Glencore Slides as Recovery Fades After Three-Day Roller Coaster – by Thomas Biesheuvel and Jesse Riseborough (Bloomberg News – October 1,2015)

Glencore Plc’s rebound ran out of puff after a two and a half day ascent that briefly recouped the $6 billion in market value it lost Monday.

The shares slid 3.1 percent to 88.72 pence by 2 p.m. in London after earlier gaining as much as 8.2 percent. Trading was halted for five minutes because of increased volatility.

Investors in the stock could probably do with the breather. Glencore has endured a roller-coaster week with unprecedented volatility for a company that went public in 2011 at 530 pence a share.

The mining and trading firm sank 29 percent on Monday to 68.62 pence on concern over its debt load and ability to withstand sinking commodity prices. It spent most of the rest of the week recovering those losses as investors spied a bargain.

Glencore sought to reassure investors on Tuesday, saying it had “absolutely no solvency issues” and its funding was secure. It also aimed to raise more than $1 billion selling future gold and silver output, according to two people familiar with the situation.

No Stone

“It seems the company is now leaving no stone unturned in order to pay down debt,” Investec Plc said in a note to investors on Thursday. “Maybe the quiet voice of reason is beginning to be heard.” The same investment bank on Monday had said there would be little value left for Glencore’s shareholders should low commodity prices persist.

Chief Executive Officer Ivan Glasenberg is working on a debt-cutting plan including sales of assets, halting dividends and a $2.5 billion share sale completed last month. Glencore hired banks to sell a stake in its agricultural business, said people familiar with the deal.

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