Stock markets declined following a higher-than-expected CPI inflation report. The article analyzes the Fidelity MSCI Materials Index ETF (FMAT), which tracks the Materials sector and carries a Zacks ETF Rank of 4 (Sell). The fund has delivered 7.19% year-to-date returns with a low expense ratio of 0.08%, but faces headwinds from sector weakness and inflation concerns.

Freeport-McMoRan stock declined 3.89% on October 14, 2026, underperforming the S&P 500's 1.11% loss. Despite a 4.38% monthly gain, the company faces a Hold rating with a Zacks Rank of #3. Upcoming Q3 earnings on October 27 are expected to show 50% EPS growth to $0.75 and 1.64% revenue increase to $7.09 billion, though the Mining - Non Ferrous industry ranks in the bottom 33% of sectors.

Southern Copper (SCCO) is expected to report Q3 2026 revenues of $4.50 billion (up 33.3% YoY) and EPS of $2.07 (up 53.3% YoY), driven by higher metal prices offsetting lower production volumes. However, the company faces headwinds from a 3.5% decline in copper production, lower ore grades in Peru, and elevated operating costs. The Zacks model does not predict an earnings beat due to a negative Earnings ESP of -4.35%, despite the company's strong historical track record of beating estimates.

Freeport-McMoRan (FCX) declined 1% on October 8, 2026, underperforming the S&P 500's 0.47% loss. The stock has fallen 5.73% over the past month, significantly lagging the sector. However, the company is expected to report strong Q3 earnings on October 27 with 46% EPS growth year-over-year, and full-year guidance shows 63.84% earnings growth. FCX currently holds a Zacks Rank #3 (Hold) with a Forward P/E of 24.81, trading at a slight discount to its industry average.

The article explains the Zacks Earnings ESP (Expected Surprise Prediction) tool, which identifies stocks likely to beat quarterly earnings estimates by comparing the most recent analyst estimates against consensus estimates. Two Basic Materials stocks highlighted are Freeport-McMoRan (FCX) with a +0.48% ESP and a Hold rating, and Air Products and Chemicals (APD) with a +0.79% ESP and a Buy rating, both showing positive signals for potential earnings surprises.

Freeport-McMoRan (FCX) has attracted significant investor attention recently. While the company shows strong earnings growth (+60.5% for current fiscal year) and has consistently beaten consensus estimates, the stock has underperformed the S&P 500 over the past month (-5.3% vs +1.4%). The company received a Zacks Rank #3 (Hold) rating, suggesting it may perform in line with the broader market in the near term. Valuation metrics indicate the stock is trading at par with peers.

Freeport-McMoRan has demonstrated a strong track record of beating earnings estimates, with an average surprise of 20.32% over the last two quarters. The company currently has a positive Earnings ESP of +6.90% combined with a Zacks Rank #3 (Hold), suggesting another earnings beat is likely in its October 27, 2026 report. Stocks with this combination historically beat consensus estimates nearly 70% of the time.

Freeport-McMoRan and BHP Group, two of the world's largest copper producers, have surged over 36% in 2026, tripling the S&P 500's 12% return. Driven by global copper demand from electrification, EVs, and AI infrastructure, both companies benefit from tight copper supplies and strong financial performance. BHP offers better diversification and a 4% dividend yield, while Freeport provides pure copper exposure with growth potential from leaching technologies.

Freeport-McMoRan (FCX) reported Q3 2026 copper production of 830 million pounds and gold production of 230,000 ounces, broadly in line with expectations. The company continues recovery of its Grasberg Block Cave mine with mill throughput at 67% of normalized rates, targeting 80% capacity by mid-2027. FCX is advancing growth projects including leach initiatives, Bagdad expansion, and El Abra regulatory processes. Stock has outperformed the industry with a 78.7% gain over the past year.

AI industry growth is driving massive demand for copper due to expanding data center infrastructure and electrification needs. S&P Global predicts a surge in copper demand over coming decades, with copper prices already up 36% in the last 12 months. Investors can gain exposure through copper mining stocks, copper miner ETFs, or direct copper commodity ETFs.

AI data center expansion is driving significant demand for raw materials and infrastructure. Freeport-McMoRan, Vulcan Materials, and Vertiv are well-positioned to benefit from multiyear growth in copper, aggregates, and cooling/power solutions as hyperscaler spending continues to surge.

Freeport-McMoRan closed at $70.70, down 1.75%, underperforming the S&P 500's 0.17% loss. The stock has declined 4.99% over the past month, though it outperformed its sector's 8.27% loss. Upcoming earnings are expected to show a 46% EPS increase to $0.73 and revenue of $7.07 billion. The company holds a Zacks Rank #3 (Hold) with a Forward P/E of 25.5 and PEG ratio of 0.7.