Morning Notes

12/02/2018 Argonaut Morning Note

Market Update & Important Indicators
U.S. stocks ended a wild week with gains but suffered their steepest weekly losses in more than two years, with major indexes dropping more than 5% and investors bracing for more volatility ahead. Friday's session was again marked by heightened volatility with the Dow swinging 1,022 points from its high to its low, before surging in the final minutes of the trading session to end the day up 330 points, or 1.4%, to 24191. After spending much of the afternoon in the red, stocks turned higher after the S&P 500 approached a key technical level. Friday's rally followed a weeklong bout of sharp stock swings that left many investors feeling battered. Not only did stocks fall more than 3% on Monday and Thursday, the Dow swung at least 500 points every day during the week, adding to the anxiety. The Dow and S&P 500 formally entered correction territory Thursday--a fall of more than 10% from their highs two weeks ago. The Dow's 5.2% drop for the week marked its steepest decline since January 2016. Meanwhile, the S&P 500 on Friday rose 1.5%, and the Nasdaq Composite added 1.4%. Their losses for the week were 5.2% and 5.1%, respectively. The U.S. gold price traded slightly lower overnight, finishing at 1,315.70 US$/oz.

European shares extended their losses Friday as an upbeat start on Wall Street fizzled out. France's CAC-40 fell 1.4% and Germany's DAX was off 1.2%, while all the region's other major indices were in the red.

On Friday, Chinese stocks posted steep declines, with the Shanghai Composite falling to its lowest since May and ending down 4.1%. Hong Kong's stock benchmarks were also pressured by selling in China as the Hang Seng Index fell 3.1%. The bearish sentiment flowing from U.S. markets was exacerbated by traders looking to book in profits and exit positions ahead of the Lunar New Year holiday at the end of next week. Japan's Nikkei closed down closed down 2.3%, falling 8.1% for the week, the most in two years, as haven flows into the yen also pressured that country's stocks. The yen has risen 1% against the dollar this week.

Australian stocks had their worst week in 2 years even as the market held up better than most any other market in the region today after Wall Street's latest slump. Down as much as 1.8% early, the S&P/ASX settled down 0.9% at 5838. It fell 4.6% for the week. Energy again led today's declines, sliding 2.1% as oil continued its retreat. But gold miners bucked the trend amid modest gains in the precious metal. Elsewhere, Commonwealth Bank fell a 5th-straight day, losing 5.6% in week where its F1H results largely disappointed. But rival NAB ticked higher again as analysts pointed to value in the stock after yesterday's steady F1Q update.

The London Metal Exchange’s 3-month copper contract traded lower overnight, finishing 1.3% lower at $6,755/t. The other base metals finished mostly lower. Aluminium prices dropped 2.5% to $2,121/t, while lead prices gained 0.1% to close at $2,536/t. Zinc prices fell 1.6% to $3,412/t, while Tin prices slid 1.4% to $21,125/t. Nickel prices closed 1.3% lower at $12,933/t.

Recent Contacts & Presentations
Sino Gas & Energy Holdings Ltd (SEH), Australis Oil & Gas Ltd (ATS), Explaurum Ltd (EXU), Whitebark Energy Ltd (WBE), Atrum Coal Ltd (ATU), Melbana Energy Ltd (MAY), Genesis Minerals Ltd (GMD), Proteomics International Laboratories Ltd (PIQ), Ramelius Resources Ltd (RMS), MOD Resources Ltd (MOD), Greenland Minerals & Energy Ltd (GGG), Walkabout Resources Ltd (WKT), 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)

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