Market Update & Important Indicators
U.S. stocks rose Friday alongside expectations that a tax-overhaul plan will pass, likely boosting profits for many U.S. companies. As the odds for passage of a tax overhaul have risen and fallen, so have stocks. U.S. stocks edged slightly lower on Thursday as several Republican senators, including Marco Rubio, expressed last-minute doubts about the plan. On Friday, some changes were made to the bill in what appeared to be last-minute concessions to some dissenters, and stocks jumped higher. The promise of changes to corporate taxes is a high-profile priority for Republicans, and some traders said it seems likely a compromise will pass before the end of the year. A tax cut could add to corporate profits in 2018 and 2019, but might not do much to change the economy, and the most important thing for stocks is that U.S. unemployment and interest rates remain very low. So far this year, stocks have had a remarkable run of gains. On Friday, the blue-chip index rose 143.08 points, or 0.6%, to 24651.74, putting its year-to-date rise at 25%. The Dow notched its 69th record close of the year – the most since 1995. On Friday, the S&P 500 closed up 23.80 points, or 0.9%, at 2675.81. The S&P 500 is now up 20% in 2017, and the index is widely expected to keep rising next year. The U.S. gold price traded slightly higher overnight, gaining 0.2% to close at 1,255.10 US$/oz.
Stocks across Europe ended mostly lower on Friday, as retail and bank shares slumped into negative territory, and yanked the regional benchmark lower for a third straight session. The Stoxx Europe 600 index dropped 0.2% to 388.19, deepening its weekly loss to 0.3%. Last week, it rose 1.4%. On national bourses, France's CAC 40 fell 0.2% to 5,349.30, while Germany's DAX 30 index advanced 0.3% to 13,103.56. In London, the FTSE 100 rose 0.6% to 7,490.57, as the pound tumbled.
Stock markets in Asia were mostly lower Friday after modest declines in the U.S. and Europe Thursday. Japan's Nikkei finished down 0.6%, logging a fourth-straight decline, as the yen firmed against the U.S. dollar. In Hong Kong, locally-listed Chinese financial stocks–which have been among the market's strongest performers this year–continued their recent declines. The Hang Seng was down 1.1%. Shanghai stocks fell 0.8%. South Korea's stock benchmark rebounded after sharp end-of-session losses a day earlier and was up 0.5%.
Australian stocks ended the week on a down note, a day after seeing a 5-day winning streak. The S&P/ASX 200 fell 0.2% to 5997, just enough to allow the index to notch a 4th-straight winning week and 9th in the past 11. Still, it's up just 6% this year. Rio Tinto climbed 1% while BHP was flat and the country's major banks fell some 0.5%.
The London Metal Exchange’s 3-month copper contract traded higher overnight, gaining 1.4% to finish at $6,886/t. The other base metals also finished higher. Aluminium prices rebounded 0.8% to close at 2,051/t, whilst Lead prices gained 2.2% to close at 2,546/t. Zinc prices rose 0.5% to close at 3,205/t, whilst Nickel prices jumped 3.8% to 11,522/t. Tin prices added 1.1% to close at 19,174/t.
In this issue
Sulphate of Potash (SOP) | Getting pumped
Agrimin (AMN) | SPEC BUY | Market Cap $122m
Australian Potash (APC) | Not Covered | Market Cap $27m
Kalium Lakes (KLL) | Not Covered | Market Cap $43m
Reward (RWD) | Not Covered | Market Cap $39m
Salt Lake Potash (SO4) | SPEC BUY | Market Cap $81m
Following significant newsflow in 2017, in this sector update we focus on the hydro model and risk. Models are complex and, given the associated uncertainty, we are increasingly convinced that flexibility to react to a reality that doesn’t match initial expectations is critical. The scale for AMN and progress to date for SO4 continue to impress.
Recent Contacts & Presentations
Greenland Energy Ltd (GGG), Walkabout Resources Ltd (WKT), Marindi Metals Ltd (MZN), Volt Power Group Ltd (VPR), PharmAust Ltd (PAA), Alice Queen Ltd (AQX), Jervois Mining Ltd (JRV), St George Mining Ltd (SGQ), Overland Resources Ltd (OVR), Metro Mining Ltd (MMI), Botanix Pharmaceuticals Ltd (BOT), Xanadu Mines Ltd (XAM), Orthocell Ltd (OCC), Whitebark Energy Ltd (WBE), Atrum Coal Ltd (ATU), Minotaur Exploration Ltd (MEP), Panoramic Resources Ltd (PAN), Sino Gas & Energy Holdings Ltd (SEH), Great Boulder Resources Ltd (GBR), Metallum Ltd (MNE), Gold Road Resources Ltd (GOR), Apollo Consolidated Ltd (AOP), De Grey Mining Ltd (DEG), Triton Minerals Ltd (TON), Evolution Mining Ltd (EVN), Silver Mines Ltd (SVL), NTM Gold Ltd (NTM)