Market Update & Important Indicators
Stock markets around the world tumbled, with the Dow industrials falling to their lows of the year, and government bonds rallied Wednesday as fears about the health of the global economy deepened. Investors have been concerned about softness in Europe, Japan and China for months. And while U.S. growth has remained buoyant, it is unclear whether it can withstand the drag from overseas. Slower economic growth dims the prospects for corporate profit growth, a driver of stock-market gains. The Dow dropped 187 points, or 1.1%, to 17,427 and the S&P 500 lost 12 points, or 0.6%, to 2,011.Worries about slowing global growth whacked stocks in Europe and sent investors into the safety of government bonds, with a fresh slide in copper adding to jitters. Copper has now joined the rout, with prices plunging to their lowest level in more than five years, while oil prices continued to fall, with Brent crude down 0.8% at $47.42 a barrel. The Stoxx Europe 600 closed 1.5% lower, as mining stocks on the index plummeted more than 5%.
Asian government bonds rallied as investors fled to safety, with oil and other commodities posting fresh losses and worries over slowing global growth re-emerging. Stocks in the region were mostly lower, with Japan leading losses. The Nikkei Stock Average fell 1.7%, Indonesia was off by 1.1% and Australia was down 1%. Tokyo was down as the Japanese yen touched its strongest level against the U.S. dollar in more than a month at Yen116.54, from Yen117.92 on Tuesday.
Base metals on the LME all finished in the red, with copper the worst performer, down 5.4%. The bulk of Wednesday's losses occurred during Asian trading hours after the World Bank cited concerns over a "disorderly slowdown" in China and cut its outlook for global growth in 2015. Gold slipped 0.2% to US$1,228.6/oz while WTI crude rebounded 5.6% to US$48.48/bbl. The AUD is buying US$0.815.
Thought for the day
Turning the page
1-Page Limited (ASX:1PG, market cap $77.4m)
1-Page is a human resources technology company that has developed a cloud-based recruitment software platform with a strategy to improve efficiency in the recruitment process. Founded in Silicon Valley in 2011, the initial idea for the platform came about from the book “The One-Page Proposal,” written by 1-Page Chairman, Patrick G. Riley. The Company listed on the ASX last year via a reverse takeover, raising $8.5m which will largely be used for marketing to increase scale.
The Problem: 1-Page believes that the existing manual resume-based recruiting process is time consuming, expensive and ineffective and that there is a significant communication problem between companies and job seekers. There are both quantity and quality issues with traditional resumes, in that companies can be bombarded with an overwhelming number of applicants and also resumes are backward looking, may not be relevant to the role and may be difficult to compare.
The Solution: An “Enterprise Challenge-based Engagement and Assessment Platform”! Essentially what this means is that candidates compete for jobs based on their ability to solve relevant real-time challenges and achieve strategic objectives. Companies can then use predictive data to individually rank and prioritise candidates and select the most suitable to move to the interview stage. The 1-Page platform is applicable to hiring external candidates, internal promotion and open-source innovation.
The Result: 1-Page believes that by streamlining the process and identifying candidates with the greatest capacity and desire for the role, companies will save time, reduce recruiting costs, better identify the most suitable candidates and improve staff retention rates. In summary, it is fast, effective and economical.
How will 1-Page generate revenue? The Company intends to charge customers a monthly service fee in addition to a fee per proposal, depending on the size of the customer’s business. 1PG also aims to grow acquisitively and has already announced the acquisition of BranchOut, a professional networking service, since listing. Current clients already include Orange, Pandora, Omnicom Media, Destinations Hotels and Resorts and Foot Lockers Champs Sports.
In This Issue
Austal (ASB) Initiation | Shipshape
Having long-term contracts and relationships with the U.S. Navy is a good place to be in a world tough on most construction businesses. The pipeline of potential work in the U.S. extends well into the next decade and we believe Austal is very well positioned to win a share of it. With positive trends in margins and free cash flow, and a lower A$ providing a further boost, we expect Austal to deliver earnings growth and resume dividends in FY15.
Argonaut’s Stock Coverage
Recent Contacts & Presentations
Northern Star (NST), Doray Minerals (DRM), Troy Resources (TRY), Gold Road Resources (GOR), Saracen Mineral Holdings Limited (SAR), Beadell Resources Limited (BDR), Resolute Mining Limited (RSG) , RTG Mining (RTG), MACA Limited (MLD), Alexium International Group Limited (AJX), Decmil Group Limited (ACG), Pacific Energy Limited (PEA), Otto Energy Limited (OEL), Peninsula Energy Limited (PEN), Sandfire Resources NL (SFR), Bannerman Resources Limited (BMN).