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Trump win a boost for miners

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As Donald Trump's shock presidential election victory ripples through financial markets, it's far from doom and gloom for metals producers, according to Jefferies Group LLC.

[SANTIAGO] As Donald Trump's shock presidential election victory ripples through financial markets, it's far from doom and gloom for metals producers, according to Jefferies Group LLC.

Miners such as Freeport-McMoRan Inc are set to benefit on the prospect of increased US infrastructure spending that pushes up demand for copper and other mined commodities at a time of tightening global supply, Jefferies analysts including Christopher LaFemina wrote in a note to clients Wednesday. A weaker dollar would also be a positive for copper and gold.

"Trump is high risk but should be positive for Freeport," the analysts wrote. "We expect Freeport to break through US$15 a share over the next year, with much greater upside thereafter." The Phoenix-based miner, which is the largest publicly traded copper producer, has gained 79 per cent to US$12.09 this year after tumbling 71 per cent last year. Miners are emerging from the worst commodities slump in a generation that pummeled their debt metrics.

Mr Trump, who has called for US$1 trillion of infrastructure investment over the next decade, reiterated the importance of infrastructure spending in his victory speech.

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"An increase in infrastructure spending, corporate tax cuts, and lower income tax rates could be a positive for US growth even if funded with deficit spending," the analysts wrote. "The miners should benefit from improvements in demand in the US."

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