Markets Live, Monday January 6 – The Sydney Morning Herald

SummaryGold price spikes to seven-year highBega Cheese shares fall on expected fire damagQantas suspends flights to Canberra, shares fall 3pcLoading Chart…2.26pmCann Group in trading haltCann Group shares have gone into a trading halt after rising from 80¢ to $1.00 this morning, a jump of 23.6 per cent. The spike occurred without any new information being released to the market. The halt has been requested ahead of an update on the Company’s manufacturing process. Cann Group shares reached as high as $2.48 in 2019, before it announced it would slow down construction of its growing facility in Mildura, on which it has already spent $47 million. 1.58pmGold miners make strong gainsNewcrest mining is up 3.2 per cent today to $31.16 and Evolution Mining is up more than 7 per cent to $3.87 as traders get into the rising gold price. Gold is currently at $US1576.6, or $2269.08 per ounce in Australian dollars, according to the gold trading site Kitco. “It is geopolitical risk that is driving it,” says senior investment advisor and Shaw and Partners, Adam Dawes.”Newcrest and Evolution Mining were all belted pretty hard since October, so there is good value to be bought in that.” Newcrest dropped from $37.33 in late September down to $28.20 a couple of weeks ago, and has now shot up again. Evolution was at $4.66 at the start of October and dropped to $3.49 in late December. Mr Dawes also pointed out Northern Star, which is up 1.5 per cent to $12.10, has a share purchase plan in place that allows anyone on the register at December 16 to buy up to $30,000 worth of shares for $9 each. Northern Star has recently bought into the biggest open pit gold mine in Australia. 1.17pmBell Potter forecasts profit growthThe Bell Financial Services Group today said its unaudited pre-tax profit it likely to be $46 million this year, up 30 per cent from 2018. The full year results are released in February.  Shares are flat today at $1.26, but are up from 80¢ a year ago. In February 2019, Bell reported post-tax profit of $24.7 million, a 20 per cent increase on the previous year. The gains were thanks to its Equity Capital Markets division raising $1.7 billion in new equity capital, and completely taking over Third Party Platform Pty Ltd, which operates retail platforms like Bell Direct. 12.53pmCyclone passing by Broome12.43pmASX declines easeThe S&P/ASX 200 is still lower, but has eased from this morning’s lows, currently sitting at 6695.8 points, a decline of 0.6 per cent. The financial sector is down 1.2 per cent, with the big banks down by at least 1 per cent each, and both Commonwealth Bank and NAB down by 1.3 per cent. Insurers are under pressure with QBE down 1.8 per cent to $12.73 and Insurance Australia Group (IAG) down 2.3 per cent to $7.43. Qantas is still lower, likely due to the rising oil price, falling 2.8 per cent to $6.98. And Virgin is down 3.2 per cent to 15¢. 12.03pmAubil’s stockmarket advice for 2020Paul Xiradis, Executive Chairman, Chief Investment Officer and Head of Equities at the $12 billion Ausbil Investment Management fund, says the biggest risks to markets in 2020 are deflation and currency wars in a note written before US-Iran crisis. “Our bottom-up view for 2020 is for some moderate EPS growth, with the year remaining a stock-picker’s year, focusing on high quality companies that benefit from economic growth and a steady but lower AUD,” Mr Xiradis says.Miners will benefit from increasing demand in China and a lower Australian dollar (which increases earnings once converted to the Aussie). “In the last resources boom, which peaked in 2011, mining companies invested large amounts of capex in capacity. Now, these companies have excess capacity and lower capex expense which is translating into higher free cash flows and stronger earnings growth across the sector as the world’s demand for resources continues,” Mr Xiradis explained. He also warned that bond proxies (shares that have predictable and reliable returns, such as infrastructure and property trusts) have run hard since December and ”are now stretched”. He said Ausbil has reduced its position ahead of potential price corrections in the bond proxies. 11.45amGold price soarsThe gold price spiked soon after trading opened in Sydney, jumping from $US1552 per ounce up to $US1585. It has since fallen to around $US1570 per ounce, which is the highest price since early 2013. Gold is a safe-haven asset, which means investors buy it when they fear a rise in threats such as the increasing talk of conflict between the United States and Iran.  With US President Donald Trump threatening to respond to Iran in a ”disproportionate” manner, and talking of 52 targets selected as payback for the 52 hostages taken in 1979, an increasing sense of fear is understandable.11.25amBega Cheese releases a statementBega Cheese says it two facilities in New South Wales have not been directly impacted and remain fully operational. However, the fires have impacted employees and dairy farm suppliers. “We are working closely with our employees, dairy farm suppliers and freight providers to ensure milk can be delivered and processed whilst taking every precaution to ensure the safety of everyone involved,” the company told the ASX this morning. Bega also thanked the local council and Rural Fire Service, and said it would provide more updates as required. However, shares are still under pressure, down 6.7 per cent to a three-week low of $4.03. 11.08amASX still lower, despite gold reaching new highsThe stock market has not rebounded and is still down 0.7 per cent at 6688.1 points for the ASX 200 and at 6811.5 for the All Ords. On the All Ords Cann Group is up 16.8 per cent to 94¢. And on the ASX200 it is gold miners and oil producers which are making the best gains. Saracen Minerals is up 3.2 per cent to $3.57, Evolution Mining is up 3.1 per cent to $3.78, and Newcrest is up 2.9 per cent to $31.06. 10.43amCannPal signs deal with CSIROCannPal Animal Therapeutics says it has global rights to use CSIRO’s MicroMAX technology for the animal health market, with plans to create cannabis oil treatment for pets. Shares are up 26 per cent to 14.5¢ today.  MicroMax is a microencapsulation process that can be used to encapsulate hemp and cannabis oils, which CannPal says can be used to treat inflammation in pets. “Additionally, the formulation contains compounds from the hemp plant which are already approved for use in consumer products, providing CannPal with a path to market for complementary evidence-based product formats without the need for regulatory approval.” Most Viewed in BusinessLoading
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