Resources do the heavy lifting (GXY, BPT)
Gains in miners more than offset the weakness in financials today as the index kicked a 2 day losing streak to close higher. Strong leads from the US overnight helped lift the ASX, although the local index underperformed gains seen overseas over a quiet day today. Chinese trade data that hit the screens at 2PM with its trade balance reported 47.81% higher than analyst consensus at $52.2b.
On the market today we saw most selling targeted in the Real Estate sector while the Materials held up in relative terms adding 1.35%. We had an overall range today of +/- 18 points, a high of 6038, a low of 6001 and a close of 6070, up 2pts or +0.04%
ASX 200 Daily Chart
TOP MOVERS
1. Galaxy Resources (GXY) $4.24 / 6.53%; the lithium names have been volatile this week despite lithium moving little. The volatility seems to have stemmed from an AFR article penned yesterday where BlackRock fund manager Evy Hambro was quoted saying he would be “disappointed if they [larger mining companies] went charging in” to the lithium boom at these levels. GXY fell over 10% yesterday after the article was printed, but recovered significantly today. Big miners are cashed up at the moment and are looking for places to spend the money, and clearly investors thought Australia’s listed lithium names could have been on the target list. The article also noted UBS saw the lithium price gradually easing over the next 5 years as new mines come online. Galaxy, Orocobre and Pilbara Mining all rebounded strongly today working to offset some of yesterday’s falls.
Galaxy Resources (GXY) Daily Chart
2. Beach Energy $1.395 / +6.9%; Beach Energy has also been volatile this week, however more so to the upside. A new gas discovery at their Otway Basin, along with strengthening oil prices has help BPT gain 5.68% this week, despite Citi lowering their price target after adjusting oil forecasts. Crude oil hit $US 70 a barrel overnight which lifted the energy names today. We own WPL in both portfolios.
Beach Energy (BPT) Daily Chart
OUR CALLS
No changes to either portfolio today.
Have a great night
James & the Market Matters Team
Disclosure
Market Matters may hold stocks mentioned in this report. Subscribers can view a full list of holdings on the website by clicking here. Positions are updated each Friday, or after the session when positions are traded.
Disclaimer
All figures contained from sources believed to be accurate. Market Matters does not make any representation of warranty as to the accuracy of the figures and disclaims any liability resulting from any inaccuracy. Prices as at 12/01/2018. 5.00PM
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