Good Evening,

Welcome to Equity Espresso

We’re here to catch you up on all the day’s news both in Oz and abroad.

Here’s a sample of what you may have missed today:

1. 🔋 Mali Government Halts Lithium Miner

2. 🃏 Sky City Facing 10-Day Timeout

3. ↘️ August’s Bottom 5 Performers

4. 💲 Liontowns Lucrative Deal

5. ✈️ QANTAS Responds

The Recap

Liontown & Leo Lithiums

Day of Contrasts

A positive start to the week, with the ASX200 closing 40.5 points higher to 7,318.8 as investors’ focus will be on tomorrow’s policy meeting at the Reserve Bank and Governor Philip Lowe’s final speech on Thursday. It’s widely tipped that the RBA will keep rates on hold.

The other key data point this week is Q2 GDP. Economists have revised down their forecasts due to weaker company profits, inventories, and household spending data. Goldman Sachs now predicts a gain of only 0.1% from the first quarter, while other major banks such as Westpac, ANZ, CBA, and UBS have also flagged downside risks to their forecasts.

Whilst the ASX200 finished higher, only four sectors ended in the green, with Materials (+1.95%) and Energy (+1.59%) both higher thanks to some optimisation over in Asia. Speaking of, Hong Kong stocks rose today on hopes that China will deliver more stimulus to revive confidence in the market after rolling out new easing measures to support the housing market.

ASX200 Stock Snapshot

Wall Street

U.S. markets ended on a high note last week, breaking a three-week losing streak. This was due to a resurgence in growth stocks after a series of disappointing economic data releases. Investors are hoping the Federal Reserve will end its rate hiking cycle sooner than expected. This week will see a shortened trading period in U.S. markets, as Monday is a public holiday for Labor Day.

Economic News

• The ANZ-Indeed Australian job advertisements index increased by 1.9% in August to reach 146.2 points. Although the ads are 7.7% lower than last year, they are 52.2% higher than the pre-Covid levels in February 2020.

• The U.S. economy added 187,000 jobs in August, beating the expectation of 170,000 and an improvement from July’s 157,000 (revised from 187,000), while the unemployment rate stayed at 3.8%, compared to the forecast of 3.5% and last month’s 3.5%.

Quick Singles

🪃 Local News

• Treasury Wine Estates has announced that CFO Matt Young will leave the position on November 1, with Stuart Boxer being elevated to take over in an expanded Chief Financial and Strategy Office position.

• Tyro Payments has initiated legal action in the Supreme Court of NSW against Kounta. Tyro alleges that Kounta violated their contractual agreement by introducing a rival product, Lightspeed Payments, to Tyro’s clients while still representing Tyro under a contract.

• Qantas says it is reviewing the ACCC allegations that it continued selling tickets for cancelled flights. It stated that its longstanding practice is that customers are offered an alternative flight as close as possible to their original departure time or a refund when a flight is cancelled.

• Webjet plans to buy back up to $250 million of convertible notes that mature in 2026.

🌏 Around The Globe

• UBS made banking history by posting the highest quarterly profit of a bank at $29 billion thanks to the controversial Credit Suisse rescue in March.

• Tesla has shown off its new Model 3. The updates give it a new look in the front, more screen space, and a more extended driving range. The company claims that it replaced more than half the vehicle’s parts.

• Samsung has launched Samsung Food: a meal planning and recipe platform available in 104 countries, offering over 160,000 recipes in 8 languages. Using camera recognition, Samsung Food A.I. lets users discover recipes, create shopping lists, and get nutritional insights.

• After securing a debt extension on Friday, Chinese developer Country Garden's shares rose by over 16% - the highest share price in nearly a month.

₿ Crypto Corner

• France’s data watchdog carried out ‘checks’ at the Worldcoin Paris office last week amid global regulatory pressure on the digital currency.

• Robinhood has agreed to buy back $605.7 million in stock from Sam Bankman-Fried, founder of the bankrupt crypto exchange FTX, in a deal with the US Marshal Service.

Markets

Index & Commodity Prices

Bond Prices

ASX By Sector

ETF Watch

Movers and Shakers

✅ Biggest Gainers

Liontown Resources (LTR) announced that it has received a revised non-binding proposal from Albemarle Corporation to acquire all of the ordinary shares outstanding in Liontown for $3.00 per share. An increase from the previous bid of $2.50 per share.

Liontown said it would unanimously recommend shareholders vote in favour of the proposal in the absence of a superior bid. Liontowns Kathleen Valley Lithium Project, located northeast of Perth, remains on target for first production in mid-2024. Liontown finished the day 8.7% higher to $2.85.

Mayne Pharma Group (MYX) shares rose 9.2% after the pharmaceutical company announced that one of its U.S. subsidiaries has agreed to acquire the global rights to RHOFADE® cream from Novan, Inc. and EPI Health. The cream treats rosacea in adults, a non-contagious skin inflammation that affects the face, giving the appearance of a permanent flush.

Mayne secured the deal for US$8 million in cash. For the 12 months ending March 31, EPI Health had approximately US$12 million in net sales for RHOFADE®.

