BHP Billiton, Anglo American slump after two banks cut ratings

Shares in UK listed mining giants BHP Billiton and Anglo American slumped 2.8% and 3.4% respectively after two investment banks Wednesday downgraded their ratings on both companies.

Credit Suisse and Investec Securities both downgraded BHP Billiton with the former now at 'sell' versus 'hold' while the latter at 'underperform' versus 'neutral'.

Anglo American also got the chop with both investment banks taking their ratings a notch lower - Credit Suisse now rates the stock at 'neutral' versus 'outperform' while Investec has it at 'hold' from 'buy'.

Target price wise, Credit Suisse cut BHP to 1400p from 1850p and Anglo to 1400p from 1600p. Investec lowered BHP target price to 1330p from 1590p and Anglo to 1045p from 1318p.

Both banks made the downgrades in sector notes to clients in which they express concerns about falls in iron ore and coal prices due to structural issues, namely a weaker Chinese economy, together with low cost supply.