Liberum upgrades Rio Tinto to 'hold', says bad news priced in

"We upgrade Rio Tinto, as much of the near-term iron price downside risk has been realised (stocking pricing in $90/t iron ore) with the possibility of a seasonal uptick in Q1," the broker said.

"We still struggle to build a sustainable bull case for Rio Tinto from current levels, as iron ore still has further downside risk over the medium term. For now though, the risks appear more balanced - certainly versus BHP."

Liberum noted that Rio shares have underperformed since the company outlined the cost of going ‘green’ at its investor seminar, at $7.5bn between 2022-30.

In a broader note on the mining sector, Liberum said its most preferred stocks are Anglo American, Ferrexpo, Thungela, Shanta Gold and Gemfields. Least preferred are BHP, Centamin and Taseko Mines.