Although it has been a bit of a rocky road over the last couple of weeks, I expect the positive outlook for the global economy will lead to the resources sector outperforming in 2018.
I think that this could make it well worth having a little exposure to the sector in your portfolio.
With that in mind, are these resources shares in the buy zone today?
BHP Billiton Limited (ASX: BHP)
I think recent share price weakness has brought the mining giant's shares down to a very attractive level. Especially with strong global economic growth likely to support favourable prices for the commodities that BHP Billiton mines. This should put the company in a position to deliver another solid profit result and consider a further dividend increase. At the current share price the miner's shares provide a trailing fully franked 4.3% dividend.
Kidman Resources Ltd (ASX: KDR)
This prospective lithium producer's Mt Holland project has the potential to be a world class asset in my opinion. Last year the company signed a strategic joint venture with lithium giant Sociedad Quimica y Minera de Chile which puts it on course to commence production later this year. This month Kidman is due to release its Earl Grey project mineral resource estimate. I would suggest investors hold tight until that is released and focus on companies that are already producing the metal for now.
OZ Minerals Limited (ASX: OZL)
This leading copper producer could be a good option for investors. Demand for the metal used widely in power and construction is expected to be strong again this year, putting OZ Minerals in a solid position to profit. Earlier this week analysts at Citi retained their buy rating and $11.10 price target on OZ Minerals' shares. This implies potential upside of 20% for its shares over the next 12 months.
