Commodities Traders Punked: China Balks at Expanded Stimulus Idea

The entire energy and metals sectors are selling off today as Chinese Premier, Wen Jiabao, speaking at the opening of China's National People's Congress, did not announce an expanded stimulus package -- a rumor which caused a sharp jump in energy and materials stocks yesterday.

The Premier did, however, reiterate his view that the Chinese economy will grow 8% this year. This was not enough to outweigh hopes that the Chinese government was ready to inject billions more in an attempt to spur stronger growth.

Around the commodities/energy complex:

• BHP Billiton (NYSE: BHP) down 5%
  
• Rio Tinto (NYSE: RTP) down 5%
  
• ExxonMobil (NYSE: XOM) down 3.3%
  
• Freeport McMoRan (NYSE: FCX) down 2.5%
  
• Alcoa (NYSE: AA) down 12% - the stock also had its price target reduced from $6 to $3 at Bank of America.
  
• US Steel (NYSE: X) down 6.7%
  
• Peabody Energy (NYSE: BTU) down 2.8%
  
• Potash (NYSE: POT) down 6% - RBC Capital reduced its price target on the stock from $140 to $110.

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