The company saw group revenues edging 1% higher during April-June, thanks to the resilience of its parcels market where both sales and volumes rose 2%. The structural decline in the letters market was reflected by a 2% fall in volumes and 3% revenues dip, however.

There ‘s no doubt that Royal Mail still has plenty of paddling to do to stay afloat though. Indeed, the firm noted that “we continue to face the challenges caused by the current low inflationary environment and our highly competitive markets.”

But I believe Royal Mail’s dominance of the UK market, allied with the fruits of heavy restructuring, should help it to overcome the worst of these problems.

And the roaring success of Royal Mail’s foreign operations gives further reason for cheer. The courier saw volumes and revenues at its European GLS division leap 13% during the last quarter, with sales growing across all regions.

I reckon a forward P/E ratio of 12.1 times, allied with a 4.5% dividend yield, makes Royal Mail a brilliant value pick.

Gold star

Gold digger Polymetal (LSE: POLY) has also remained stable on Tuesday despite releasing a mixed update. Shares in the business remain camped around three-and-a-half-year peaks of £11.25.

Polymetal advised that planned grade declines at Okhotsk and Omolon — allied with “traditionally volatile” grades at Dukat — forced total production 12% lower during April-June, to 262,000 ounces. Output for the first half was down 8% from the same period in 2015, at 522,000 ounces.

Still, operational improvements and de-stocking are expected to drive output higher during the second half, and full-year guidance is maintained at 1.26m ounces.

While gold prices may have retreated from recent multi-year highs of $1,350 per ounce, I reckon there’s enough macroeconomic and geopolitical turmoil to drive metal values skywards again. I reckon Polymetal is an attractive stock candidate at present, a point underlined by a terrific P/E rating of 14.2 times for 2016.

In a hole

I’m much less cheery over the investment prospects of diversified digger Rio Tinto (LSE: RIO), however. Unlike the gold market, Rio Tinto’s core segments remain haunted by fears of hulking supply/demand imbalances.

And this is likely to persist as China’s economy steadily cools — iron ore imports slumped 5.9% month-on-month in June, for example, reflecting poor domestic demand and cooling global demand.

Rio Tinto and its mining peers are trying to mitigate the prospect of prolonged commodity price weakness by hiking production. Indeed, data last night showed production from the firm’s Pilbara iron ore operations rising 8% between April and June on an annualised basis, to 80.9m tonnes.

Copper and aluminium output advanced 5% and 11% respectively, too. And expansion work like that at Rio Tinto’s Oyu Tolgoi copper project in Mongolia should keep flooding the market with material.

Against this backdrop it’s difficult to see how Rio Tinto can transform its poor earnings outlook — indeed, the City expects the bottom line to keep falling until at least 2017. So I reckon Rio Tinto is a highly-unattractive pick at present, particularly given its slight-heady forward P/E rating of 18.1 times.

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Bank gets bashed

Investors have been piling back into embattled Standard Chartered (LSE: STAN) in recent months, the stock adding 16% in value during the past three months as faith in its turnaround plan has gathered pace.

But I believe this ascent leaves StanChart looking dangerously overbought. A forward P/E rating of 42.7 times not only sails above the corresponding readings of most of the banking sector, but the financial giant could struggle to move back into the black as emerging markets cool.

Standard Chartered saw Q1 income slump almost a quarter during January-March, to $3.35bn, a result that drove pre-tax profit 59% lower to $589m. And the bank has cautioned that its performance in 2016 will remain “subdued” due to “ongoing challenging market conditions.”

The bank has a long way to go to get revenues in Asia firing again, not to mention put behind it the problem of colossal impairments — Standard Chartered clocked up $471m worth of bad loans during the quarter.

With the firm’s restructuring plan also in its fledgling stages, I reckon it’s far too early to call the ‘bottom’ on StanChart’s troubles.

Crude concerns

The massive supply imbalance hitting the oil market also makes BP (LSE: BP) a poor pick for growth hunters, in my opinion.

Sure, Brent prices may be robust around the $50-per-barrel milestone at present. But many market commentators don’t expect crude values to remain around this level as ample global production keeps inventories at record levels.

Indeed, recent oil price strength could lead to many US producers restarting their idled rigs, putting a cap on any further upside.

BP certainly doesn’t believe the worst is over — the fossil fuel giant’s organic capex budget for 2016 stands at $17bn versus last year’s $18.7bn bill. And this could even topple as low as $15bn in 2017, the business advised in April.

These cutbacks are hardly doing the firm’s long-term growth outlook any favours either, particularly when you also factor-in the billions of dollars worth of asset sales planned for the next few years.

I believe BP is a highly unattractive growth pick at present, particularly as the company currently deals on a massive prospective P/E rating of 27.5 times.

Stuck in a hole

Like BP, I believe that Rio Tinto (LSE: RIO) is also set to toil owing to the heaving oversupply across commodity markets.

The mining giant — like many of its peers — is attempting to mitigate low raw material values by hiking capacity across major sectors. Rio Tinto is ploughing $367m into expanding production at its Pilbara assets in Western Australia, for example, while it’s also increasing output across its copper and aluminium divisions.

But such measures are likely to keep markets swamped in excess material for some time to come, particularly if China’s economic ‘hard landing’ materialises. As such, low commodity prices could be set to reign for much, much longer.

Given Rio Tinto’s murky long-term growth prospects, I reckon a forward P/E rating of 16.7 times is far too expensive.