🔻Biggest Fallers

Leo Lithium (LLL) shares crashed over 50% after resuming trading today. The Malian Ministry of Mines directed Leo Lithiums to suspend the Direct Shipping Ore (DSO) component of activities at the Goulamina Lithium Project. Despite this, mining continues as per the pre-existing plan, and mined ore is being stockpiled ahead of the first spodumene concentrate production in the second quarter of 2024.

The Government of Mali is assessing the company’s submission regarding DSO operations, but no formal response has been received yet.

Leo Lithium withdrew its guidance on direct shipping production and sales for 2023 and 2024 and will update only if and when approval is obtained from the government of Mali.

The stock price of Sky City N.Z. (SKC) has dropped to its lowest point since August 2020 after news of a potential suspension of their New Zealand license for ten days for failing to comply with a responsibility program.

The decision to investigate came after a customer filed a complaint with the Department of Internal Affairs in February 2022. The customer had gambled at the Auckland casino from August 2017 to February 2021. SKC shares finished the day down 14.7% to $1.85.

Deep Dive

August Movers

We take a look at five stocks that fell the most last month

1. Mesoblast (MSB): -55%, Market Cap: $374.5m. Mesoblast shares sunk early in the month following an update from the U.S. FDA in response to Mesoblast’s application for the drug therapy remestemcel-L. The FDA said it required more data before supporting marketing approval.

2. Chalice Mining (CHN): -39.5%, Market Cap: $1.2bn. Fell towards the end of the month after releasing a scoping study for its wholly-owned Gonneville Nickel-Copper-PGE Project in Western Australia. Lower-than-expected production estimates and what was seen as ambitious commodity pricing used in the modelling sent the share price lower.

3. Core Lithium (CXO):  -38.3%, Market Cap: $843m. The lithium miner has been in a downturn after a bumper 2022, reaching as high as $1.86 but now trading at $0.395. CXO raised $100 million in capital for $0.40 per share, which lowered its share price on August 17.

4. Iress (IRE): -38.3%, Market Cap: $1.2bn. Iress shares tanked 36% on the day of its earnings release as the company scrapped its interim dividend. The company’s underlying EBITDA fell by 55% while providing guidance that it expected both revenue and underlying EBITDA to be weaker in the second half of FY23.

5. Pantoro Minerals (PNR): -38.0%, Market Cap $248m. Another stock which fell on the back of a capital raise, with the gold miner raising $30m at $0.06 per share, with the money to support working capital requirements for its wholly owned Norseman project, located 725 km east of Perth.

Daily Quiz

Test Your Knowledge

Aussie Retailers And Their Margins.

Yesterday’s Daily Quiz Question: Which U.S. listed company has the largest Revenue (TTM)

Answer: Walmart. Well done to the 38% of people who got this correct. Walmart’s TTM revenue is $622.02bn, followed by Amazon ($538.04bn) and Berkshire Hathaway ($401.81bn).

A Little Extra

📉 Going Down?

Top 10 shorted stocks on the ASX - as of August 29

1. Flight Centre (FLT) - 10.33%

2. Pilbara Resources (PLS) - 9.63%

3. Syrah Resources (SYR) - 9.25%

4. Elders Limited (ELD) - 9.07%

5. Lake Resources (LKE) - 8.55%

6. IDP Education (IEL) - 8.39%

7. JB Hi-Fi (JBH) - 8.32%

8. Brainchip (BRN) - 8.20%

9. 29Metals (29M) - 7.54% 

10. Mesoblast (MSB) - 7.48%

📊Broker Ratings

What do the brokers have to say?

1. Chalice Mining (CHN) - Downgrade to Hold from Add (Morgans)

2. Fisher & Paykel Healthcare (FPH) - Downgraded to Neutral from Outperform (Macquarie)

3. Resimac Group (RMC) - Downgrade to Hold from Buy (Bell Potter)

💲Dividends

Companies trading ex-dividend today

1. Altium Ltd (ALU) $0.29

2. Atlas Pearls Ltd (ATP) $0.003

3. Australian Finance Group Ltd (AFG) $0.041

4. Beach Energy Ltd (BPT) $0.02

5. Bendigo and Adelaide Bank Ltd (BEN) $0.32

6. Fortescue Metals Group Ltd (FMG) $1.00

7. GR Engineering Services Ltd (GNG) $0.10

8. IDP Education Ltd (IEL) $0.20

9. Lifestyle Communities Ltd (LIC) $0.06

10. Mcpherson’s Ltd (MCP) $0.01

11. Nib Holdings Ltd (NHF) $0.15

12. Peter Warren Automotive Holdings Ltd (PWR) $0.11

13. Servcorp Ltd (SRV) $0.12

14. TPC Consolidated Ltd (TPC) $0.3

15. Vitura Health Ltd (VIT) $0.01

📅 Economic Calendar

Data to keep an eye on this week

Reader Review

DISCLAIMER: None of the information provided in this newsletter should be constituted as financial advice. This newsletter is strictly for educational purposes only. It should not be taken as investment advice or a solicitation to buy or sell assets or make financial decisions. Please do your research.