Market Update & Important Indicators:
U.S. stock markets were closed Tuesday for Independence Day.
The Stoxx Europe 600 edged down 0.3% whilst U.S. markets were closed for Independence Day. Investors globally have been rotating out of the first half's leading sector in recent sessions and into areas such as banks, which are considered comparatively cheaper and tend to benefit more from a rising interest-rate environment. Europe's banking sector is up 3.5% from a week ago, compared with a 3.2% loss for tech companies over that time. The FTSE 100 and Germany’s DAX both finished down 0.3%, whilst the French CAC 40 dropped 0.4%.
In Asia, markets ended lower with Hong Kong’s Hang Seng Index finishing down 1.5% to close at its lowest level since May. The Shanghai Composite shed 0.4% whilst the Nikkei 225 dropped 0.1%. Technology shares lagged wider bourses in Europe and led declines in Japan and Hong Kong. Technology companies the previous day reverberated overseas as Taiwan's technology subindex dropped 1.1%.
Banks and resources stocks helped drive a broad rally in Australian stocks Tuesday, as the market ended higher after recovering from steep losses in the previous two sessions. Finishing toward the highs of the day, the S&P/ASX 200 jumped 99.3 points, or 1.8%, to close at 5783.8. It was its strongest single-day rise since November. The four biggest banks, which have a heavy weight in the market, collectively added more than 33 points to the index. All industry subindexes advanced. The market held its gains after the Reserve Bank of Australia held rates steady at a record-low 1.5% for an 11th straight meeting and maintained a neutral tone in the accompanying statement. The decision had been expected. Still, some traders had been anticipating that the RBA would adopt at least to some degree the hawkish tone recently set by some of its counterparts abroad. After it failed to do that, the local currency and bond prices fell. For the day, 2.11 billion stocks were traded valued at 5.92 billion Australian dollars (US$4.54 billion), Commonwealth Securities said.
The London Metal Exchange's three-month copper contract lost 0.61% Tuesday to close at $5,892/t. The other base metals finished mostly lower. Lead prices fell 1.6% to 2,279/t, nickel prices fell 2.2% to 9,141/t, tin prices fell 1.1% to 20,240/t, whilst zinc prices fell 0.3% to 2,794/t. Aluminium prices finished the day flat at 1,921/t.
In this Issue:
Peet (PPC) | WA State Government JV for Brabham | BUY
Market Cap $586m | Current Price $1.195 | Valuation $1.40
The WA State Government’s housing project in Brabham will take advantage of proposed transport infrastructure linking the Swan Valley to Perth and provide PPC, as the preferred proponent, with a robust development pipeline through next decade. PPC will establish a wholesale fund with the Perron Group and act as development manager. The Company entered 2H17 in good shape, with a sound balance sheet (recently bolstered by a $50m 51/4 year bond issue) and a well-diversified land bank centered on growth corridors across Australia. We maintain our positive view and buy call.
Recent Contacts & Presentations:
Transerv Energy Ltd (TSV), Emmerson Resources Ltd (ERM), Antipa Minerals Ltd (AZY), Echo Resources Ltd (EAR), Sovereign Metals Ltd (SVM), Calidus Resources Ltd (CAI), Great Boulder Resources Ltd (GBR), Finders Resources Ltd (FND), Bionomics Ltd (BNO), Threat Protect Australia Ltd (TPS), Ramelius Resources Ltd (RMS), Zenith Energy Ltd (ZEN), Blackham Resources Ltd (BLK), Top End Minerals Ltd (TND), Northern Star Resources Ltd (NST), Xanadu Mines Ltd (XAM), Dacian Gold (DCN), Egan Street Resources Ltd (EGA), Alice Queen Ltd (AQX), Paringa Resources Ltd (PNL), AWE Limited (AWE), Saracen Mineral Holdings Ltd (SAR), Red River Resources Ltd (RVR)
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