Morgan Stanley has capitulated on its recent call for investors to dive back into the beaten-up lithium sector after another surge in supply collided with concerns about US electric vehicle demand, dashing hopes for a hotly anticipated rebound in prices.
The broker turned positive on lithium in December, tipping production cuts would ease the oversupply of the battery metal that has plagued physical markets. It also declared prices had bottomed and equities had corrected enough for “patient investors to re-enter”, nominating Mineral Resources as its top pick which has since dived another 40 per cent
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