Investing.com -- Shares of BHP Group Ltd (ASX:BHP) fell on Tuesday after the Anglo-Australian miner logged a sharp decline in its half-year profit on slowing demand in China and weakening iron ore prices, although it posited a positive outlook for the coming months.
BHP fell 2.2% to A$47.390, coming close to its lowest level since early-January. The miner’s underlying profit attributable for the six months to December 31 was $6.6 billion, compared with $9.7B from the prior year.
Total revenue from continuing operations also sank 16% to $25.7B. The drop in earnings was driven chiefly by lower realized prices on iron ore, copper, and coking coal, as demand in major market China slowed down substantially.
An economic slowdown in developed countries in Europe and the Commonwealth also weighed on demand, and is expected to continue doing so in the interim.
Still, the world’s largest miner forecast improving demand in the coming months, especially as the Chinese economy recovers after the lifting of anti-COVID measures. India is also expected to be a key source of demand for coal.
“We are positive about the demand outlook in the second half of FY23 and into FY24, with strengthening activity in China on the back of recent policy decisions the major driver. We expect domestic demand in China and India to provide stabilising counterweights to the ongoing slowdown in global trade and in the economies of the US, Japan and Europe,” BHP CEO Mike Henry said in a statement.
