Market Update & Important Indicators:
U.S. stocks rose Wednesday, while U.S. crude-oil prices surged toward $50 a barrel. Energy shares led gains in the S&P 500 along with financials, which have been rebounding lately. Major U.S. indexes fell in the previous two sessions as investors sold some of this year's best-performing shares, including income-generating investments. Telecommunications, real-estate and consumer-staples companies all fell Wednesday. The real-estate sector, which was split off from financials in the S&P 500 last month, has lost about 5% so far this week. Many investors expect the Federal Reserve to raise rates by the end of the year, and some U.S. economic data have bolstered that view lately. On Wednesday, a gauge of U.S. service-sector activity rose to its highest level since October 2015. The Institute for Supply Management said its nonmanufacturing index jumped to 57.1 in September from 51.4 in August. Earlier this week, ISM's manufacturing index showed a return to growth in September.
European shares fell after six straight sessions of gains, with real estate and utilities companies among the worst performers. London's FTSE 100 index fell 0.6% a day after it came close to a record, as its exporters benefited from a slump in the British pound. The pound touched a fresh multi-decade low against the dollar earlier in Wednesday's session.
Asian shares had a mixed session on Wednesday amid renewed investor concerns the U.S. Federal Reserve would raise interest rates by the year's end. In Hong Kong, the Hang Seng Index reversed early losses and ended up 0.4%, buoyed by energy stocks as oil prices rose. Markets in mainland China remained closed for the week. Still, with the Chinese holiday, market volumes in Hong Kong were light, totalling 52.34 billion Hong Kong dollars ($6.75 billion), down sharply from last week's average daily volume of HK$64 billion. Reduced volumes tend to exaggerate share movements. Weakness in other Asian markets followed comments overnight by a Fed official stating that the central bank should pre-emptively raise short-term interest rates to stave off accelerating inflation. In Japan, however, investors appeared to brush aside the tapering concerns, with the Nikkei Stock Average closing up 0.5%. Japanese financial stocks rose, too, with expectations that higher interest rates would boost yields.
Australian shares pulled back from more than five-week highs Wednesday, tracking global markets as investors again ponder a rate increase from the U.S. Federal Reserve later this year. Financial stocks were one of the few positive sectors amid broad losses. After gains in the previous two sessions, the S&P/ASX 200 fell 31.1 points, or 0.6%, to 5452.9. Comments overnight by Federal Reserve Bank of Richmond President Jeffrey Lacker that the Fed should pre-emptively raise short-term interest rates to stave off accelerating inflation helped boost the U.S. dollar, and spurred weakness in gold prices and Asian stocks.
Meanwhile, nickel prices extended a swift drop Tuesday to trade at a two-week low Wednesday, on signs that the Philippine government could postpone closures of 12 nickel mines following an environmental review. On the London Metal Exchange, copper for delivery in three months was down 0.1% at $4,7800/t. Aluminium was up 0.3% at $1,668/t, zinc was down 1.9% at $2,333/t, lead was down 1.4% at $2,036/t, tin was up 0.1% at $19,988/t and nickel was flat at $10,031/t.
In this Issue:
Independence Group (IGO) | Consolidating the Fraser Range | HOLD
Market Cap $2,323m | Current Price $3.92 | Target Price $3.75
Independence Group (IGO) has announced the intended acquisition of all outstanding shares of Windward Resources (WIN) for a total cash offer of $0.19/sh. This represents 46% premium to the last trading price and a 60% premium to the 5 day VWAP, for a total acquisition cost of $20.5m. WIN has a 70% interest (30% Creasy Group under Ponton Resources) in 1,700km2 of the Albany Fraser Mobile Belt, with the tenement directly south IGO’s Nova nickel/copper.
Recent Contacts & Presentations:
Breaker Resources NL (BRB), Bard1 Life Sciences Ltd (BD1), Alto Metals Ltd (AME), Birimian Limited (BGS), Antipa Minerals Ltd (AZY), Vault Intelligence Ltd (VLT), Noxopharm Ltd (NOX), Gage Roads Brewing Co. (GRB), West African Resources (WAF), Cedar Woods Properties Ltd (CWP), Sino Gas & Energy Holdings Ltd (SEH), Salt Lake Potash Ltd (SO4), Kalina Power Ltd (KPO), Austal Limited (ASB), Agrimin Ltd (AMN), Stavely Minerals Ltd (SVY), MGC Pharmaceuticals Ltd (MXC), Vital Metals Ltd (VML), Tox Free Solutions Ltd (TOX), Swick Mining Services Ltd (SWK), Davenport Resources Ltd (DAV), Orthocell Ltd (OCC), BC Iron Limited (BCI), ALT Resources Ltd (ARS)
Please read Argonaut's Important Disclaimers & disclosures