Followers of mining group Rio Tinto are expecting news of a Chinese tie-up tomorrow after shares in Aluminum Corporation of China (Chalco) were suspended earlier.
Chalco's state owned parent, Chinalco, holds a 9% stake in Rio, and has indicated it would hold a signing ceremony tomorrow, with Rio executives expected to be in attendance.
That has prompted a round of speculation as to what the signing might involve, with an iron ore project in Guinea said to be the likely deal. John Meyer at Fairfax said:
The market expects Chalco to sign a deal with Rio Tinto over the Simandou iron ore project in Guinea. Rio Tinto shares could go better on this news as inking the deal should accelerate development of the world's largest undeveloped iron ore project according to Rio Tinto.
Rio Tinto is also in discussion with Chinalco over a stake in the $4.6bn Oyu Tolgoi copper mine in Mongolia.
Rio's shares have risen 32p to 3387.5p, but the rest of the market has turned lower after its early gains. The FTSE 100 is now down 20.35 points at 5345.32, with energy companies among the main losers after results from Centrica, down 6.3p at 301.4p, and BG, 32p lower at £10.31. Invensys continues to lead the fallers, down 16.9p to 276.12p following news of a poor performance in its rail business.
