Goldman Sachs bullish on commodities: Aus shares 0.06% higher at noon

Market Reports

by Peter Milios

The US stock market was closed overnight due to the public holiday of Martin Luther King. However, it is a very busy week ahead for the US, with various data outputs set to be released, such as producer-price index inflation and jobless claims data, followed by a speech by Fed Vice Chairwoman Lael Brainard on Thursday.

The S&P/ASX 200 is 0.06 per cent or 4 points higher at 7,392.60 at noon.

Goldman Sachs has stated that commodities have the strongest outlook of any asset class this year, due to a perfect macroeconomic environment and low inventories for almost every key raw material. However, this didn’t help to push the price of coal up, with the fossil fuel hitting a nine-month low. Energy prices cooled across Europe.

In company specific news, shares in JB Hi-Fi (ASX:JBH) increased after reporting that its net profit jumped more than 14 per cent for the six months to December 31. The stock is up 2.06 per cent just after lunch.

The SPI futures are pointing to a rise of 2 points.

Best and worst performers

The best-performing sector is S&P/ASX 200 Health Care, up 1.74 per cent. The worst-performing sector is S&P/ASX 200 Utilities, down 1.20 per cent.

The best-performing large cap is Novonix (ASX:NVX), trading 7.42 per cent higher at $1.955. It is followed by shares in ResMed Inc (ASX:RMD) and JB Hi-Fi (ASX:JBH).

The worst-performing large cap is Sandfire Resources (ASX:SFR), trading 5.18 per cent lower at $5.955. It is followed by shares in Bapcor (ASX:BAP) and Whitehaven Coal (ASX:WHC).

Asian news

Markets in the Asia-Pacific mostly rose as expectations of cooled inflation in the US lifted investor sentiment in the region.

In mainland China, the Shenzhen Component rose 1.58 per cent to close at 11,785.77, leading gains in the wider region. The Shanghai Composite rose 1.01 per cent to 3,227.59 as the nation saw home prices further drop in December. Hong Kong’s Hang Seng index was flat after erasing earlier gains.

Company news

Latin Resources (ASX:LRS) announced that field teams and drilling rigs have arrived on site for the scheduled commencement of the 2023 drilling program at the Company’s 100 per cent owned Salinas Lithium Project. A total of six, small environmental footprint, man portable/ modular diamond drilling rigs capable of drilling to depth of circa 400-450m below surface have arrived on site and have commenced drilling. Latin Resources’ Geology Manager, Tony Greenaway, commented: “2022 was a standout year for our exploration team, culminating in the delivery of the Company’s Maiden JORC Mineral Resource Estimate for the Colina Lithium Deposit in just ten months from starting our first drillhole.” Shares are 8.3 per cent higher at 13 cents.

Impact Minerals (ASX:IPT) has been selected to participate in the BHP Xplor program to help accelerate exploration needed for the energy transition. Impact will receive up to US$500,000 in cash payments from BHP over the next six months and gain access to a network of internal and external experts. Sonia Scarselli, Vice President at BHP Xplor stated, “We are confident that the BHP Xplor program will support the companies chosen to accelerate their concepts and ideas, to help take them to the next level.” Shares are 25 per cent higher at 1 cent.

Many Peaks Gold (ASX:MPG) has entered into a binding agreement to secure an exclusive right to acquire a 100 per cent interest in the Odyssey Rare Earth Elements Project in Canada. In response, MPG’s Executive Chairman Mr Travis Schwertfeger stated, “The opportunity identified by MPG to diversify into the critical minerals sector has been secured as part of the Company’s ongoing business development activity, focused on delivering future growth by generating a pipeline of projects.” Shares are 9.8 per cent higher at 28 cents.

Corazon Mining (ASX:CZN) has announced high grade lithium at their Miriam project in Western Australia. Laboratory analysis has confirmed the presence of the valued commodity, and found high grade values of between 1.01 per cent and 1.85 per cent lithium oxide. Shares are 30 per cent higher at 2.6 cents.

Breaker Resources NL (ASX:BRB) announced the results from an additional 6 deeper diamond drill holes as part of the resource development program beneath the Bombora Discovery at its Lake Roe Gold Project. Five holes targeted the Northern Flats lode structures with every hole delivering substantial (>10 grams x metre) results. Breaker’s CEO, Sam Smith said: “This is exciting stuff for Breaker! These results continue to show how consistent the underground lodes are. Our previous mining studies* have confirmed the Tura lode has what it takes to sustain a meaningful underground production source beneath any future Bombora open pit. The lode continues to expand at depth with the results showing it has further potential to grow.” Shares are 5.2 per cent higher at 34 cents.

Commodities and the dollar

Gold is trading at US$1782.70 an ounce.
Iron ore is 4.9 per cent lower at US$120.75 a tonne.
Iron ore futures are pointing to a 1.4 per cent fall.
One Australian dollar is buying 0.6971 US dollars.

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