The latest market news, commentary and strategy by Adrian Rowney
5 Things that Grabbed my Attention
1. SILVER has now corrected about 13% from it’s high back in May. I don’t know when the selling will stop but nothing has changed fundamentally as the market remains in a supply deficit….BUY ETPMAG
2. Trump is pumping BITCOIN hard and if elected he wants to build an official US government strategic reserve of it, starting with the 210,000 BITCOINS already seized by the Department of Justice.
3. Regis (RRL) warned that it’s mining costs could surge up to 20% next FY….Whilst the company is in a strong financial position with $295 mil in cash and bullion on the balance sheet, it needs GOLD prices to rally significantly just to maintain margins. I’m downgrading from a BUY to a HOLD as it’s operation is not nearly as good as I previously thought.
4. Umicore is mothballing it’s $2.7bn EV battery plant it was building in Canada as demand has tanked….The industry is resembling a disaster zone at the moment.
5. Gina Rinehart has bought another 12 million shares in Lynas (LYC) taking her stake to 7.14% of the company…..Gina has definitely been propping up LYC shares which would be trading a fair bit lower as the price of rare earths has taken a big hit.
ASX Market Update
ASX up 68 points to 7989
Viva Energy (VEA) rallied 4.18% after updating the market with it’s first half unaudited results. Overall fuel sales increased by 5.7% but spending in their mega network of SHELL servos dropped a touch as ciggie sales plunged 17%. VEA did complain that punters are getting their hands on cheap, black market durries instead.
Now it’s becoming obvious that EVs have no hope of success in Australia, VEA’s mega network of servos are not going anywhere, thus I anticipate the market will gradually apply a higher valuation to the company. VEA trading on an undemanding forward PE of 11.8 times and a fully franked yield of 5.3% BUY last sale $3.24.
This is what VEA does:
Random Observation
Pay us now or we’ll ruin your life…..
ATO commissioner has been busy of late:
“It’s Black Brewing. I think we need to set another example…”
The Day Ahead
- ASX futures down 58 points
- Bitcoin down 1% to $67,416
- BHP in US down 0.9%
- Newmont in US up 0.62%
- URNM in US down 2.55%
Movements affecting our resource stocks today (USD)
- Gold down 0.19% to $2376
- Paper Silver down 0.46% to $27.89
- Platinum up 1.72% to $960
- Palladium up 0.29% to $889
- Copper down 0.92% to $4.08
- Brent Crude down 1.75% to $79.71
- Iron ore FLAT @ $102.21
Asian Market Update
Japan up 2.13%, China FLAT, Hong Kong added 1.28%
Large cap Chinese tech stocks are so cheap VS US ones…..Betashares ASIA Technology Tigers ETF (ASIA) is a BUY.
Global Market Update
US Market
DOW down 49 points to 40,539
McDonald’s shares rallied 4% after management said it was working on offering more cheap menu items….By the sounds of it, they must have done a deal with a cardboard recycler because that’s about the best you are going get!
European Markets
Germans down 0.53%, Brits FLAT and French Perverts off 0.98%
Heineken shares fell 10% after reporting a net loss due to it’s disastrous investment in Chinese brewer CR Beer – it wrote down it’s value by $949 mil….Yet another example of a western company getting skunked in China. When will they learn!?!?
Key Market Summary
