Valuations in mining sector look cheap

The global economy will continue to move forward, albeit not at a historically fast pace.

At the same time, interest rates are likely to remain low, which should provide a favourable backdrop for the shares of a number of the firms in the FTSE 100, many of which have a diversified earnings base and are not so tied to the fortunes of the UK economy. Some of these companies also have robust balance sheets and the ability to pay strong dividends. There are two main drivers: the prospect of the global economy enabling some earnings growth, as well as the attraction of high dividend yields. Against this background, mining stocks encapsulate the qualities we look for and are int...