Glencore sees opportunities in volatility as first half profit rises

Commodities trader Glencore International Plc warned of volatility ahead in its key markets but saw opportunities in the turbulence as demand remains strong, with resilient prices helping to boost its first-half profit by 50 percent.
A robust outlook and a more modest than expected quarter-on-quarter drop in its closely watched marketing business - which trades commodities from grains to oil - comforted investors, who sent the stock up as much as 6 percent. "As we look across the board, we still see demand looking strong in Asia, the Chinese see buying opportunities ... so commodity prices are resilient at the moment," Chief Executive Ivan Glasenberg told reporters.
He added the market turmoil had allowed Glencore to consider acquisitions more aggressively, as the price of listed assets across the sector had dropped while private companies were less optimistic about their outlook "Is this the bottom? I don't know, but it is definitely a better time to look at acquisitions," he said. In what was taken by investors as a sign of confidence in commodities markets from the world's largest diversified commodity trader, Glencore said on Wednesday it would spend $280 million buying the shares in Australia's No 2 nickel producer Minara that it does not already own.
Glencore, which owns stakes in a long list of listed and unlisted producers, has consistently said that the ability to seize acquisition opportunities thrown up by market conditions was a key reason for its listing earlier this year, when it ended almost four decades out of the public eye. Glencore has $10.4 billion of cash, but the miner and trader has also said it will aim to keep a BBB credit rating.
Glencore reported adjusted earnings before interest and tax (EBIT) of $3.3 billion, in line with forecasts, while net income rose 57 percent to $2.45 billion. Shares in the group, battered during the market rout, were up 3.3 percent at 402.5 pence at 1215 GMT, outperforming the sector but still well below their listing price of 530p.