Major ASX miners copped a beating on Wednesday as trade concerns prompted by the Trump administration's approach towards China were blamed for falling global markets.
The Fortescue Metals Group Limited (ASX: FMG) share price dropped by 4.59% to $4.37 on Wednesday, adding to losses approaching 30% sustained by investors in the iron miner over the past year.
Fortescue Metals announced earlier this week that it cut the price of low-grade iron ore due to a range of factors but acknowledged that mounting trade tensions between the United States and China were having an impact.
"The updated guidance reflects a slower than anticipated recovery in contractual realisations due to Chinese construction activity remaining subdued, the extension of temporary production restrictions in certain provinces in China as well as speculation regarding the potential impact of global trade tensions," Fortescue stated.
But it appears Citi is betting that the Fortescue share price will not be recovering in the near future and the company's investors are set to be hit with more losses as the broker downgraded its price target on Fortescue shares to $4.10.
BHP Billiton Limited (ASX: BHP) shares also dropped, shedding 1.1%, and the Rio Tinto Limited (ASX: RIO) was down by 1.04%.
Rio Tinto also announced on Wednesday that it has entered an agreement with private equity manager EMR Capital and PT Adaro Energy Tbk, an Indonesian coal company, to sell its entire 80% interest in the Kestrel underground coal mine in Queensland for $2.25 billion.
Rio Tinto chief executive Jean-Sebastien Jacques said "the sale of Kestrel, together with the announced divestments of Hail Creek and our undeveloped coal projects, delivers exceptional value to our shareholders and will leave our portfolio stronger and more focused on delivering the highest returns through targeted allocation of capital".
The deal is set to be completed in the second half of 2018, subject to regulatory approvals and other conditions being satisfied.
