Morning Notes

03/10/2017 Argonaut Morning Note

Market Update & Important Indicators
Major U.S. stock indexes were poised to clinch new records, as fresh economic data bolstered investors' beliefs in a resilient U.S. economy. Eight of the 11 major S&P 500 sectors were higher in recent trading, with shares of manufacturers and financial firms posting solid gains. The Dow Jones Industrial Average rose 130 points, or 0.6%, to 22534 in recent trading, while the S&P 500 added 0.3%. The Nasdaq Composite gained 0.2%. All three indexes were recently trading above their closing highs. A recent stream of economic data has portrayed a durable and growing U.S. economy, helping investors brush off a range of geopolitical risks this year. The S&P rose 4% last quarter - its eighth consecutive quarter of gains. Still, some investors remained wary of the market's ongoing grind higher. Trading activity has been lighter than usual over the past month, and with little risk currently priced in to the market according to the Volatility Index. The U.S. gold price traded lower overnight, losing 0.7% to close at 1,270.50 US$/oz.

European stocks kicked off the week in an upbeat mood on Monday, getting a boost from a weaker euro that tumbled after violent clashes in Catalonia in Spain during the weekend's independence referendum. The Stoxx Europe 600 index rose 0.5% to close at 390.13, rising for an eighth straight session. Spain's IBEX 35 index, however, slumped 1.2% to 10,255.70 for its worst day since mid-August after a chaotic independence referendum in the wealthy north-eastern region of Catalonia in Spain. Banks in Spain were among the biggest losers in Monday's trade.

Asia-Pacific equities were mostly higher Monday, benefiting from gains in the dollar. The WSJ Dollar Index, which tracks the greenback against a basket of 16 currencies, climbed 0.4%. Japan's Nikkei Stock Average added 0.2%. The region's stock markets were also lifted by a robust reading of industrial activity in China issued over the weekend. The nation's September official manufacturing purchasing managers hit its highest level since May 2012. Separately, business confidence in Japan rose to a 10-year high, a central bank survey showed. Markets in China and South Korea will be shut all week, while those in Hong Kong and India were closed for holidays Monday. China's market closures this week could also damp trading in commodity markets and pressure prices, as market participants expect limited demand over the holiday.

Australian Shares notched their strongest day in 8 weeks, outperforming much of the region as big banks and miners shone. Despite state holidays in much of the country, the S&P/ASX 200 settled up 47.7, or 0.8%, at 5729.3. The 4 biggest banks collectively added almost 15 points to the index, led by Commonwealth Bank's 1.5% jump. Among materials stocks, South32 surged 4.9% and BHP and Rio Tinto gained 1.3% and 2.2%, respectively. Beach Energy was among the best performers, soaring 12% as it resumed trading after raising funds to pay for the acquisition of oil and gas assets. The telecom sector was the only one in the red, as Telstra fell 0.9% to retake Friday's recovery.

The London Metal Exchange’s 3-month copper contract traded higher overnight, gaining 0.2% to finish at $6,493/t. The other base metals finished mixed. Nickel prices fell 1.1% to 10,305/t, while aluminium prices rose 0.2% to 2,083/t. Lead prices gained 1.1% to close at 2,519/t, with Zinc prices jumped 2.1% to 3,273/t. Tin prices traded flat at 20,842/t.

Recent Contacts & Presentations
Gage Roads Brewing Ltd (GRB), Otto Energy Ltd (OEL), Whitebark Energy Ltd (WBE), MZI Resources Ltd (MZI), Gascoyne Resources ltd (GCY), NTM Gold Ltd (NTM), Novo Resources Ltd (NVO:TSX), Alice Queen Ltd (AQX), Melbana Energy Ltd (MAY), TOX Free Solutions Ltd (TOX), Artemis Resources Ltd (ARV), Apollo Consolidated Ltd (AOP), Vault Intelligence Ltd (VLT), Fleetwood Corp Ltd (FWD), DTI Group Ltd (DTI), Calima Energy Ltd (CE1), Austal Ltd (ASB), Indoor Skydive Australia (IDZ), OZ Minerals Ltd (OZL), NorWest Energy Ltd (NEW), Berkut Minerals Ltd (BMT), Draig Resources Ltd (DRG), Minotaur Exploration Ltd (MEP), Ausdrill Ltd (ASL), Neometals Ltd (NMT), PNX Metals Ltd (PNX), Northern Minerals Ltd (NTU), New Century Zinc Ltd (NCZ), Metal Bank Ltd (MBK), Rift Valley Resources Ltd (RVY)

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Argonaut Morning Note