Market Update & Important Indicators:
U.S. stocks started the week higher as the latest sign of a strong domestic economy overshadowed jitters over the back-and-forth on trade. Though concerns about the pace of growth world-wide have emerged lately, the advance in major indexes followed a big bounce in stocks Friday that came amid dimming worries about Italian politics and an upbeat U.S. employment report. The tech-heavy Nasdaq Composite was on track to close at a fresh record. Markets in Europe, Hong Kong and Japan vaulted higher as well. The Dow Jones Industrial Average was up 0.7% in the last half-hour of trading. The S&P 500 gained 0.4%. The Nasdaq Composite added 0.6%, on track to break its March 12 all-time closing high. Technology heavyweights helped buoy markets, extending a spell of confidence in one of this year's most volatile groups. Over the weekend, the Trump administration showed no sign of backing down from restrictive tariffs in the face of pushback from allies and China. Beijing separately said it wouldn't abide by any agreement to buy more U.S. products without assurances that the U.S. wouldn't go ahead with plans to hit it with tariffs on Chinese imports. The US Gold price declined 0.1% to 1,291.50 US$/oz.
The Stoxx Europe 600 index ended up 0.3% as investors shrugged off concerns about politics in Spain and Italy. Spain's Ibex 35 ended up 1.2%, while Italy's FTSE MIB lost 0.5%, with some analysts pointing to data showing the European Central Bank slowed its Italian government bond purchases last month. Germany's DAX ended up 0.4%, the U.K.'s FTSE 100 added 0.5%, and France's CAC 40 rose 0.1%.
Japan's Nikkei Stock Average notched its biggest advance in six weeks as stocks benefited from a modest decline in the yen over the past two sessions. Investors appeared to largely brush off intensifying trade tensions Monday. Over the weekend, the Trump administration showed no sign of backing down from restrictive tariffs in the face of pushback from allies and China, as finance officials from the Group of Seven leading nations issued a public rebuke of Washington's new steel and aluminium tariffs. Beijing separately said it wouldn't abide by any agreement to buy more U.S. products without assurances that the U.S. wouldn't go ahead with plans to hit it with tariffs on Chinese imports.
Australian stocks started the week well, but the broader market's gains lagged what was seen in many other locales in Asia-Pacific as the region followed up Friday's Wall Street rebound. The S&P/ASX 200 rose 0.6% after having dropped nine of the prior 12 days. Yield plays like telecom and utilities pulled back as bond prices continued to drop. But outside of that, Aussie stocks were broadly higher. Materials stocks modestly outperformed, as did consumer discretionary. And while sector heavyweight CBA jumped 1.4% following its A$700 million settlement of a government lawsuit, the sector only rose an in-line 0.6%. ANZ fell a further 0.2% amid the criminal case involving its 2015 stock sale.
Base metal prices were mostly positive on the London Metal Exchange. The nickel price gained 0.3% to 15,424/t, while aluminium rose 0.4% to 2,320/t. Larger gains were reported in the 3-month copper contract that climbed 1.3% to 6,973/t, and zinc that added 1.4% to 3,144/t. The standout performer was lead which added 2.7% to 2,500/t.
In this issue:
Agrimin (AMN) |Agrimin (AMN): Company Update and Valuation
Market Cap $141m | Current Price $0.90 | Valuation $0.97
AMN has released a PFS for the Lake Mackay project which is in our opinion economically robust. By applying a 50/50 debt equity funding package needed to develop the project we have valued the project at $1.29/sh. and to account for the risk of securing funding and executing the project we have discounted our valuation by 25% and derived a risked price target of $0.97. Based on our price target of $0.97 p/sh. and thanks to recent share price gains over the last 6 months we change our recommendation to a Hold (prev. Spec Buy.)
Paringa Resources (PNL) | Funding gap filled by equity raise | BUY
Market Cap $100m | Current Price $0.22 | target Price $0.80
Paringa Resources (PNL) has raised $30.2m to fill a funding gap for the development of the Poplar Grove coal mine in Kentucky, US. Additional capex was required for a changed approach to coal seam access, weather related delays and a minimum cash balance for debt drawdown. The Company will now be fully funded to initial cashflows in 2019. While this was an unforeseen dilutive event, PNL still offers a compelling discount to our target price with near term coal production, contracted sales from 2018-2022 and strong market dynamics. Argonaut maintains a BUY recommendation with a revised target price of $0.80 (previously $1.50).
Recent Contacts & Presentations:
Bio–Gene Technology (BGT), Walkabout Resources (WKT), Triton Minerals (TON), Calima Energy (CE1), Peel Mining (PEX), Catalyst Metals (CYL), Vault Intelligence (VLT), Doray Minerals (DRM), Nzuri Coppoer (NZC), Bowen Coking Coal (BCB), Phosphagenics Limited (POH) Great Boulder Resources (GBR), Orthocell (OCC), Northern Minerals (NTU), ABM Resources Ltd (ABU), Vital Metals Ltd (VML), Todd River Resources Ltd (TRT), Pacific Energy Ltd (PEA), Carnarvon Petroleum Ltd (CVN), Australian Mines Ltd (AUZ), Australian Finance Group (AFG), Paladin Energy Ltd (PDN), Cooper Energy Ltd (COE), Medibio Ltd (MEB), Botanix Pharmaceuticals Ltd (BOT), Salt Lake Potash Ltd (SO4), Golden Mile Resources Ltd (G88), NTM Gold Ltd (NTM), Ausmex Mining Group Ltd (AMG), Matrix C&E Ltd (MCE), Austal Ltd (ASB), Decmil Group Ltd (DCG), Ventnor Resources Ltd, Ausdrill Ltd (ASL), Alice Queen Ltd (AQX), PNX Metals Ltd (PNX), Alliance Resources Ltd (AGS), Myanmar Metals Ltd (MYL), Primary Gold Ltd (PGO), Sino Gas & Energy Holdings Ltd (SEH)