Morning Notes

07/12/2017 Argonaut Morning Note

Market Update & Important Indicators
This year's stock-market rally continued to stall Wednesday, with major U.S. indexes flipping between slight gains and losses. Some analysts said investors were growing nervous about markets trading near record highs as well as uncertainty about how political developments will impact stocks. The S&P 500 was on track for a fourth straight session of declines, which would be its longest losing streak since March. The S&P 500 fell less than 0.1%. The Dow Jones Industrial Average inched down less than 0.1%, and the Nasdaq Composite added less than 0.1%. A dispute among House Republicans over their year-end strategy forced GOP leaders to delay a vote on a stopgap spending bill Tuesday, just a few days before a partial government shutdown. Some pointed to uncertainty around Republicans' attempt to reconcile the Senate's version of the tax bill with the House's and U.S. President Donald Trump saying the U.S. recognizes Jerusalem as Israel's capital as other sources of investor anxiety. The U.S. gold price traded lower overnight, losing 0.3% to close at 1,262.60 US$/oz.

European stocks finished with modest losses Wednesday, as the region's main benchmark retreated for a second day in a row. The Stoxx Europe 600 fell 0.1% to end at 386.32, adding to Tuesday's fall of 0.2%. But the benchmark is up 0.6% for the week and is showing a 6.9% gain for this year. Germany's DAX 30 index fell 0.4% to close at 12,998.85, while France's CAC 40 gave up less than 0.1% to 5,374.35. The U.K.'s FTSE 100 bucked the negative trend, rising 0.3% to finish at 7,348.03, as a drop in the British pound helped.

The selloff in Asia-Pacific equities deepened Wednesday as falling commodity prices added to the recent setback in tech stocks. Metals prices fell sharply Tuesday after Asian markets closed, sparking fresh concerns about how much China's economy will slow down in 2018 after an unexpectedly strong performance this year. Copper futures in the U.S. fell by the most in nearly three years, and the metal is a key component in manufacturing and production. China, the biggest consumer of copper, has been tightening liquidity in its markets after metals prices hit two-year highs. Japan's Nikkei Stock Average closed down 2%, hurt by a strengthening yen. Taiwan's tech-heavy Taiex benchmark slipped 1.6% in its worst day of 2017 and lowest finish since late September. Hong Kong's Hang Seng Index was down 1.9%, while South Korea's Kospi closed down 1.4% at an eight-week low.

Australian Stocks held up better than regional peers despite the overnight skid in metals prices and 3Q GDP having risen a bit less than many economists expected. The S&P/ASX 200 fell 0.4% to 5946.1, with resources and materials leading the decline. That as industrial-chemicals producer Incitec Pivot fell 1.8% after warning of a financial hit from being dropped as the supplier of ammonium nitrate to BHP. Meanwhile, some retailers which rallied yesterday after what was widely considered a lackluster launch by Amazon in Australia, gave up some of those gains. Bank stocks helped offset some of the weakness seen elsewhere in the local market.

The London Metal Exchange’s 3-month copper contract traded higher overnight, rebounding 0.1% to finish at $6,550/t. The other base metals finished mixed. Aluminium prices lost 1.6% to 2,002/t, whilst Lead prices added 0.3% to close at 2,509/t. Zinc prices fell 1.0%, closing at 3,100/t, whilst Nickel prices dropped 0.5% to 10,749/t. Tin prices closed 0.1% lower at 19,555/t.

Recent Contacts & Presentations
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)

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