Afternoon Report / Resources do the heavy lifting (GXY, BPT)

By Market Matters 12 January 18

Resources do the heavy lifting (GXY, BPT)

Market Matters Afternoon Report 12th January 2018

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 

Reports and other documents published on this website and email (‘Reports’) are authored by Market Matters and the reports represent the views of Market Matters. The MarketMatters Report is based on technical analysis of companies, commodities and the market in general. Technical analysis focuses on interpreting charts and other data to determine what the market sentiment about a particular financial product is, or will be. Unlike fundamental analysis, it does not involve a detailed review of the company’s financial position.

The Reports contain general, as opposed to personal, advice. That means they are prepared for multiple distributions without consideration of your investment objectives, financial situation and needs (‘Personal Circumstances’). Accordingly, any advice given is not a recommendation that a particular course of action is suitable for you and the advice is therefore not to be acted on as investment advice. You must assess whether or not any advice is appropriate for your Personal Circumstances before making any investment decisions. You can either make this assessment yourself, or if you require a personal recommendation, you can seek the assistance of a financial advisor.  Market Matters or its author(s) accepts no responsibility for any losses or damages resulting from decisions made from or because of information within this publication. Investing and trading in financial products are always risky, so you should do your own research before buying or selling a financial product.

The Reports are published by Market Matters in good faith based on the facts known to it at the time of their preparation and do not purport to contain all relevant information with respect to the financial products to which they relate. Although the Reports are based on information obtained from sources believed to be reliable, Market Matters does not make any representation or warranty that they are accurate, complete or up to date and Market Matters accepts no obligation to correct or update the information or opinions in the Reports.

If you rely on a Report, you do so at your own risk. Any projections are estimates only and may not be realised in the future. Except to the extent that liability under any law cannot be excluded, Market Matters disclaims liability for all loss or damage arising as a result of any opinion, advice, recommendation, representation or information expressly or impliedly published in or in relation to this report notwithstanding any error or omission including negligence.

To unsubscribe. Click Here