Glencore Xstrata offers investors good potential for capital growth

As Glencore Xstrata reports Q2 results, Helal Miah, investment research analyst at The Share Centre, explains what they mean for investors.
 
"This morning, Glencore Xstrata released its half year production report (on a combined basis) that showed copper production of 673,400 tonnes, up 20% from the previous year boosted by production increases at its African mines. Investors will also be pleased to see gold production up 14% and coal production in Columbia up 22% after a successful expansion plan, however Zinc production was down by 3%.
 
"Although the mining sector has had a poor time recently we recommend Glencore Xstrata as a ‘buy' for investors. The company has a unique business model; a fully integrated commodities company with operations involved in extraction, processing, storage, freight and logistics to marketing and sales. The merged business should now allow for scale of production to extract metals, energy and soft commodities in five continents.
 
"As the global economy shows signs of improvement and the positive impact this may have on commodity prices, we believe an investment into Glencore Xstrata now poses less risk with a good potential for capital growth."