The post Are these the FTSE 100’s worst growth stocks? appeared first on The Twelfth Magpie.

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Royston Wild has no position in any shares mentioned. The Motley Fool UK has recommended BP and Rio Tinto. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.

Still digging

Raw materials goliath Vedanta Resources (LSE: VED) was recently dealing up over 2% in start-of-week trading after releasing exceptional production numbers.

The company churned out record quantities of copper cathodes, aluminium, silver and electricity between January and March, Vedanta reaping the fruits of improved efficiency, better ore grades and production expansions across its major commodity classes.

Also, Vedanta’s iron ore division finished the quarter with a production run rate of 800,000 tonnes per month, reflecting ongoing expansion work in Goa and the resolution of previous transport issues.

Major producers like Vedanta are hiking volumes to mitigate the impact of subdued commodity prices, of course, and to put higher-cost operators out of business. But such measures are casting a huge pall over future earnings as chronic supply/demand imbalances look set to persist.

The City expects Vedanta to punch losses of 128 US cents per share in the year to March 2016. And the firm is anticipated to remain in the red until fiscal 2018 at the earliest as commodity prices look set to languish. I believe the metals and energy giant is a risk too far at the present time.

Farming faller

The market was much less receptive to Carr’s Group (LSE: CARR) in Monday business, the diversified agricultural business dealing down 4% from Friday’s close at time of writing.

The company announced that pre-tax profit slipped 0.9% during September-February, to £10.5m, the result prompted by a 9.4% revenues decline.

Worryingly, Carr’s Group said “the UK agricultural market has suffered from the depressed farm gate milk and livestock prices and we expect this to continue through 2016 and 2017.”

These issues are expected to push earnings 1% lower in the period to August 2016, according to City forecasts, although a 3% rebound is anticipated for 2017. Sure, these figures produce relatively-low P/E ratings of 11.4 times and 11.1 times, respectively. But I believe today’s worrying market outlook could see brokers take the red pen to these earnings predictions.

Pumping higher

Iodine producer Iofina (LSE: IOF) has emerged as one of Monday’s big winners, the company shooting 89% higher from the end of last week.

Iofina announced that it had produced 124.6 metric tonnes of crystalline iodine between January and March. Although down from 127.9 metric tonnes during the corresponding 2015 period, the company had six of its IOsorb plants running last year compared with five during the last quarter.

Most promisingly, Iofina reaffirmed its target of producing 250-270 metric tonnes of iodine in the first half. And while the firm has seen iodine prices for large users fall below $25 per kilo, Iofina said that it “has seen recent signs of price stabilisation across the global iodine market.”

The City expects Iofina to record further losses in 2016 before bouncing into the black next year. However, 2017’s projection leaves the firm dealing on a P/E rating of 34.6 times. I reckon such a multiple remains far too heady given the still-patchy outlook for iodine values.

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Fresh monetary easing by the People’s Bank of China and the European Central Bank has helped boost demand expectations, while a weakening US dollar has made commodities ‘cheaper’ to purchase, prompting a flurry of buying activity.

This backcloth — along with a generous amounts of short-covering — has helped to propel share prices of the world’s biggest mining and energy companies skywards again. Diversified bruisers Glencore and Anglo American  have both seen their stock values ascend by approximately 60% in the past month alone, for example.

Built to last?

But given the chronic supply/demand imbalances still hanging over the oil and gas segment and many metals markets, I believe recent heady gains have left these firms in danger of a severe price correction.

Indeed, UBS has warned that “the current surge in commodity prices may be a short-term phenomenon,” noting that “for sustainable price upside, we believe the most important factor is an acceleration of demand.”

The broker added that “supply discipline and an end to cost deflation are also important, but we really need a demand shift.”

UBS noted, for example, that Chinese apparent copper demand edged just 2.8% higher in 2015, to 11.5m tonnes due to the country’s shift more towards a services-based economy.

Pockets of opportunity

But that’s not to say the entire commodities segment is a bombed-out mess.

Indeed, there are plenty of resources markets not suffering from the vast supply and demand chasms smacking many metals and energy markets, and these can be played by plunging into the wide world of exchange-traded funds (or ETFs), securities that rise along with the price of the underlying asset.

One such security with strong investment potential is cocoa, in my opinion, the impact of persistent dry weather in the production heartlands of West Africa casting a pall over future supply. The International Cocoa Organization has forecast an 113,000-tonne market deficit for 2015/2016 as it estimates global production sinking 1.8%, to 4.154m tonnes.

And those with a bullish take on the agricultural commodity can bet on a rising price by buying into ETFS Cocoa (LSE: COCO), which trades in correlation with the wider cocoa price.

Go short!

Another way to make a mint from the commodity markets is by purchasing a ‘short’ ETF, i.e. one that moves inversely to material prices.

So a sharp correction in the copper price, for example, could pay off handsomely for someone who has ploughed their cash into ETFS Short Copper (LSE: SCOP). And like conventional ETFs, there are plenty of ‘short’ options to choose from.

Traders can select individual commodities to trade against, like ETFS Short Brent Crude (LSE: SBRT) or ETFS Short Silver (LSE: SSIL). And there’s even an option to trade against a basket of commodities — the EFTS Short Industrial Metals (LSE: SIME) inversely tracks the copper, aluminium, zinc and nickel price.

The post Commodity Prices Are Rallying! So What Should You Do? appeared first on The Twelfth Magpie.

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Royston Wild has no position in any shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.