Good Morning,
Machine gun like this morning...
Tribal Group (TRB) - EMC coverage from October. The suspicions we had two months
ago have proven accurate and they’ve certainly thrown the kitchen sink in…To
quote:
One has a suspicion that the Chief Executive search hasn't gone as
seamlessly as thought. What is the debt position of the company and more so....see
bold (additions from EMC) that should be thought provoking. There are some
positives, we didn't need to highlight the entire announcement. That's Tribal's
third strike on the bases of profits/performance updates and as such the caveat
of caution applies, expect a kitchen sink approach upon appointment.
Its Rights Issue and Move to AIM, Tribal have now made the
statement that so many before them have ignored. Standard Chartered
(STAN) and Lonmin (LMI) both casualties of the same approach, waving a flag for the
Rights Issue? The finances are dire…With that in mind and a whiff of smoke and fire, its time for the market to acknowledge the facts and stick the knife in. So expect averaging
down, running or avoiding…
The Chinese retail sales and industrial output figures were a surprise, with the shift to consumption growing in pace, there’s
time over Christmas to consider the implications for the wider markets. What the implications are for the non-performing loans,
negative equity and the overall indebtedness of the Chinese commodities sector
and associated industries. China’s Premier and Executives know full well the
problems brewing in the mining provinces and the discontent that is brewing.
With Christmas upon us, the rally is likely to be muted as the realities of trading updates and profit warnings increase the anxiety on the visibility in earnings. Albeit, it is the week of celebration and joy, with interest rates being increased in the US on the 16th December. With that China has linked their currency to a broader basket (FT) …but are the rate hikes in the US priced in? The rate cuts and stimulus so far in China appears to be helping the economy, expect more from China post the US interest rate hike.
2016 will present a very different mix of opportunities in
the markets, both in the commodities space and retail. With the FTSE hitting
the 6K target for near Christmas it’s time for a reality check. Oil and Base
Metals will pretty much determine the global markets over the coming weeks…and
going into 2016. M&A should now be considered...essential.
Lonmin (LMI) thank their shareholders… the shareholders are unlikely to be releasing a
similar RNS to the management? With the confirmation from the Public Investment
Corporation of South Africa (PIC) being stuffed with a 29.99% holding. With so
many changes in the PGM space the industry still needs to shut in capacity. LMI’s
efforts will assist but we estimate the sector is over supplied by near 650K
ounces per annum. With the Russian Ruble weakness it’s not likely to reduce
anytime soon.
With the season of goodwill upon us, we wish Crede Capital Group seasonal
tidings. It would appear Crede are also in a festive mood, as AmurMinerals announced today.
Atb Fraser
No comments:
Post a Comment