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27 September 2018 07:50 AM
Overseas Market ReportCurrent
Level
PreviousChangeDaily %
Change
Monthly %
Change
Dow Jones Industrial Average26,38526,492-107.00-0.401.29
S&P 5002,9062,916-10.00-0.330.32
NASDAQ7,9908,007-17.00-0.21-0.34
FTSE 100 Index7,5117,5084.000.05-0.87
DAX 3012,38612,37511.000.09-1.22
CAC 40 Index5,5135,47934.000.610.61
Nikkei 225 (Japan)24,03423,94094.000.395.41
HKSE27,81727,499317.001.15-1.61
SSE Composite Index2,8072,78126.000.920.93
S&P/TSX Composite Index16,16916,16010.000.06-1.67
NZ 509,3219,350-29.00-0.311.24
US Volatility (Vix)13
Overseas Market Report

As was widely expected, the US Federal Reserve's Open Market Committee (FOMC) decided by a unanimous decision to raise the target range for the federal funds rate by 0.25% to 2.00-2.25%. Importantly, the FOMC no longer describes the stance of monetary policy as “accommodative”. This suggests the FOMC believes the funds rate is approaching the neutral rate (estimated to be between 2.50-3.00%).

US sharemarkets fell on Wednesday, giving up earlier gains after the FOMC raised interest rates. The Dow Jones index had traded up by 114 points during the session, but comments by Fed Chair Jerome Powell in his press conference signalling that he did not see inflation surprising to the upside, "It's not in our forecasts", sent bond yields lower. Shares of JPMorgan, Bank of America and Citigroup all fell by more than 1%. The Dow Jones index finished lower by almost 107 points or 0.4%. The S&P 500 index fell 0.3% and the Nasdaq index fell 17 points or 0.2%.

Global oil prices fell on Wednesday after a surprise increase in US crude stockpiles. Inventories rose by 1.9 million barrels in the week to September 21, according to the EIA. Analysts had expected a decrease of 1.3 million barrels. Brent crude fell by US53cents or 0.6% to US$81.34 a barrel and the US Nymex price fell by US71 cents or 1.0% to US$71.57 a barrel.

Base metal prices mostly fell on the London Metals Exchange (LME) on Wednesday as the US dollar strengthened. Copper (-0.7%) fell on concerns over the outlook for Chinese demand. But zinc (+1.6%) lifted as LME inventories fell by 5,775 tons.

The gold futures price fell by US$6.00 an ounce or 0.5% to $1,199.10 an ounce. The spot gold price was trading near US$1,194 an ounce in late US trade. Iron ore rose by US20 cents or 0.3% to US$69.00 a tonne.

CommoditiesCurrent
Level
PreviousChangeDaily %
Change
Monthly %
Change
Oil Brent81.3481.87-0.53-0.657.28
Oil - West Texas crude72.1371.570.560.784.73
Gold Spot $/OZ1,196.001,194.002.000.17-1.24
Silver Spot $/OZ14.4014.300.100.37-3.48
Iron Ore64.9064.600.400.543.18
Thermal Coal Newcastle113.70113.700.000.00-3.56
Coking Coal FOB ECP AUS0.000.000.000.000.00
Aluminium ($US/t)2,0442,044-1.00-0.02-1.39
Copper Mar-18 ($US/lb)2.822.82-0.60-0.214.19
Lead ($US/t)1,9691,993-24.00-1.19-4.83
Nickel ($US/t)12,73212,860-129.00-1.00-4.55
Zinc ($US/t)2,5542,51440.001.580.50
Tin ($US/t)18,88018,905-25.00-0.13-0.84
Uranium ($US/lb)27.0028.000.00-0.184.37
Australian Market ReportCurrent
Level
PreviousChangeDaily %
Change
Monthly %
Change
ASX All Ords6,3086,2999.000.14-1.15
S&P/ASX 2006,1926,1866.000.10-1.22
ASX 24 Futures6,164
Australian Market Report

Wednesday 26 September - close. Expectations there will be an interest rate rise in the US has weighed on local banking shares, offsetting gains from energy and materials stocks, which is holding the Australian share market flat. The benchmark S&P/ASX200 index was up 6.4 points, or 0.10 per cent, at 6192.3 points on Wednesday, while the broader All Ordinaries index was 8.6 points, or 0.14 per cent, higher at 6307.7 points.

Ashanti Headlines

Funding Package Secured - Alliance to Pursue ASX Listing

  • $40 million funding package from a consortium of lenders led by Tribeca Investment Partners significantly strengthens balance sheet and is expected to expedite the ASX listing of Alliance Mineral Assets Limited (Alliance):
    • $20 million secured debt facility for Tawana (Tawana Facility)
    • Additional secured $20 million line of credit for Merged Group conditional on Merger completion and Alliance receiving conditional ASX listing approval (Conditional MergeCo Facility)
  • The Conditional MergeCo Facility is expected to facilitate the satisfaction of ASX’s Emphasis of Matter Requirement1, with both Tawana and Alliance remaining committed to facilitating an expeditious ASX listing of Alliance following completion of the Merger.
  • The Tawana Facility will fund the proposed fines lithium and tantalum circuit additions to the existing Dense Media Separation plant (DMS), for which metallurgy and engineering studies are nearing completion. The additions are expected to increase the nominal throughput rate from the current 200tphto 300tph and increase recovery rates.
  • Tawana and Alliance Merger remains on track, with Alliance shareholders overwhelmingly voting in favour of all Merger-related resolutions including adoption of an ASX compliant constitution.
  • Tawana MD Mark Calderwood commented: “Tawana and Alliance have always remained committed to an ASX listing of the Merged Group and the Conditional MergeCo Facility will increase balance sheet liquidity as we ramp up lithium production and advance optimisation of the Mine and the processing facilities. We also believe it paves the way towards an expeditious listing of Alliance on ASX. We have received exceptional support from Tribeca Investment Partners and other investors which is a great endorsement of the Bald Hill Lithium and Tantalum Mine.”
  • A link to the full announcement can be found here
  • Please contact the desk on +61 8 6169 2668 should you wish to discuss further

Cassini Resources Limited: (CZI.ASX, 7.5cps, m.cap A$25.9m with 345.5 SOI, Cash c$5.5m, Base Metals Explorer)

  • A 2,000m RC drilling program has commenced at CZI's wholly owned West Arunta Zinc Project, near the community of Kiwirrkurra in northern WA
  • First ever drill holes to test new sedimentary zinc targets at Janus and Mimas Prospects
  • Recently completed Airborne EM, gravity, magnetics and soil geochemistry datasets have enabled a new geological interpretation to be constructed to assist targeting for the drill program
  • Managing Director, Mr Richard Bevan, commented “This is an exciting time for Cassini shareholders. Our West Musgrave Joint Venture has had several recent successes with new discoveries at Nebo, Babel and Yappsu. The Pre-Feasibility Study is well on track and we look to provide further updates on this shortly. Now we’ve commenced a drill program to look for a new zinc province in one of the last mineral frontiers in Australia. Our strategy is to provide our shareholders exposure to both short-term exploration success and the medium-term development of a nickel copper-cobalt sulphide project, timed perfectly to capture rising battery metal demand. “We look forward to providing results in approximately 6 weeks.”
  • A link to the full announcement can be found here
  • Please contact the desk on +61 8 6169 2668 should you wish to discuss further.


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