Morning Notes

12/10/2017 Argonaut Morning Note

Market Update & Important Indicators
U.S. stocks rose Wednesday, lifted for the second straight day by shares of consumer-staples companies. Robust earnings growth has buoyed major stock indexes this year, even in the face of recent geopolitical risks. Economic data also has been generally positive, with the Federal Reserve recently signaling its confidence that the U.S. economy was strong enough to support further rate increases. Growth in other parts of the world also has given investors confidence. The Dow Jones Industrial Average added 0.1%. The S&P 500 inched up 0.1% and the Nasdaq Composite advanced 0.1%. The consumer-staples sector was among the S&P 500's best performers, gaining 0.3%. Market reaction to minutes from the Fed's latest meeting was muted. The release showed most officials believed at their meeting last month that they would likely raise short-term interest rates again this year, though some said their decision would hinge on whether inflation picks up in coming months. Investors have said the central bank has been effective telegraphing its plans for gradual rate hikes, avoiding shocks to the market. The U.S. gold price continued to gain ground again overnight, rising 0.3% to finish at 1,291.10 US$/oz.

Spanish stocks bounced higher on Wednesday, as worries over the standoff between Catalonia and Madrid eased, after Catalan leader Carles Puigdemont suspended independence plans for now. The IBEX 35 index rallied 1.6% to 10,301.50. The Madrid benchmark was rebounding from a 0.9% loss on Tuesday, when concerns over an escalation in Spain's political crisis blunted the appetite for investing. The pan-European Stoxx Europe 600 index was flat at 390.16. The move is seen as cooling off the political crisis in Spain - considered the worst in four decades - and a step back from a potential split of the country. Spanish Prime Minister Mariano Rajoy will address the issue in a speech to the national parliament later on Wednesday.

Japan's Nikkei Stock Average climbed to a 21-year high Wednesday. The Nikkei ended the trading day up 0.3%, putting it at its highest closing level since 1996. The dollar was recently trading at around Yen112.2, compared with Yen112.67 at yesterday's stock-market close. The Japanese stock benchmark has jumped by around 8% in the past five weeks, rising in the run-up to a snap election set for Oct. 22. Elsewhere in Asia, Hong Kong's Hang Seng was down 0.4% after posting decade highs recently. Taiwan's Taiex closed up 1% after briefly hitting a fresh 27-year intraday high earlier in the day.

Australian shares resumed their march higher, tracking regional gains to settle at an 8-week high. After pausing yesterday, the S&P/ASX 200 managed a 3rd solid gain in the last 4 sessions to end up 0.6% at 5772.1; all sectors ended in positive territory. That includes energy stocks, which rebounded thanks to an overnight bounce in oil prices; Woodside Petroleum rose 1.3%. Metals stocks were muted, as though BHP Billiton gained 0.5% Rio Tinto, Fortescue and South32 each slipped.

The London Metal Exchange’s 3-month copper contract again traded higher overnight, adding 0.6% to finish at $6,800/t. The other base metals finished mostly higher. Aluminium prices lost 1.6% to 2,105/t, whilst tin prices gained 0.7% to 20,990/t. Zinc prices pulled back, falling 1.7% to 3,295/t. Nickel prices traded higher again, firming another 0.7% to finish at 11,061/t. Lead prices also lifted, adding 0.4% to 2,553/t.

Recent Contacts & Presentations
MOD Resources Ltd (MOD), Meteoric Resources NL (MEI), Emmerson Resources Ltd (ERM), Gage Roads Brewing Ltd (GRB), Otto Energy Ltd (OEL), Whitebark Energy Ltd (WBE), MZI Resources Ltd (MZI), Gascoyne Resources ltd (GCY), NTM Gold Ltd (NTM), Novo Resources Ltd (NVO:TSX), Alice Queen Ltd (AQX), Melbana Energy Ltd (MAY), TOX Free Solutions Ltd (TOX), Artemis Resources Ltd (ARV), Apollo Consolidated Ltd (AOP), Vault Intelligence Ltd (VLT), Fleetwood Corp Ltd (FWD), DTI Group Ltd (DTI), Calima Energy Ltd (CE1), Austal Ltd (ASB), Indoor Skydive Australia (IDZ), OZ Minerals Ltd (OZL), NorWest Energy Ltd (NEW), Berkut Minerals Ltd (BMT), Draig Resources Ltd (DRG), Minotaur Exploration Ltd (MEP), Ausdrill Ltd (ASL), Neometals Ltd (NMT), PNX Metals Ltd (PNX)

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