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Rise in iron ore price boosts construction related stocks

Announcement posted by de2 Communications 14 Mar 2016

14 March 2016: SYDNEY -- Global construction companies are enjoying solid support from investors and this is having a positive knock on effect on local construction stocks.

"We are seeing a similar recovery in construction services Monadelphus, which has developed a significant reversal pattern in price," said Gary Burton, senior analyst at CFD and FX broker FP Markets.

According to Burton, the engineering services company has seen about 40 per cent recovery for its lows.

"We are seeing a similar recovery in Bradken and UGL," Burton said.

He pointed out that "On the back of a recovery in base metals prices and with the price of iron ore over $50 tonne this sector is looking to be in the early stages of recovery."

According to Burton, despite the adverse media in the banking sector the four big banks have opened strongly and look to be recovering from the recent selloff.

"The cautionary factor in this financial sector is the low volumes of the past 3 weeks, which suggest this is not a conviction move higher," Burton added.

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