Basic Materials Sector

Comprehensive analysis of the basic materials sector

+3.01%1D Performance
50 Companies
$1.03T Market Cap
Total Companies
50
Total Market Cap
$1.03T
Avg P/E Ratio
26.9
Avg ROE
10.0%
↑ 10.02%

Sector Performance Overview

Performance Metrics

1 Week-3.01%
1 Month-6.36%
3 Months+1.82%
6 Months-3.31%
YTD+2.84%
1 Year-4.01%

Sector Characteristics

Key Industries

Chemicals - SpecialtyIndustrial MaterialsChemicalsGold

Investment Style

CyclicalCommodityValue
No data found for the Basic Materials sector in this country.

Leading Companies by Market Cap

SymbolCompanyPriceChangeMarket CapP/EVolume
LIN.DELinde plc$408↑+0.20%192.06B33.649,612
AIL.DEL'Air Liquide S.A.$182.62↓-0.71%105.31B31.931,329
RIO1.DERio Tinto Group$50.45↓-0.34%85.44B8.1895,520
BASA.DEBASF SE$17.9↑+0.00%63.38B13.08104
NMM.DENewmont Corporation$49.495↑+3.85%55.09B12.9218,924
Showing top 5 companies by market capitalization

Understanding the Basic Materials Sector

The basic materials sector represents a significant segment of the modern economy, encompassing 50 companies with a combined market capitalization of $1.03T. This sector includes key industries such as Chemicals - Specialty, Industrial Materials, Chemicals, each contributing to the sector's overall performance and market dynamics. The sector's diverse composition provides investors with exposure to multiple business models and growth opportunities within the basic materials space.

Investment opportunities in the basic materials sector are characterized by companies with cyclical, commodity, value strategies. The sector's financial profile includes an average P/E ratio of 26.9 and an average ROE of 10.0%, reflecting the fundamental strength and profitability metrics across the sector's constituent companies. Investors should consider these metrics when evaluating investment opportunities and assessing risk-return profiles within this sector.

The basic materials sector's recent performance shows varied results across different time horizons, with 1-day performance at +3.01% and year-to-date performance at +2.84%. This performance data, combined with the sector's fundamental characteristics, provides valuable insights for investors considering portfolio allocation to the basic materials sector. The sector's investment appeal lies in its cyclical, commodity, value nature, offering opportunities for both growth-oriented and income-focused investment strategies.

Frequently Asked Questions

The basic materials sector includes companies involved in chemicals - specialty, industrial materials, chemicals, gold. Major companies include Linde plc, L'Air Liquide S.A., Rio Tinto Group, BASF SE, and Newmont Corporation and many others that drive technological innovation.
The basic materials sector has generally outperformed the broader market over the long term, driven by continuous innovation and digital transformation trends. However, it's also known for higher volatility compared to more traditional sectors, with significant price swings during market cycles.
Key risks include high market volatility, rapid technological obsolescence, intense competition, regulatory challenges, and sensitivity to economic cycles. Additionally, many basic materials companies trade at high valuations, making them vulnerable to market corrections.
Focus on metrics like revenue growth, profit margins, return on equity (sector average: 10.02%), free cash flow, and price-to-earnings ratio (sector average: 26.92). Also consider competitive positioning, intellectual property, management quality, and the company's ability to adapt to technological changes.
The basic materials sector is characterized by cyclical, commodity, value investment styles. This sector offers exposure to companies across various industries including chemicals - specialty, industrial materials, chemicals, gold, providing investors with diversified opportunities within the sector's ecosystem.
The basic materials sector can be excellent for long-term investors who can tolerate volatility and believe in continued technological advancement. The sector's growth potential is driven by ongoing innovation and increasing digitalization across all aspects of business and life.

Explore Other Sectors

Healthcare

Medical devices, pharmaceuticals, biotechnology

Financials Services

Banks, insurance, investment services

Energy

Oil, gas, renewable energy companies

Consumer Cyclical

Retail, automotive, entertainment

Industrials

Manufacturing, aerospace, defense

Technology

Software, hardware, semiconductors