Viewpoint: Bullish
BHP has bid $25 for OZL with a higher bid clearly anticipated with the stock trading 6% above the Big Australian’s first salvo, the question we ask (again) today is where does the best risk/reward lie for an Australian copper play:
This morning as copper rallies away from its 2022 lows on diminishing recession fears, we revisit whether OZ Minerals (OZL) or Sandfire Resources (SFR) offers the best risk/reward into Christmas.
US indices rallied strongly overnight compounding Monday night’s gains pressuring shorts as indices enjoyed their best 2-day advance since 2020. Risk assets were helped by soft economic data which provided some optimism that the Fed won’t hike as aggressively as many feared e.g. the US job openings fell to a fresh 14-month low which should ease wage pressures. US 10-year…
The ASX200 was already up over 2% before the much-welcomed news from the RBA which resulted in another 100-points on the upside enabling the market to close up +242-points / 3.75%, not surprisingly its best day in over 2 years.
Gold rallied over 2% overnight as bond yields and the $US slipped lower in tandem, if we are correct and these moves will follow through over the coming months the backdrop for gold is bullish.
US stocks have started this week on the front foot after suffering their worst September in 20-years as bond yields started to pullback after weak US manufacturing data reduced concerns that the Fed would tighten rates too hard, too fast. Under the hood it appeared like exhaustion had confronted the sellers with over 97% of stocks rallying as the market delivered investors their best day since July – this ties in with our view that with a market so bearish there will be few sellers left to weigh on the index.
The ASX200 is set to open up around +100-points this morning following a strong session on Wall Street which saw the Dow rally over 7500-points. Yesterday’s dip by local stocks which tested this year’s 6400 lows may have been the final washout which would be ironic as it occurred on a Public Holiday for most of Australia but either way MM believes the market is looking for / has found a low and we will be higher into Christmas.
SFR -0.53%: the copper miner announced the CEO was stepping down, coupled with a production upgrade as they approach eh end of their first quarter. After 15 years in charge, Karl Simich will leave the company, replaced by the COO while a global search gets underway. The company bumped up full-year copper production guidance by 2.5%, setting themselves up for…
Global student placement business IDP’s recent acquisition of Intake Education is helping accelerate the company’s expansion into Africa which should offer the next chapter of growth following South-East Asia, China and India. We like the business’s growth profile as the world moves on from Covid although some guidance would have been nice from…
WOR was one of their picks for exposure to the energy super-cycle being a major beneficiary in the development of infrastructure that will underpin our move into renewables – we all know how big a task this will be. The company’s FY22 result was strong with underlying EBITDA growth of 18% to $547mn, also they reiterated their intention to invest A$100mn over the next 3-years to support its sustainability growth agenda.
