hit two-month highs, near $1,850 per ounce, as tensions between Russia and the West over Ukraine escalated.
I think there’s plenty of scope for further gold price gains that could push Polymetal’s share price higher. Though bear in mind that there are many factors that dictate bullion values. Sharper-than-expected central bank rate hikes and a strong US dollar are a couple of phenomena that could in fact pull gold prices lower.
Market appetite for some travel stocks like International Consolidated Airlines (LSE: IAG) has picked up in recent sessions. This is because the British government’s decision to scrap Covid-19 tests for incoming travellers seems to have boosted holiday bookings already. Package holiday operator Jet2 saw bookings leap 30% week-on-week when these rule changes were announced.
It stands to reason then that IAG might also see ticket sales across British Airways, Iberia and other brands soar in the weeks ahead. However, it’s too early to claim the cloud of Covid-19 has lifted for such stocks. Infection rates continue to climb steeply in parts of Europe. Meanwhile, lawmakers in China have reintroduced some restrictions due to new coronavirus cases there.
The threat of wider travel restrictions remains a severe one for companies like IAG then. The prospect is particularly dangerous for IAG too given the enormous amount of debt it carries (€12.4bn as of September). I’d rather buy other less risky FTSE 100 shares today.
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Royston Wild has no position in any of the shares mentioned. The Fintech Zoom UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Fintech Zoom we believe that considering a diverse range of insights makes us better investors.
Fintech Zoom UK 2022