Morning Market News. Tuesday, 28 November Market Overview

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1 Summary The bulls are not likely to as forthcoming to the upward challenge. Yesterday got off to a shaky start, but the benchmark S&P/ASX200 soon gathered momentum to take the challenge through the 6,000 thresholds. However, it wasn t long before the bears responded after prices printed a 6, high. From yesterday s retreat, the S&P/ASX200 is expected to remain on the backfoot to this morning s opening. Market Overview ASX200 5, % SPI Futures (Dec) 5, % S&P 500 2, % Nasdaq 6, % Oil (WTI) $ % Iron Ore $ % (Spot) Gold $1, % AUD/USD US % The ASX 200 open The technical outlook remains questionable whether the benchmark S&P/ASX200 has the dynamics to restore the bullish sentiment since breaking the broader uptrend fully. Overall, it still likely fresh attempts towards (or beyond) the 6,000, it is foreseeable that the S&P/ASX200 will eventually ease back to levels of 5, In the Markets U.S. Stock markets consolidate as the Senate gets set to vote on tax reform bill this week Overnight, the U.S. stock market was on the quieter side as the market consolidates, as investors looked ahead to a key vote on tax reform. The Dow Jones industrial average futures were up slightly by % at 23,580.78, while S&P 500 slightly weaker and down 0.04% at 2, The NASDAQ Composite also down by 0.15%. The Senate is expected to vote on a bill aimed at reforming the U.S. tax code on Thursday. The market has been eagerly awaiting tax reform since last year's election, but doubts about whether the Republican-led Congress would be able to achieve this before year-end have lingered. President Donald Trump stated last week that his administration was going to "give the American people a huge tax cut for Christmas," according to the Associated Press. Also, overnight, the U.S. dollar recovered from a two-month low as the market looks ahead to Fed Governor Jerome Powell s Congressional hearing. Powell, who was nominated by President Donald Trump to lead the Federal Reserve, is scheduled to appear before Congress on Tuesday. 1

2 Crude Oil Prices plummets 1.7% overnight, has the market established a near-term top? The price for crude oil settled lower overnight as uncertainty concerning Russia s willingness to extend output curbs beyond March along with OPEC meeting this week weighed on sentiment. On the New York Mercantile Exchange crude futures fell 1.76% to settle at $57.91 a barrel, while on London's Intercontinental Exchange, Brent gained 0.65% to trade at $63.88 a barrel. Despite expectations that OPEC will agree to extend its production cut agreement beyond March at its Nov. 30 meeting, the market is showing concerns whether Russia would agree to join in extending output curbs amid fears that major oil producers, particularly U.S. shale producers, who are not part of the pact will ramp up output to gain market share. U.S. crude oil production has risen by 15% to 9.66 million barrels per day (bpd) since mid-2016, not far from top producers Russia and Saudi Arabia, while recent data showing a rise in drilling activity indicated an ongoing increase in US production. Baker Hughes reported last week that the number of U.S. oil rigs rose by 9 to 747. US rig counts are on track for a monthly gain for the first time since July. The market will be eagerly awaiting this week s numbers out on Friday! In the week ahead - Tuesday - The American Petroleum Institute, an industry group, is to publish its weekly report on U.S. oil supplies. Wednesday - The U.S. Energy Information Administration is to release weekly data on oil and gasoline stockpiles. Thursday - Major global oil producers are due to meet in Vienna in order to decide on extending their current output-cut deal. The U.S. government will publish a weekly report on natural gas supplies in storage. Friday - Baker Hughes will release weekly data on the U.S. oil rig count. The price of gold leaps above 1-month highs after reports that North Korea looks to another missile test! The bullish charm returned for the precious yellow metal overnight as prices rallied more-than-one month high buoyed by an uptick in safe-haven demand amid reports suggesting North Korea was preparing to launch a missile as part of its army s winter training regime. The price for spot gold leaped over 12 dollars from $1,286 low and reached the technical objective after printing a $1,299 high. A Japanese diplomat warned on Monday that radio signals detected from the North Korea indicated another North Korean missile test was close, fuelling demand for safe-haven gold. There is a possibility of missiles launches in the next few days, a Japanese government official said on Monday, according to Japan's Kyodo news agency. The potential of fresh missile launches from the Kim Jongun led nation is believed to be part of the North Korea army s winter training regime. Local gold companies should benefit from the renewed demand! Technical outlook for gold The blueprint for spot gold remains bullish. A break over $1, exposes the region of $1,310. Is Iron ore's winning streak coming to an end as the market look to $69.00 cap? The market eyes will look to the Iron ore today after the spot markets fell on Monday, snapping a fourday winning streak in the process. According to Metal Bulletin, the price for benchmark 62% fines slipped 1% to $67.27 a tonne, pulling back from a four-month high struck on Friday. The weakness in the benchmark was mirrored across the grades. Technical implications support a potential cap from the region of $

