Market Update & Important Indicators
U.S. stocks turned higher Tuesday, reversing their morning declines, as bond markets sold off sharply and Greece's debt standoff continued. U.S. stocks have traded in a close range near record highs in recent weeks, as investors await further clarity on the health of the U.S. economy, as well as the Federal Reserve's timeline for launching interest-rate increases. In the past 30 days, both the Dow and the S&P 500 are virtually flat. Recent data has pointed to a slowdown in the economy in the first several months of the year, leading many investors to push back their time frame for when the Fed will begin rate rises. The Fed's preferred inflation gauge, the personal consumption expenditures price index, rose just 0.1% in April from a year earlier, the Commerce Department said Monday.European stock markets headed south on Tuesday, with developments in Greece the key concern for investors, after international creditors added pressure on Athens to accept a reform plan. The Stoxx Europe 600 index dropped 1% to close at 396.45, falling for the third time in four days. On Monday, the benchmark eked out a 0.2% gain after rumors that a long-awaited deal between Athens and its lenders was imminent. Jobless claims in Germany dropped by 6,000 in May. The decline, however, was less than the 10,000 forecast by economists polled by The Wall Street Journal. In Spain, jobless claims fell sharply in May, the decline the best on record for that month.
Stocks in India sold off Tuesday despite a quarter-point cut in the key repurchase rate by the central bank, while in Japan shares snapped a 12-day winning streak, as exporters and banks were sold off despite advance by the dollar against the yen following a stronger-than-expected U.S. manufacturing report. The Nikkei Stock Average closed down 0.1% at 20543.19. The Nikkei record for unbroken daily rises is 14, set in January 1961. It climbed for 13 straight days in 1988. Bucking losses in the region were China shares, continuing their rebound from one of their worst one-day plunges of the year, suffered last Thursday. The Shanghai Composite Index was up 1.7% at 4910.53, putting it within sight again of the psychologically significant 5000 mark, last reached in January 2008. The index's recent closing high was 4941.71, last Wednesday.
Copper futures closed up on the London Metal Exchange on Tuesday, as the dollar softened against the euro and sterling. Oil prices rose to the highest level of the year Tuesday on a weaker dollar and expectations of a fifth straight weekly decline in U.S. crude supplies. Gold advanced to $1,193/oz. The AUD is buying US$0.777
In This Issue
Metro Mining (MMI) | Spec Buy
Metro Mining (MMI) is developing the Bauxite Hills project in the Cape York Peninsula, QLD, Australia. This bauxite project ticks a lot of boxes with low development capex, high operating margins, long life, low complexity and near term development potential. Bauxite Hills stands to benefit from growing seaborne demand driven by Indonesian and Vietnamese export bans and declining domestic Resources in China. Located close to Rio Tinto’s Weipa project, the project can leverage off the Cape York bauxite brand and has the advantage of being a short distance to China, the target market. Argonaut assigns a SPEC BUY recommendation and $0.25 target price, with a view that MMI offers high margin, low sovereign risk exposure to bauxite.
Recent Contacts & Presentations
Gold Road (GOR), Troy Resources (TRY), Orbital (OEC), Site Group (SIT), Saracen (SAR), Kibaran (KNL), Sino Gas & Energy (SEH), Rewardle (RXH), Alexium (AJX), Ausdrill (ASL), Tox Free (TOX), OBJ Limited (OBJ), Dacian (DCN), Saracen (SAR), Fertoz (FTZ), Atrum (ATU), , Buru Energy (BRU), Carnarvon Energy (CVN), Otto Energy (OEL), Empire Oil & Gas (EGO), Pura Vida Energy NL (PVD), MZI Resources (MZI), High Peak Royalties (HPR), Spookfish (SFI)
Please read Argonaut's Important Disclaimers & disclosures
Log in to the client area below to download the full Morning Note PDF
