Market Update & Important Indicators
U.S. stocks rose Monday, rebounding from Friday's losses as the dollar weakened against other currencies and European stocks gained. Market participants remain focused on the Federal Reserve, which begins its two-day policy meeting on Tuesday. The Fed statement and Fed Chairwoman Janet Yellen's remarks in the subsequent news conference on Wednesday will be parsed for clues on the timing and pace of the central bank's eventual rate increases. The Dow rose 228 points, or 1.3%, to 17,977 and the S&P 500 advanced 28 points, or 1.4%, to 2,081.
European stocks rallied, with a new milestone for German stocks reflecting the flood of money that's been rushing into the market as the European Central Bank embarks on its massive asset-purchase program. The Stoxx Europe 600 climbed 0.9% to 400.18, the first close above the 400 mark since June 2007. In Frankfurt, K&S AG rallied 4.8%, and Siemens AG tacked on 3.2% after the company over the weekend won a power-plant deal from the Egyptian government. France's CAC 40 rose 1% to 5,061.16. Greece's Athex Composite underperformed, falling 0.9% to 763.08. The Hellenic nation reportedly made a loan repayment to the International Monetary Fund on Monday, but remains in danger of running out of cash at the end of the month.
China shares popped Monday on the prospect of further stimulus measures from Beijing, but the region also saw selling on expectations of an increase in U.S. interest rates. Mainland China shares led gains in Asia, with the Shenzhen and Shanghai indexes up 3.1% and 2.3%, respectively. Stock benchmarks in Thailand and the Philippines were down more than 1%. The Korean won earlier Monday hit a fresh two-year low against the U.S. dollar, extending its most recent leg of weakness since the beginning of the year.
Base metals on the LME were mixed. Tin was the best performer, up 1.4%. Gold lost 0.4% to US$1,154.3/oz and WTI crude fell 2.1% to US$43.88/bbl. The AUD is buying US$0.764.
Thought for the day
Alexium (AJX) | SPEC BUY
Gaining ground in the military sector
Alexium (AJX) has continued to make good progress towards rolling out its flame retardant technology in the US military sector. The Company has taken a two-pronged strategy to introduce its products to the military by:
• Working with the Natick Soldier R,D&E Centre to develop a next generation FR military uniform
• Building relationships with military prime contractors to potentially sell directly into the military pipeline
AJX received a grant through the Batelle Memorial Institute to assist in providing Natick with a commercially-viable 50/50 nylon-cotton FR fabric. The materials have been produced, successfully tested internally and delivered to Natick for independent testing prior to downselection. Concurrently, AJX is working with the largest prime supplier to the military to introduce the technology into existing programs. Prime contractors supply the finished garments to the military and have direct lines of communication to key decision-makers. AJX has also been developing an environmentally-friendly 100% nylon treatment that can be used for military applications including outer tactical vests, tents and parachutes.
Some of the reasons why we believe AJX is well placed for success in the military arena:
Cost effectiveness and other attractive attributes: The technology has a number of advantages that make it an attractive choice for clients. In addition to being environmentally-friendly, the technology is cost effective, lightweight, durable and are able to be laundered. AJX’s chemistries also increase the strength and durability of fabrics they are applied to as opposed to traditional coatings which weaken fabrics.
Eco-friendly technology: While more stringent environmental regulations are hindering AJX’s competitors, this trend is positive for AJX. The Company’s FR coatings are environmentally-friendly and do not contain harmful products such as bromine, chlorine, antimony and heavy metals that are found in competitors’ products. Already, new legislation in Europe and the US severely restricts or prevents the use of some brominated and halogenated compounds and we expect the trend of stricter environmental controls to continue.
Obama signs US Defense Authorisation Act: On 22 December 2014, President Obama signed the 2015 National Defense Authorisation Act (NDAA) which calls on the Secretary of Defense to complete a study on flame resistant technologies and whether these can expand to a wider range of service members. We believe, that with its environmentally-friendly, low cost FR solution and initial contract with the US Army, AJX would be ideally placed to benefit from an expansion to additional personnel.
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