J.P.Morgan's Paul Brunker recommends energy over mining when it comes to taking advantage of key themes in Australia's resources sector. Investors in the market are applying two angles on resources stocks. First, the sector is seen as a way to play a weaker AUD. Secondly, as we work through the capex cycle there is an argument for looking at the FCF of resources companies. FCF is stronger with energy given the size of LNG projects and the underlying commodity being less volatile than industrial metals and less dependent on China, which looks increasingly challenged in the near-term. (VIEW LINK)
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