Freeport-McMoRan Plunges 15%: Tragedy, Tariffs, and the Copper Conundrum Unravel

Summary
• Freeport-McMoRan (FCX) tumbles 15.29% intraday, hitting a 52-week low of $37.815
• Mine disaster in Indonesia halts 35% of 2026 production, triggers $1B insurance claims
• Copper futures surge 3.8% as supply fears offset equity selloff

Freeport-McMoRan’s stock has imploded on news of a catastrophic mud rush at its Grasberg mine, killing two workers and halting operations until 2027. The disaster, coupled with Trump-era tariff exemptions, has sent copper prices surging while FCX’s shares trade at a 27% discount to its 52-week high. With $63.5M in turnover and a 4.45% turnover rate, the selloff reflects both operational and macroeconomic headwinds.

Mine Tragedy and Production Halt Trigger Sharp Selloff
The 15.29% intraday collapse in FCX shares stems from a catastrophic mud rush at its Grasberg Block Cave mine in Indonesia, which killed two workers and trapped five others. The incident damaged critical infrastructure, forcing a full shutdown of the mine—responsible for 35% of Freeport’s 2026 production. The company declared force majeure, citing $1B in insurance coverage (with $700M capped for underground incidents) and a 4% Q3 copper sales cut. Analysts highlight the prolonged recovery timeline (phased restart by mid-2026, full output by 2027) as a major drag on investor sentiment, compounding fears of lost revenue and operational delays.

Copper Sector Volatility as SCCO Rises Amid FCX's Plunge
While Freeport-McMoRan’s shares cratered, the broader copper sector showed mixed signals. Southern Copper (SCCO), the sector leader, rose 7.91% as copper futures climbed 3.8% to $4.82/lb. The divergence reflects SCCO’s exposure to Americas operations, which benefit from higher prices due to Freeport’s supply disruption. However, FCX’s collapse underscores the sector’s vulnerability to operational risks, particularly in politically sensitive regions like Indonesia. Copper’s critical role in clean energy infrastructure and AI-driven demand keeps long-term fundamentals intact, but near-term volatility remains tied to production shocks.

Options and ETFs in a Volatile Play: Navigating FCX's Turbulence
• 200-day MA: $40.06 (below current price) • RSI: 45.16 (neutral) • MACD: 0.518 (bullish) • Bollinger Bands: $43.56–$46.74 (bearish breakout) • 30D Support: $44.84–$44.95

FCX’s technicals suggest a bearish breakout below key support levels. The stock is trading near its 200-day MA and RSI is in neutral territory, but the MACD’s positive divergence hints at short-term buying pressure. The options chain reveals high volatility and liquidity, with two contracts standing out for bearish scenarios:

• FCX20251003P38 (Put): Strike $38, Expiry 10/3, IV 46.44%, Leverage 34.64%, Delta -0.466, Theta -0.0038, Gamma 0.1357, Turnover $35.56M
- High leverage and moderate delta position this put to capitalize on a 5% downside (projected price $36.50), yielding a payoff of $1.50 per contract.
• FCX20251003C40.5 (Call): Strike $40.5, Expiry 10/3, IV 47.82%, Leverage 95.26%, Delta 0.235, Theta -0.0699, Gamma 0.1020, Turnover $34M
- Aggressive call with high leverage for a rebound above $40.50, though theta decay and low delta suggest it’s better suited for a sharp reversal.

Aggressive bears should prioritize FCX20251003P38 for a 5% downside scenario, while bulls may consider a limited long position in FCX20251003C40.5 if the stock breaks above $40.50. Watch for a breakdown below $37.815 (lower Bollinger Band) to confirm bearish momentum.

Backtest Freeport-McMoRan Stock Performance
Below is the interactive report for the requested test of Freeport-McMoRan (FCX) after every intraday plunge of –15 % or worse since 2022. Key auto-completed assumption: because no explicit exit rule was supplied, positions are closed after 20 trading days (a commonly used horizon for short-term mean-reversion studies).Please open the module above to view the full performance statistics, equity curve, and trade list.

Act Now: FCX's Path Diverges as Copper Market Rebalances
Freeport-McMoRan’s 15.29% selloff reflects a perfect storm of operational disaster and macroeconomic uncertainty. While copper prices rally on supply fears, FCX’s recovery hinges on a phased restart by mid-2026 and full output by 2027. Investors should monitor the $37.815 support level and the sector leader Southern Copper (SCCO, +7.91%) for clues on the copper complex’s direction. For FCX, a breakdown below $37.815 could trigger a test of the 52-week low at $27.66, while a rebound above $40.50 may attract short-covering buyers. Act now: Short FCX20251003P38 if $37.815 breaks, or go long SCCO for sector divergence.