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30 July 2018 08:00 AM
Overseas Market ReportCurrent
Level
PreviousChangeDaily %
Change
Monthly %
Change
Dow Jones Industrial Average25,45125,527-76.00-0.304.86
S&P 5002,8192,837-19.00-0.663.70
NASDAQ7,7377,852-115.00-1.463.02
FTSE 100 Index7,7017,66338.000.500.84
DAX 3012,86012,80951.000.404.51
CAC 40 Index5,5125,48131.000.573.54
Nikkei 225 (Japan)22,71322,587126.000.561.83
HKSE28,80428,78123.000.08-0.52
SSE Composite Index2,8742,882-9.00-0.300.92
S&P/TSX Composite Index16,39416,456-62.00-0.380.71
NZ 508,9818,996-15.00-0.170.42
US Volatility (Vix)13
Overseas Market Report

US sharemarkets fell on Friday with technology weaker after a number of company earnings results failed to meet expectations. After releasing earnings results, shares in Intel fell by 8.6% while Twitter lost 20.5%. But shares in Amazon rose by 0.5% after hitting record highs in the session. The Dow Jones index fell by 76 points or 0.3% with the S&P 500 index down by 0.7% and the Nasdaq index lost almost 115 points or 1.5%. Over the week the Dow rose 1.6%, the S&P 500 rose 0.6% and the Nasdaq lost 1.1%.

Global oil prices fell on Friday as US equity markets fell and the US dollar remained firm. The number of oil rigs in operation in the US rose by three - the first lift in three weeks. Brent crude fell by US25 cents or 0.3% to US$74.29 a barrel and the US Nymex fell by US92 cents or 1.3% to US$68.69 a barrel. Over the week Brent rose by 1.7% while Nymex fell by 2.5%

Base metal prices rose by up to 1.0% on the London Metal Exchange on Friday with zinc up the most. Lead recorded the only decline, down by 0.8%. Over the week copper and nickel rose by 2.5% with tin up 2.4%. But aluminium fell 1.2%.

The gold futures price fell by US$2.70 an ounce or 0.2% to $1,223.00 an ounce. The spot gold price was trading near US$1,223 an ounce in late US trade. Over the week gold fell by US$8.10 or 0.7%. Iron ore rose by US$1.90 or 2.9% to US$67.35 a tonne. Over the week iron ore rose by US$2.55 or 3.9%.

CommoditiesCurrent
Level
PreviousChangeDaily %
Change
Monthly %
Change
Oil Brent74.3174.290.020.03-6.46
Oil - West Texas crude68.9368.690.240.35-7.04
Gold Spot $/OZ1,223.001,223.00-0.50-0.04-2.43
Silver Spot $/OZ15.5015.500.00-0.02-3.87
Iron Ore61.4059.601.702.922.92
Thermal Coal Newcastle115.20115.50-0.30-0.260.70
Coking Coal FOB ECP AUS171.20171.000.200.12-13.62
Aluminium ($US/t)2,0542,0496.000.27-6.04
Copper Mar-18 ($US/lb)2.802.800.100.02-5.03
Lead ($US/t)2,1292,146-17.00-0.79-12.30
Nickel ($US/t)13,77013,67793.000.68-6.98
Zinc ($US/t)2,6562,62828.001.05-9.15
Tin ($US/t)20,04519,96580.000.400.53
Uranium ($US/lb)26.0026.000.000.0013.25
Australian Market ReportCurrent
Level
PreviousChangeDaily %
Change
Monthly %
Change
ASX All Ords6,3916,33854.000.851.62
S&P/ASX 2006,3006,24456.000.891.70
ASX 24 Futures6,220
Australian Market Report

Friday 27 July - close. The Australian share market has closed stronger, with gains almost across the board and miners buoyed by BHP's deal to sell its troublesome US shale oil assets. The benchmark S&P/ASX200 index closed up 55.7 points, or 0.89 per cent, at 6,300.2 points on Friday, while the broader All Ordinaries rose 53.9 points, or 0.85 per cent, to 6,391.5 points.

Ashanti Headlines

Base Resources (BSE.ASX, 29cps, m.cap A$327m with 1.23b SOI, Cash US$29.7m, Mineral Sands Producer)

Late cycle commodity exposure has been sought by a subset of institutional clients of late, we sat down with Managing Director of Base Resources Tim Carstens last week. Below are key points from the recent quarterly along with our takeaways, please call the desk on +61 6169 2688 if you would like to discuss further. 

BSE Quarterly Highlights:

  • Strengthening of rutile and zircon prices
  • Record rutile quarterly production of 24,451t
  • Successful ramp up of Kwale Phase 2 optimisation
  • Net debt reduced by US$27.6m to US$33.2m
  • Production guidance for FY 2019; Rutile: 88-83,000t, Ilmenite: 420-450,000t, Zircon: 32-37,000t

Meeting takeaways

  • Iluka Resources reporting presents continued strength in mineral sands pricing going forward
  • Phase 2 optimisation complete, company will start processing lower grade material next quarter (increased tonnage processed)
  • Company is generating strong cash flows and expects to have debt paid down by end of year
  • Kwale exploration going well creating potential for significant additional mine life
  • Toliara project in Madagascar developing well, targeting decision to mine H2 CY19, production H2 CY21
  • Increased spend at Toliara next quarter with only US$1.5m spent last quarter 
  • Preferred development option for Toliara in Q3 CY18 and full PFS targeted for Q1 CY19. DFS expected Q3 CY19. 
  • Ashanti expects Toliara to surprise on the upside as further information is presented to the market 

Berkeley Energia Ltd: (BKY.ASX, 77cps, m.cap A$196.1m with 254.7m SOI, Cash $100.8m, Uranium Developer)

BKY Quarterly Highlights:

  • Listed on the Main Board of the London Stock Exchange and the Madrid, Barcelona, Bilbao and Valencia Stock Exchanges delivering a higher profile across European markets and access to additional pools of capital
  • Permitting Update - Application for Urbanism Licence and construction works authorization are ongoing. Construction and commissioning phases expected to commence late 2018 and 2019 respectively, subject to receipt of the former.
  • identified potential ~€9 Million of further cost savings reducing initial capex required to bring mine into production through optimisation of plant capacities, outsourcing of peripheral infrastructure and reducing initial throughput for production from the Retortillo deposit
  • Strong support from key stakeholders - The government of Castilla y Leon demonstrated its continued support for the mine in June when it rejected a resolution from opposition groups requesting that the Company’s €250 million investment be halted.
  • Appointment of Mr Sean Wade as Chief Commercial Officer, an experienced corporate executive with a background in mining and emerging markets.
  • Exploration focused on identifying additional targets with similar characteristics to Zona 7 continued during the quarter. The anomalies found in the soil sampling programme carried out during the previous quarter were confirmed and a drill programme targeting the main anomalies is now being designed.
  • A link to the full announcement can be found here
  • Our preferred Uranium exposure on the ASX  / LSE is Berkeley Energia (ASX.BKY). 

Ashanti Capital was co-manager to the pre IPO raising and $10m IPO of Adriatic Metals PLC which is the best performing IPO thus far for CY18 - as outlined in the Sydney Morning Herald article below.

https://www.smh.com.au/money/investing/how-to-make-money-from-sharemarket-floats-20180726-p4ztoy.html

We encourage you to open a trading account with us if you do not have one already as we have a number of exciting investment opportunities coming up. To open an account please contact admin@ashanticapital.com.au

We're always on the lookout to work with new companies with experienced management teams. Please feel free to put us in touch with any corporate contacts who would benefit from our service and expertise.


Have a question? admin@ashanticapital.com.au

ERA Communications