European mining shares down 15 in 2023
China stimulus has lifted STOXX basic resources
Equity strategists prefer copper miners over diversified

LONDON, Sept 15 Reuters Investors are finally seeing potential in European mining shares, as China39;s stepbystep economic stimulus is steadily laying the foundations for a recovery of the unloved sector.

The STOXX Europe 600 mining index has fallen 15 this year, making it the worst performing sector in the region by some margin, with secondplaced real estate down 4.5 and the topperforming retail index up 27.

The metals and mining sector is typically used as a proxy for equity investors in Europe to gain exposure to China, given it is the world39;s largest commodities consumer, and it has sunk along with China39;s growth expectations.

The world39;s secondlargest economy has been struggling after a brief postCOVID surge, dragged down by huge debt due to decades of infrastructure investment and a property downturn. Analysts forecast the economy will grow by just 5 this year, the slowest rate, outside of COVID years, since 1990.

But Beijing in recent weeks has taken targeted steps towards supporting key pockets of its economy, lifting the mining sector off its 31month lows. In the last month, the mining index has risen nearly 10 compared with a gain of just 2.5 for the wider STOXX 600.

China is building a wall of stimulus, but they39;re doing it brick by brick, said Nathan Sweeney, chief investment officer of multiasset at…