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Why is the BHP share price in the red today?

We check what's going on with the Big Australian on the market on Thursday.

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Monica O'Shea
Monica is a journalist with experience working for Daily Mail Australia in Sydney and the Port Pirie Recorder and the Flinders News in South Australia. Monica completed a journalism cadetship in 2013. She also hold a B.Science (Biotechnology) with Honours from the University of Adelaide. Monica has worked in government at the local, state and federal level. Monica has a keen interest in finance and the share market and enjoys exploring the highs and lows. When not writing for Motley Fool Australia, Monica enjoys travel, sport, music, and likes to play the violin in her spare time.
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Key points
  • BHP shares are down more than 1% today 
  • The iron ore price has fallen amid news out of China
  • The ASX 200 is also in the red today 

The BHP Group Ltd (ASX: BHP) share price is sliding today amid wider market turmoil and falling iron ore prices.

BHP shares are down 1.21% and are currently trading at $43.31 apiece. For perspective, the S&P/ASX 200 (ASX: XJO) is 0.92% lower.

Let's take a look at what's going on with the BHP share price today.

a female miner looks straight ahead at the camera wearing a hard hat, protective goggles and a high visibility vest standing in from of a mine site and looking seriously with direct eye contact.

Image source: Getty Images

Iron ore prices fall

BHP is an iron ore-producing mining giant. However, BHP is not the only major iron ore producer trading lower today.

Rio Tinto Ltd (ASX: RIO) shares are down 1.27%, while Fortescue Metals Ltd (ASX: FMG) shares are sliding 3.57%.

Iron ore producers, including BHP, appear to be falling after the iron ore price fell overnight.

Iron ore futures dropped amid China lowering the price of steel products. In a research note, ANZ economist Madeline Dunk hinted iron ore prices could face more pain this year:

Iron ore futures fell sharply amid a weakening backdrop in China. Ten Chinese steel mills lowered their prices of steel products, according to Mysteel. At the same time, spot prices for rebar used in construction have slumped sharply.

The impact of China's reopening may be short lived amid ongoing underlying issues in China's property market.

This could lead to further weakness in the iron ore price this year.

The iron ore price is down 1.17% and is currently priced at US$127 a tonne, Trading Economics data shows.

The ASX is sliding today after US stocks plunged overnight amid the US Federal Reserve lifting rates by 25 basis points. The S&P 500 Index dropped 1.65%, the NASDAQ Composite fell 1.6%, and the Dow Jones Industrial Average fell 1.63%.

Commenting on the rates decision, the US Federal Reserve said "inflation remains elevated", adding:

The committee anticipates that some additional policy firming may be appropriate in order to attain a stance of monetary policy that is sufficiently restrictive to return inflation to 2 percent over time.

Share price snapshot

The BHP share price has risen 0.44% in the last year, but fallen 10% in the last month.

BHP has a market capitalisation of more than $219 billion based on the current share price.

Motley Fool contributor Monica O'Shea has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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