Murchison Metals (ASX:MMX) dropped as low as $1.51 today before announcing a trading halt pending an announcement. The precipitous drop was especially striking given the rest of the market moved up substantially; in blunt contrast BHP Billiton (ASX:BHP) was up 1.6% at midday.
Murchison Metals announced just days ago that the Jack Hills Iron Ore Project had increased in mineral resources by 220M tonnes on the previously reported figure. Murchison Metals has a 50% ownership in Crosslands Resources Ltd which is the owner of the Jack Hills Iron Ore Project.
And back in June things looked rosy for the mining company with new Murchison Metals CEO Andrew Caruso securing letters of intent from steel mills around Asia to purchase 50 million tonnes of iron products from the Jack Hills’s Project.
But investors have been understandably wary of the stock since it dropped from it’s April 15th high of $3.12 to less than half of that six months later. And last week’s full year results did nothing to stem the decline with the company posting an FY2010 loss of $21.5 million.
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