Market Update & Important Indicators
U.S. stocks advanced Monday, lifted by gains in health-care and financial shares as well as optimism that Greece will eventually reach a bailout deal with its creditors. The Dow Jones Industrial Average rose 104 points, or 0.6%, to 18,120, while the S&P 500 index added 13 points, or 0.6%, to 2,123.
European stocks and bonds rallied Monday as investors sensed a glimmer of hope that Greece was moving closer to a deal with creditors ahead of an emergency eurozone summit. The German DAX and the French CAC indices both rose a robust 3.8%, while the London FTSE index climbed 1.7%. During the day Athens submitted a last-ditch package of proposals to creditors in a bid to unlock the financing needed to avoid a default. Also on Monday the European Central Bank increased the limit on the amount of emergency loans available to Greek banks to offset daily deposit outflows. It is the third time in less than a week that the ECB has raised the limit.
Hong Kong stocks notched gains on Monday, with the benchmark Hang Seng Index adding 1.2%, while mainland Chinese markets were closed for a public holiday. The benchmark Shanghai Composite sunk 13.3% last week.
Copper was down a marginal 0.1% overnight on the LME, amongst generally weaker prices across base metals. Gold also fell, losing 1.2% to $1,186/oz. In the energy sector, Brent crude gained 0.5% to $63.34/bbl.
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TFS Corporation (TFC) | BUY
TFC has extended its vertical integration strategy through the acquisition of 100% of ViroXis and the 50% of Santalis that it does not already own. Minimum consideration is US$23.4m (mostly paid in TFC scrip) and maximum consideration is contingent on meeting operational and financial targets over time. We like this logical move that locks in the potentially significant upside from the sale of pharmaceutical products that contain Indian Sandalwood Oil (ISO). We maintain our $2.65 valuation (which is yet to capture the dermatological product upside) and buy call.
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Western Areas (WSA), Panoramic Resources (PAN), Northern Star (NST), Regis (RRL), Medusa (MML), Pacific Energy (PEA), Orbital (OEC), Peet (PPC), Alexium (AJX), Austal (ASB), Empired (EPD), Rewardle (RXH), Saracen (SAR), Sino Gas & Energy (SEH), Dacian (DCN), Buru Energy (BRU), Carnarvon Energy (CVN), Otto Energy (OEL), Empire Oil & Gas (EGO), Pura Vida Energy NL (PVD), High Peak Royalties (HPR), Carnarvon Petroleum (CVR)
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