June 30, 2010
Peabody, Coal Companies Slip on Slowing China Growth
June 29 (Bloomberg) -- Peabody Energy Corp., the largest U.S. coal mining company, led producers lower on concern that economic growth in China is slowing, damping demand for the power plant and steelmaking fuel.
Peabody dropped $2.57, or 6 percent, to $39.92 at 12:19 p.m. in New York Stock Exchange composite trading. Alpha Natural Resources Inc., the third-biggest U.S. coal company, lost $1.72, or 4.7 percent, to $34.72. Massey Energy Co., the sixth-largest U.S. coal producer, fell $1.51, or 5 percent, to $28.69.
The Conference Board’s April gauge for China’s economic outlook indicated a weaker expansion. The gauge of the economy’s outlook rose 0.3 percent, less than the 1.7 percent gain it reported June 15. Coal companies have targeted the country as a source of growth.
“I don’t know how much we can keep talking about the same thing as a problem, but it is,” said James Rollyson, an analyst at Raymond James & Associates Inc. in Houston.
Patriot Coal Corp., the fourth-largest eastern U.S. coal company, slipped 77 cents or 6 percent, to $12.20. Walter Energy Inc., a southern Appalachia coal company, declined $3.35, or 5 percent, to $64.19. Arch Coal Inc., the second-biggest U.S. coal company, tumbled $1.42, or 6.6 percent, to $20.18. Consol Energy Inc., the coal and natural gas producer, plummeted $1.56, or 4.3 percent, to $34.74.
The companies also fell four days after China’s Natioanl Development and Reform Commission, the country’s top economic planner, ordered coal producers in the country to keep prices of the fuel stable to stem inflation.
China, the world’s largest user of coal, increased imports of the fuel by 17 percent from a year earlier to 11 million metric tons, according to data released June 20 by the General Administration of Customs.
By Mario Parker
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