Morning Notes

01/12/2017 Argonaut Morning Note

Market Update & Important Indicators
Shares of financial firms surged intraday, sending the Dow Jones Industrial Average above 24000 for the first time. The Dow industrials was up more than 300 points in recent trading, its biggest gain since March. Shares of financial firms led major indexes higher, as investors closely watched Republicans' progress on the tax overhaul plan. Analysts say banks are among the stocks that would benefit from the plan's proposed corporate tax cut since they tend to pay a relatively high tax rate. Senate Republicans voted to begin debating the bill Wednesday and a final vote in the Senate could come as early as Thursday night. The Dow industrials gained 308 points, or 1.3%, to 24248 in recent trading. The S&P 500 added 0.8%, while the Nasdaq Composite rose 0.7%. Both the Dow industrials and the S&P 500 are on pace for their eighth consecutive month of gains. The U.S. gold price traded lower overnight, losing 0.7% to close at 1,274.40 US$/oz.

European stocks ended a choppy session on a down note. The pan-European index was supported by broad-based gains in the banking sector, after Credit Suisse Group provided an upbeat outlook and vowed to return a large chunk of profits to investors. Oil companies, however, lost ground as oil prices turned mixed as OPEC agreed to extend output curbs. The Stoxx Europe 600 index fell 1.25 points, or 0.3%, to end at 386.71, contributing to a 2.2% monthly decline for November. Germany's DAX 30 index fell 0.3% to 13,023.98, while France's CAC 40 index dropped 0.5% to 5,372.79. The U.K.'s FTSE 100 index underperformed the broader European markets for a second day, falling 0.9% to 7,326.67.

In Asian trading, a decline in technology stocks continued, as Asian chip shares fell after a setback for U.S. tech shares. The tech-heavy Taiex benchmark in Taiwan fell 1.4%, with Taiwan Semiconductor Manufacturing off 3.6%. In South Korea, the Kospi was down 1.5% amid a 3.4% decline in index heavyweight Samsung Electronics. Hong Kong's Hang Seng Index fell 1.4%, with internet heavyweight Tencent down a further 2.7%. Stocks in Shanghai and Shenzhen were mostly lower with investors unimpressed by a Chinese manufacturing reading for November that came in stronger than expected. Japan's benchmark staged an afternoon rally to rise 0.6%.

Australian shares finished off their session lows, but the stock benchmark still ended November on a down note following Canberra's U-turn on a sweeping parliamentary inquiry into conduct in the financial-services industry. That put the S&P/ASX 200 down 0.7% at 5969.9, cutting the month's gain to 1% after a 4% jump in October. While Westpac and NAB ended little changed, ANZ and CBA lost more than 1%. Commodity stocks were also weak most of the day, though the materials sector for a second month running underpinned the broader market.

The London Metal Exchange’s 3-month copper contract traded slightly higher overnight, adding just 0.03% to finish at $6,762/t. The other base metals finished mixed. Aluminium prices fell 0.9% to 2,034/t, whilst Lead prices bounced 1.8% to close at 2,471/t. Zinc prices were 0.1% lower, closing at 3,177/t, whilst Nickel prices slipped 3.6% further to 11,050/t. Tin prices closed 0.6% higher at 19,690/t.

Recent Contacts & Presentations
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), Gascoyne Resources Ltd (GCY), Southern Cross Electrical Ltd (SXE), MOD Resources Ltd (MOD)

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