Sandvik and Epiroc Shares Fall Over 5% on Slowing Mining Orders
0h ago|4 min readStandard
Fazen Markets Editorial Desk
Collective editorial team · methodology
mining-equipmentindustrial-stocks
Fazen Markets Editorial Desk
Collective editorial team · methodology
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Shares of Swedish mining equipment manufacturers Sandvik AB and Epiroc AB declined significantly on Thursday, July 17, 2026, following reports of slowing order intake. The downturn was attributed to declining precious metal prices that have weighed on mining sector capital expenditure plans since the start of the year. The sell-off occurred amid a broader technology sector decline that saw Meta Platforms Inc. drop 5.18% to $646.01. Bloomberg reported the developments based on industry data and market sources.
Mining equipment manufacturers serve as a leading indicator for resource extraction industries, with order books typically reflecting commodity price movements with a 3-6 month lag. The current pullback in orders follows a 15% decline in gold prices and a 22% drop in silver prices year-to-date through July 15, 2026. The last comparable slowdown in mining equipment orders occurred in Q3 2025 when copper prices fell 18% over three months, triggering a 12% reduction in capital expenditure guidance from major mining firms.
The current macro environment features elevated interest rates, with the Federal Funds target rate at 5.25-5.50% as of July 2026. Higher financing costs have pressured mining companies to defer equipment upgrades and expansion projects. Precious metal price weakness has particularly affected junior mining companies, which rely on higher commodity prices to justify exploration and development spending.
The catalyst chain began with stronger-than-expected inflation data in Q2 2026, which reduced expectations for near-term Federal Reserve rate cuts. This strengthened the US dollar and diminished the appeal of dollar-denominated commodities like gold and silver. As metal prices declined, mining profitability metrics deteriorated, leading to capital expenditure reviews and equipment order delays or cancellations.
Sandvik's stock declined approximately 5.5% during Thursday's session, underperforming the STOXX Europe 600 Industrial Goods & Services index which fell 2.1%. Epiroc shares dropped by a similar magnitude, with both stocks trading at three-month lows. The sell-off occurred on above-average volume, with Sandvik trading at 150% of its 30-day average volume and Epiroc at 140%.
The mining equipment sector's weakness contrasted with the broader equity market performance. The MSCI World Metals & Mining Index declined 3.2% year-to-date through July 17, while the S&P 500 Index gained 8.7% over the same period. This performance divergence highlights the sector-specific nature of the current equipment demand slowdown.
Historical data shows that mining equipment orders typically correlate strongly with metal prices, with a correlation coefficient of 0.85 between gold prices and equipment orders over the past five years. The current precious metal price decline represents the sharpest contraction since January 2025, when gold fell 12% over a six-week period.
Meta Platforms Inc. traded at $646.01 as of 07:02 UTC today, down 5.18% from the previous close. The stock traded between $626.00 and $652.20 during the session, reflecting broad technology sector weakness alongside the industrial equipment sell-off.
The mining equipment slowdown creates negative second-order effects for industrial supply chain companies. Caterpillar Inc. and Komatsu Ltd. typically experience similar order pattern pressures, though their broader equipment diversification provides some insulation. Companies specializing in mining drill bits, crushing equipment, and automation systems face disproportionate exposure to the cycle.
Counterintuitively, equipment rental companies like United Rentals Inc. may benefit as mining operators opt for short-term equipment leases rather than capital-intensive purchases during periods of price uncertainty. This shift toward operational expenditure versus capital expenditure could support rental utilization rates and pricing power.
The primary risk to this analysis is that precious metal prices reverse their decline due to unexpected geopolitical events or central bank buying activity. Central banks purchased a record 1,136 metric tons of gold in 2025, providing underlying support to the gold market despite recent price weakness.
Positioning data indicates hedge funds have been increasing short exposure to mining equipment manufacturers since May 2026, with short interest rising from 2.5% to 4.8% of float for Sandvik. Institutional investors have simultaneously been reducing exposure to broad industrial sectors in favor of technology and healthcare stocks.
The next catalyst for mining equipment demand will be Q2 2026 earnings reports from major mining companies, scheduled for July 25-30. Guidance on capital expenditure budgets for the second half of 2026 will be particularly important for equipment manufacturers. Reduced guidance would likely extend the current equipment order weakness into 2027.
Key technical levels to watch include Sandvik's 200-day moving average at approximately 215 SEK, which provided support during previous sector downturns. A break below this level would signal further downside potential. For precious metals, gold maintaining support above $2,000/oz remains critical for miner profitability and equipment purchasing capacity.
The Federal Open Market Committee meeting on July 29-30 represents another significant catalyst. Any indication of earlier-than-expected rate cuts could weaken the US dollar and support commodity prices, potentially revitalizing mining sector investment enthusiasm. Conversely, a hawkish stance would likely extend the current equipment demand weakness.
Industrial sector ETFs like XLI and VIS contain significant exposure to mining equipment manufacturers and their suppliers. These funds typically decline 1.5-2x the magnitude of individual equipment stocks during sector downturns due to concentrated industrial exposure. The current environment may trigger outflows from sector-specific ETFs as investors reallocate to less cyclical industrial subsectors.
The 2012-2016 mining equipment downturn provides the closest historical comparison, when slowing Chinese demand triggered a 40% decline in equipment orders over four years. The current cycle appears less severe due to stronger balance sheets among major miners and continued demand for copper and lithium for renewable energy applications. The previous cycle bottomed after 18 months of order declines.
Leading manufacturers like Sandvik and Epiroc typically reduce production capacity through temporary layoffs and extended shutdowns during downturns. They also intensify focus on aftermarket parts and services, which provide more stable revenue streams during equipment sales downturns. Digitalization and automation products have become increasingly important revenue sources that are less cyclical than traditional equipment sales.
Mining equipment demand has slowed due to precious metal price declines and tighter capital expenditure budgets.
Disclaimer: This article is for informational purposes only and does not constitute investment advice. CFD trading carries high risk of capital loss.
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