8 April 2019
Where are we in the Cycle?
Of the five PortfolioDirect cyclical guideposts, two are ‘red’ and three
‘amber’. The cyclical positioning has been classified as ‘downswing’ with
global growth decelerating, a loss of output momentum in China, the largest
national user of metal, and less supportive monetary policy settings than
have prevailed for most of the post-2009 period. More...
Market Directions
Equity prices regained upward momentum with the growth-oriented
information technology, consumer discretionary and materials sectors leading
the way. Markets have been prepared to price companies for growth despite
widespread scepticism - and evidence - of a slowdown in global economic
activity. Metal prices showed a downward bias. Rising oil and iron ore
prices contrasted with sharply weakening coal prices, reflecting some of the
recently mixed influences on markets. The undervaluation of oil
exploration and development companies has grown.
More...
Portfolio Performance and Positioning
April has begun with established producers continuing to perform better
than exploration companies although a wide dispersion in Phase II returns
has persisted as differences in business practices and strategies play a
role in performance outcomes. The portfolio remains positioned to take
advantage of leverage to any improvement in cyclical conditions among
historically low priced exploration companies. No changes have been made to
portfolio models.
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Stock Reviews and Rating Analysis
PortfolioDirect rating reports analyse the quality and risk
attributes of proposed mineral developments. Rating criteria apply to mining and oil and gas stocks at any stage of
development. PortfolioDirect uses a five point rating
scale to measure the risk adjusted quality of proposed mineral developments
or companies.
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The 'Steak or Sizzle' blog provides summary judgements on
the top performing ASX-listed resources stocks.
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