Market Update

General - This resources world looks wonderful - Mineral Resources

Good afternoon

as expected, Yellen did it...and she increased the growth forecast for 2018 from 2.1% to 2.5%. Yet, she expressed doubt, whether the tax-laws in the US will stimulate the economy also in the longer term. That was the ebst possible outcome for resources, I guess: Good growth coming, but not that good - so interest rates can stay at historically low levels. I guess this, yesterday´s positive reports on commodities by UBS and Goldmans, as well as today´s positive note from Macquarie on EV´s, helped fuel the mood!

Again in the US today: good jobless numbers / strong retail sales / stron manufacturing! What else does the resources market need to rocket???

Draghi did just about the same as Yellen - yes, the economy is doing much better, but we have no plans to change policy! I reckon it´s crazy, but it´s good for our investments! This world is doing everything to make the wealthy welthier!!

PMI in Europe very strong, pointing to the best growth from manufacturing in 7 years.

Car sales in Europe very strong.

Macquarie points to very strong sales of EV´s in Europe and China especially, but slightly weaker than expected earlier in the States - mainly because of Tesla´s production problems. Year on year growth worldwide of 54% so far, much better than expected. Question mark behind China for 2018, as subsidies will be cut - details to be announced. Macquarie has increased it´s market share forecast for EV´s modestly for the next few years.

I think there is not much standing in the way for a nice year coming up for resources...the world is growing- while forecasts are still being increased -, monetary ploicy still helpful, and EV´s growing very strongly - and I guess the US$ not going up at least. Could be fun in store for us in 2018!

The A$ has been very strong today...super-strong labor market numbers in Australia today, and the enxt move in interest rates will be up - probably by mid next year!

All of the above supported a nice move in resources stocks across the board today, despite the strong A$.

Sibanye making another bid - this time for Lonmin! This guy is either destined for complete desaster, or will come out as a big winner...not for the fainthearted!

There was little out today. The only thing catching my imagination was

Mineral Resources - If you have some time, try to listen to their analyst-call over the weekend. This company is very impressive indeed, the MD knows his stuff inside-out, and there is a lot of growth to come over the next few years. In my opinion, the best exposure to lithium you can  4% or better div-yield! He is going downstream lithium, downstream grahpite, taking over gas production to control the cost for this energy hungry business, and will build/operate LNG-plants for other mining companies, which are happy clients already. He also properly explained his sale of some shares the other day - proceeds going to charity. This is a great stock for anyone to hold for the longterm, if you believe in EV´s and resources generally! If Macquarie is right - and I think they might be a little too buliish - MIN`s Div will rise from 73.4ct to 110ct and 162ct ( for 2017/18 - 2018/19 and 2019/20 ).

Have a nice weekend