Global markets were mixed overnight, with US markets (S&P 500 -0.05%) virtually flat, as investors digested a day of recovering oil prices, and another 4.4m new jobless claims for the week (bringing the 5-week total to 26.45m). The total job loss over the last 5 weeks is well above the 22m jobs added since the depression.
Also, Gilead's potential Covid-19 treatment has flopped in China on its first clinical trial, which initially had ignited some positive sentiment around a vaccine coming to the market sooner than anticipated.
Despite markets almost finishing the day flat, there is still a heightened level of volatility, and the economic outlook continues to remain uncertain, especially over the near-term.
Lynas Corporation (LYC:ASX)
Lynas Corp soared +16.9% yesterday after the rare earth miner won funding from the US military for a heavy rare earths separation facility in Texas, as part of a push to secure the supply of essential minerals outside of China.
Phase 1 funding provided by the Department of Defence will allow Lynas and Blue Line to complete detailed planning and design work for the construction of the separation facility, in line with Department of Defence milestones.
After which, it revealed that the successful completion of Phase 1 milestones may lead to further contracts for commercial scale production and operation of the separation facility. Though, management warned that this is not guaranteed.
We continue to remain High-risk BUY rated on Lynas.
Members should look out for a full update on Lynas to be released in our weekly report.
Australia & New Zealand Market Movers
The Australian market (ASX 200 -0.1%) was basically flat again on Wednesday, with the market edging down to a two-week low, while a recovery in oil prices was offset by fragile sentiment on the global economy, particularly around corporate earnings season. The energy sector and miners were the best performers due to better commodity pricing. Whilst healthcare, real estate and banking were hardest hit as investors weigh up an uncertain economic outlook.
Australian Pharmaceutical Industries shares declined -10.7% after failing to provide new guidance for the forthcoming year and cutting its interim dividend following a weak first half, which saw the company's earnings fall -6.1%.
The NZ market (NZX 50 +0.3%) was a touch higher yesterday. The retirement sector rose after the Housing Minister confirmed private open homes were able to commence under level 3, while the possibility of relaxed LVR restrictions by banks eases some housing market tension.
Genesis shares were up after trimming its full year earnings slightly by -$5m, but this was enough to keep shareholders happy, keeping its dividend intact. Argosy Property rose +2.6% after reporting full year property revaluation gain of $61.7m, with gains experienced by their industrial and office properties, offset by a decline in value for their big bulk retail properties.
3 Things Markets Will be Watching this Week
- Coronavirus related news-flow remains key in terms of market moves.
- US corporate earnings will be in focus with some big names reporting in the US, including Amazon and Netflix.
- Capital raising announcements by companies are growing as companies ask for cash from investors in this uncertain period.
Have a Great Day,