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Key Points

  • The Australian sharemarket is poised to rise at the open this morning.
  • Tensions between the US and China continue to simmer.

Sandfire to restart drilling in Botswana

William McInnes

Sandfire Resources is set to resume exploration activity in Botswana by early June after the government announced a phased ending of COVID-19 restrictions.

The company said plans are underway for a staged restart of exploration activity that should see resource drilling at its A4 discovery resume in the next few weeks.

The company also said it had executed a binding agreement with Australian explorer to acquire a ~6,700 km² land package in Namibia.

The licences for the package are located immediately along strike to the west of Sandfire’s Tshukudu licences in Botswana and cover a large, underexplored area within the western part of the Belt.

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China weighs on commodity prices

William McInnes

Oil, iron ore and base metal prices all fell over the weekend, with China driving the weakness across most markets.

sank, with Brent crude down 2.6 per cent to $US35.13 a barrel on Friday as doubts lingered about China’s demand for the rest of the year.

Meanwhile iron ore prices dipped 1.1 per cent to $US96.85 a tonne with the Chinese government’s work report delivered on day 1 of the National People’s disappointed markets.

Base metals were also broadly weaker.

“Increased tensions between the US and China weighed on sentiment after China introduced new security legislation impacting Hong Kong,” said NAB head of commodity research Lachlan Shaw.

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China headwinds put recovery at risk

The highs recorded on sharemarkets in Australia and overseas last week could come under threat in the coming days, as relations between the world’s two largest economies rattle optimism and threaten another sell-off in shares.

The S&P/ASX 200 Index hit a two-month high in the middle of last week, which came after the US Nasdaq ended Wednesday just 4.5 per cent from its record close.

In addition to central and government stimulus, the rally was fuelled by reported progress on a vaccine and the ongoing wind-back of restrictions, which has seen commodity prices rise as economic activity lifts from historical lows.

But investors’ nerves were tested towards the end of the week as tensions between the US and China were again thrown into the spotlight after officials in Washington rebuked Beijing for national security laws viewed as a threat to the autonomy of Hong Kong.

“As someone who’s lived in the Asian time zone for almost 40 years now, the move in Hong Kong is quite a serious issue,” said Federation Asset Management adviser and former Merrill Lynch executive, .

“There’s been a handful of stocks that have led the US recovery,” Mr Bundy added, referring to Facebook, Apple, Netflix and Alphabet.

“If any of those stocks faced any retaliation from the … you would probably see … a 5 to 10 per cent sell-off pretty quickly.”

Read the full story at

Stocks mixed; gold firms

Here are the weekend market highlights:

  • AUD -0.4% to 65.37 US cents (Year to date: -6.9%)
  • On Wall St: Dow flat S&P 500 +0.2% Nasdaq +0.4%
  • In New York: BHP -0.1% Rio +0.6% Atlassian +1.3%
  • In Europe: Stoxx 50 flat FTSE -0.4% CAC flat DAX +0.1%
  • Spot gold +0.4% to $US1734.68 an ounce in New York
  • Brent crude -2.6% to $US35.13 a barrel
  • US oil -2% to $US33.25 a barrel
  • Iron ore -0.6% to $US97.65 a tonne
  • Dalian iron ore -0.1% to 722 yuan
  • LME aluminium -1.3% to $US1502 a tonne
  • LME copper -1.9% to $US5287.50 a tonne
  • 2-year yield: US 0.17% Australia 0.24%
  • 5-year yield: US 0.33% Australia 0.38%
  • 10-year yield: US 0.66% Australia 0.86% -0.49%
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Read Timothy Moore’s Before the Bell here.

Good morning

Good morning and welcome to Markets Live for Monday.

This blog is not intended as investment advice.

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