That Was The Week That Was … In Australia

By Our Man in Oz

Minews. Good morning Australia. Last week’s strong profit result from Rio Tinto seems have woken your mining market with a jolt on Friday.

Oz. It certainly did, though the reaction to Rio Tinto’s generous treatment of shareholders was largely confined to it and fellow big boy, BHP Billiton.

Without Rio Tinto rocketing up by 6.5 per cent on Friday, and BHP Billiton not far behind with a 4.8 per cent rise, there’s little doubt that we would now be talking about a fall in the key market indices rather than a modest rise.

Minews. Meaning the good news at the top did not filter down.

Oz. Exactly. Last week was very much a time for investment-yield hunters chasing a slice of the fat rewards flowing from the big miners.

The numbers which demonstrate the point are a one per cent rise last week in the all ordinaries index, a two per cent rise on the mining index and a 1.8 per cent fall in the gold index.

Minews. Well short of the Friday moves by the big two. What else was making news in your part of the world?

Oz. You mean apart from the start of the cricket World Cup and the near-death experience of our Prime Minister, Tony Abbott, at the hands of his own party.

Minews. Well, interesting as those events might be, let’s stick to the stock market, starting with any news-making moves, up or down.

Oz. Before prices it’s important for readers to consider the powerful effect currency values and interest rate settings are having on the market down this way.

The dollar drifted down another US1 cent last week, taking its fall over the past five weeks to US5 cents, a very neat US1 cent a week, which is boosting confidence in all exporters selling goods in U.S. dollars and that includes gold, nickel and copper miners.

Interest rates are also ratcheting down with another cut expected next month, though our rates remain miles above those in Europe and the U.S. so there might be a long way to fall in a process which could turn attention to solid dividend payers among the smaller miners.

Minews. Prices now, please.

Oz. Three of the more interesting moves last week came from very different sectors.

Alkane (ALK), the gold miner and rare earth project developer, caught the eye of investors with a rise of A5.5 cents (18 per cent) to A36 cents. Talga (TLG), a graphite developer, added A6 cents (also 18 per cent) to A39 cents, and Whitehaven (WHC), a coal miner, put on A19 cents (13 per cent) to A1.62.

Minews. We might take a closer look at Alkane next week, though in general the moves mention are not what you might call outstanding.

Let’s get on with the rest of the market, starting with gold, please.

Oz. Gold stocks were remarkably flat really, with Medusa (MML) one of the better movers, but that was with a modest rise of A3.5 cents to A88 cents. Other moves included: Regis (RRL), up A6 cents to A$1.99, Chalice (CHN), up A1 cent to A13.5 cents, Troy (TRY), down A1.5 cents to A58.5 cents, and Northern Star (NST), down A1 cent to A$1.97.

Minews. Very dull indeed. Over to the iron ore sector next, please.

Oz. More of the same unfortunately with most moves a few cents either way, including: BC Iron (BCI), up A1 cent to A58.5 cents, Fortescue (FMG), up A5 cents to A$2.59, Mt Gibson (MGX), up half-a-cent to A22.5 cents, while Atlas (AGO) proved the point about a week of minimal movement, with a steady opening and closing price at A19.5 cents.

Minews. Let’s plough on, and move across to the base metals.

Oz. There was a bit of movement among the copper and nickel stocks though it was mainly down. Zinc stocks barely moved.

OZ Minerals (OZL) posted the heaviest fall among the copper stocks as its new chief executive shuffles the company’s assets. It lost A31 cents to A$3.81. Sandfire (SFR) shed A12 cents to A$4.54, and Hot Chili (HCH) was A1 cent weaker at A12 cents.

Sirius (SIR) was the best of the nickel stocks with a rise of A9 cents to A$3.19. Other moves were small, and mainly down. Western Areas (WSA) slipped A15 cents lower to A$4.34 and Mincor (MCR) lost A1.5 cents to A73 cents.

Mungana (MUX) was the best of the zinc stocks with a rise of A1.2 cents to A10 cents. KBL (KBL) shed half-a-cent to A2.1 cents, while Ironbark (IBG) added two-tenths of a cent to A9.9 cents.

Minews. Uranium, coal and graphite next, please.

Oz. Most uranium stocks were flat or lower despite the latest increase in the price of the nuclear fuel. Greenland (GGG) lost three-tenths of a cent to A6.5 cents. Berkeley (BKY) was A1 cent weaker at A22 cents, and Paladin eased back by half-a-cent to A36.5 cents.

Whitehaven, mentioned earlier, was the pick of the coal sector. Other moves were a few cents either way. New Hope (NHC) lost A3 cents to A$2.37, while Atrum (ATU) came back to life with a strong rise of A11 cents to A$1.26.

After Talga the best of the graphite stocks was Syrah (SYR) which added A42 cents to A$4.25. Most other graphite moves were down. Bora Bora (BBR) was A3 cents weaker at A21 cents, and Valence (VXL) slipped A2.5 cents lower to A39.5 cents.

Minews. Minor metals to close, please.

Oz. Alkane, mentioned earlier, was the pick of the minor metal stocks but its move was probably gold related as much as a reaction to positive developments at its rare earth project.

Highfield (HFR) was the best of a mixed fertiliser sector with a rise of A4.5 cents to A86 cents. South Boulder (STB) went the other way with a fall of A2 cents to A20.5 cents.

Base (BSE) continued to lead a weak titanium sector, shedding another A2 cents to A12.5 cents.

Wolf (WLF), the emerging tungsten miner, was steady at A26 cents.

Minews. Thanks Oz.