Freeport-McMoRan Soars 4.5% on Grasberg Restart Plan Amid Copper Market Turbulence

Summary
• Freeport-McMoRan (FCX) surges 4.5% to $40.76, rebounding from an intraday low of $40.10
• Grasberg mine restart plan announced, targeting 1B lbs copper output by 2026
• Copper prices dip amid regulatory and geopolitical headwinds
• Options chain shows aggressive positioning with 2025-11-28 contracts dominating turnover

Freeport-McMoRan’s stock has surged over 4.5% in volatile trading as the company unveils a phased restart of its Grasberg mine in Indonesia. The move comes amid a turbulent copper market, where supply disruptions and regulatory scrutiny have created a volatile backdrop. With the stock trading near key support levels and options activity intensifying, investors are recalibrating positions ahead of critical production updates.

Grasberg Mine Restart Fuels Optimism
Freeport-McMoRan’s 4.5% intraday rally is directly tied to its announcement of a phased restart of the Grasberg mine following a deadly mud rush incident in September. The company outlined plans to resume large-scale production by Q2 2026, with 2026 output expected to match 2025 levels (1B lbs copper, 900K oz gold). This strategic pivot addresses safety concerns and operational delays, while positioning FCX to capitalize on a potential copper supply deficit. The restart plan also mitigates regulatory risks with Indonesia, which had previously signaled demands for increased equity stakes in the mine.

Copper Sector Volatility Intensifies
The copper sector remains under pressure as global markets grapple with divergent price dynamics. While Freeport-McMoRan’s stock leads the S&P 500, sector peer Rio Tinto (RIO) trades down 0.82%, reflecting broader uncertainty. Copper prices have dipped from record highs amid U.S.-China trade tensions and Trump-era tariff policies, creating a fragmented demand outlook. However, FCX’s operational clarity and production roadmap distinguish it from peers facing regulatory or geopolitical headwinds.

Options and ETFs for a Volatile Copper Market
• 200-day average: 40.257 (near current price); RSI: 41.04 (oversold); MACD: -0.39 (bearish) with histogram: -0.077 (declining bearish momentum)
• Bollinger Bands: Price at 40.76 (near lower band at 38.85); 30D MA: 41.15 (resistance); 200D MA: 40.257 (support)

Freeport-McMoRan’s technicals suggest a short-term bounce from oversold levels, with key resistance at the 30D MA (41.15) and support near the 200D MA (40.25). The RSI at 41.04 indicates potential for a rebound, though the bearish MACD (-0.39) warns of lingering downward pressure. Traders should monitor the 41.15–41.79 resistance cluster and 38.85–40.76 support range for directional clues.

Top Options Picks:
• FCX20251128C40.5 (Call):
- Strike: $40.50; Expiration: 2025-11-28; IV: 45.61%; Leverage: 27.25%; Delta: 0.566; Theta: -0.107; Gamma: 0.121; Turnover: 39,166
- IV (45.61%) suggests moderate volatility expectations; Leverage (27.25%) amplifies gains if the stock breaks above 40.50; Delta (0.566) balances directional exposure; Gamma (0.121) ensures sensitivity to price swings. A 5% upside from $40.76 (to $42.79) would yield a call payoff of $2.29 per share.
• FCX20251128P41 (Put):
- Strike: $41.00; Expiration: 2025-11-28; IV: 52.46%; Leverage: 26.72%; Delta: -0.491; Theta: -0.014; Gamma: 0.107; Turnover: 111,441
- IV (52.46%) reflects elevated volatility; Leverage (26.72%) offers downside protection if the stock dips below 41.00; Delta (-0.491) provides moderate bearish exposure; Gamma (0.107) ensures responsiveness to price declines. A 5% downside (to $38.72) would yield a put payoff of $2.28 per share.

Trading Insight: Aggressive bulls may consider FCX20251128C40.5 into a break above $41.15, while cautious bears might short FCX20251128P41 if the stock fails to hold 40.25. Both contracts offer high liquidity and leverage, aligning with FCX’s volatile near-term outlook.

Backtest Freeport-McMoRan Stock Performance
Below is your event study backtest. It shows how FCX has typically behaved in the 30 trading-days that follow a single-day surge of at least 5 % since 2022.How to read it • Each row gives the average return, win-rate and benchmark for the n-th day after a qualifying surge. • None of the horizons up to 30 days achieved statistical significance; the average 10-day excess return was 0.5 % with a 55 % win-rate. • The pattern shows mild positive drift after the first week but with wide dispersion—results are not strong enough to justify a standalone trading rule.Let me know if you’d like deeper cuts (e.g. different holding windows, adding risk controls, or combining signals).

Positioning for a Copper Market Inflection
Freeport-McMoRan’s 4.5% rally underscores its strategic positioning in a copper market teetering on the edge of a supply deficit. While the Grasberg restart plan addresses operational risks, broader macroeconomic factors—including U.S. tariffs and China’s slowing demand—remain critical variables. Traders should prioritize FCX20251128C40.5 for a bullish breakout above $41.15 or FCX20251128P41 for a defensive play below $40.25. Meanwhile, sector leader Rio Tinto’s -0.82% decline highlights the sector’s fragility. Investors must stay agile, as FCX’s next move could hinge on production updates and copper price dynamics. Watch for $41.15 breakout or $40.25 breakdown to dictate short-term direction.