Overseas Market Report – U.S. Stocks End Little Changed as Oil Falls
U.S. stocks ended little changed on Friday after crude oil futures fell again.
A rally in the technology and consumer discretionary sectors eased a sharp selloff in the materials sector fueled by the drop in oil prices, while a reading on U.S. consumer inflation came in above economists' expectations.
The consumer price index was unchanged in January. Economists had expected a 0.1% decline. Excluding food and energy, consumer prices were up 0.3% in the month. Year over year, inflation was up 1.4% overall while core prices rose 2.2%.
At the close the Dow was down 0.1%, the S&P 500 was unchanged while the NASDAQ was 0.4% higher.
For Australian ADRs listed on the NYSE, BHP Billiton slipped 1 cent (-0.04%) to $23.98, ResMed dropped 30 cents (-0.51%) to $58.90, Telstra Corporation lost 29 cents (-1.50%) to $19.04, Spark New Zealand gained 10 cents (0.93%) to $10.90 and Westpac declined 10 cents (-0.47%) to $21.18.
At 8:00 AM (AEDT), the 10-year Treasury note yield was 1.74% and the 5-year yield was 1.22%.
Deere (DE) cut its full-year earnings outlook. However, the firm's fiscal first-quarter results were ahead of expectations as the firm cut costs in the face of slowing agriculture equipment sales.
Yahoo (YHOO) said it is forming a special committee to explore strategic alternatives. The announcement is a sign the firm is potentially moving forward with the sale of its core internet business while it continues to explore ways to unlock the value of its holdings in Alibaba Group.
European markets were broadly lower on Friday.
The FTSE 100 and French CAC 40 were both off 0.4%, with Germany's DAX down 0.8%.
Asian shares were also lower on the day.
The Shanghai Composite was off 0.1%, the Nikkei 225 fell 1.4%, while the Hang Seng was 0.4% lower. India's Sensex was up 0.3%.
Australian Market Report- Local Market Expected To Open Lower
Ahead of the local open, SPI futures were 1 point lower at 4,919.
Friday 19 February – close. The Australian market tumbled this morning on the back of losses on Wall Street overnight. The negativity continued throughout the day; local stocks traded well below the red line with commodity-related stocks and the major banks weighing the most. There were mixed results from the sectors; health care gained most significantly while energy posted the biggest losses. The Australian dollar depreciated against most major currencies.
The All Ordinaries fell 38.80 points to 5,008.30 while the S&P/ASX 200 lost 39.20 points to 4,952.80.
In This Issue
Argonaut Research| Millennium (MOY) | SPEC BUY
Millennium Minerals (MOY) announced CY16 guidance of 80-85koz @ AISC A$1,180-1,220/oz (91.5koz in CY15), which is above Argonaut’s estimate. The Company continues to progress debt retirement and is now almost debt free (A$2.5m remaining to be paid off by month end). Despite the stock’s recent strong performance, MOY is trading on a competitive normalised EV / FCF of <2.0x (see below). The recently enhanced balance sheet and MOY’s FCF generation enables the Company to undertake a reinvigorated exploration program, with a third rig mobilised to focus on near mine exploration. A successful program would significantly enhance the investment case, particularly if scalable deposits are discovered. Argonaut maintains a SPECULATIVE BUY recommendation.
Santos announced that proved plus probable (2P) petroleum reserves were 945mmboe as at the end of 2015, 24% lower than 2014. The impact of the lower oil price environment combined with asset divestments and 2015 production of 58 mmboe were the key factors in the reduction in booked reserves in 2015. Sales gas proved plus probable reserves decreased by 19% before 2015 production, primarily due to the adoption of lower oil and gas price assumptions and the consequent removal or reclassification of sub-economic projects. GLNG proved reserves increased 15% before 2015 production, while proved plus probable reserves were broadly in-line with the prior year. Contingent resources increased by 8% or 132 mmboe to 1.8bn barrels of oil equivalent. STO slumped 15 cents to $3.39.
Navitas announced that 18% year-over-year growth across its North American partnerships, surpassing its ambitious enrolment goals for the Spring 2016 intake. The Company's most recent partnership, Florida Atlantic University-which exceeded its inaugural enrolment goal by 19% last fall-continued an impressive growth trajectory, up 27% from the previous semester. The Company's partnerships accelerate the internationalization of universities by increasing the quality, quantity and diversity of the International student population. Its proven Pathway program model provides the necessary acclimatization that international students require, thereby ensuring their academic readiness for university-level study. NVT dropped 7 cents to $4.77.
Recent Contacts & Presentations
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