3 The Australian Dollar Outlook Overnight, the Australian dollar retreats from a high after the greenback recaptured its bullish charm. It is viewed renewed momentum should continue to fail above the level, with the capping. Overall, the outlook should soon again turn back towards the region of Market Movers The Bears Stocks tipped to fall Coca-Cola Amatil (CCL) hits lows of 2008! ($7.72, up %) The recent up challenge peaked two-weeks ago at $8.20, and since then, in the last 14-days, this share has not looked back! On Friday, Coca-Cola Amatil traded at a low of $7.52, which was last witnessed back in the GFC in From the weekly technical implication, it still concerning that this share may not find any short-term demand till prices hit the region of $ , which was where the market rebound aggressively in the mid Renewed upside attempts may fail towards the region of $7.95 to $

4 Galaxy Resources (GXY) ($3.69, up %) Since the bullish trend began in late 2015, this market has increased to the bearish sentiment, since the peak at $4.08, 14-days ago. If this downward pattern keeps on its current journey, then we could see the selling pressure increasing the prices region the vicinity of $ From there, its make or break from this level. Failing to stage any bullish rebound, then a decisive break of $ , would expose the region of $1.75! Resistance is expected to serve from the recent highs around $ Cleanaway Waste Management Ltd (CWY) ($1.50% flat 0.00%) This share price has failed to gather momentum or more to the point buying interest since prices peaked three weeks ago at $1.62. What is apparent is that selling pressure may continue into this week, with no safety net seen until the region of $1.30! A weekly graph of Cleanaway Waste Management Ltd (CWY) Starpharma Holdings Limited (SPL) ($1.405 up %) The bullish trend was evident in this share after establishing a base early this year in June around 0.66 cents. The upside potential is now slowly diminishing since the peak three-weeks ago at $1.51. If supply increases, then the bearish fate for this share holds towards $1.20 If the bulls fail to support this level, then the call would hold lower, towards $1.00, before the likelihood of any potential buying! 4

5 The Bulls Stocks that are expected to rise Its hemp week - Are cannabis stocks smoking hot right now? Some ASX-listed cannabis stocks are surging after cannabis stocks have taken off in the past few days. Botanix Pharmaceuticals Ltd (BOT) ($0.059, down -1.67%) This share has the markings for a bullish breakout, target 0.11 cents. Reassess from there. Medlab Clinical Ltd (MDC) (0.83 cents down %) At present this share may have the scope of reaching a target of $0.89 to $0.96, with the likelihood of renews buying interest (pullback) from 0.60 cents. MMJ Phytotech Ltd (MMJ) ($0.50 flat 0.00%) At present this share may have the scope of reaching a target of $0.57 to $0.72, with the possibility of renews buying interest (pullback) from $0.34-$0.36 cents. MGC Pharmaceuticals Ltd (MXC) ($0.097 up %) This share has the markings for a bullish breakout, if $0.12 is cleared, target $0.18. Reassess from there. Zelda Therapeutics Ltd (ZLD) ($0.115 up ) The direction is expected to remain northbound with a conceivable target seen to $0.16, or even scope to $0.26 to $0.32. Reassess from there, with the support viewed at $0.08. ON our radar - Creso Pharma Ltd (CPH) - We are looking for a short-term pullback to buy. We will be monitoring any pullback to $1.02. If seen we would first assess, if the market is a buy or if the call is lower to 0.88 to If the dynamics remain bullish, then we could see a target of $2.20! Company Last Price Buy / Sell Price Target Confidence CCL $7.72 S $ GXY $3.69 S $ CWY $1.50 S $ SPL $1.405 S $1.20 BOT $0.059 B $0.11 MDC $0.83 B $ MMJ $0.50 B $ MXC $0.097 B $ ZLD $0.115 B $0.16, $0.32 CPH $1.34 B $2.20 5

6 ECONOMIC CALENDAR Tuesday, November 28 The Bank of England is to publish its financial stability report. Canada is to report on raw material price inflation. The U.S. is to release data on consumer confidence. Fed governor Jerome Powell, selected by President Donald Trump as the next Fed chair, appears before the Senate Banking Committee for his confirmation hearing. Philadelphia Fed President Patrick Harker is to speak. Bank of Canada Governor Stephen Poloz is to speak at an event in Ottawa. The Reserve Bank of New Zealand is to publish its financial stability report. Wednesday, November 29 Germany is to release preliminary data on inflation. The UK is to publish data on net lending. The U.S. is to release revised data on third-quarter growth. New York Fed President William Dudley is to speak. Fed Chair Janet Yellen is to testify on the U.S. economic outlook before Joint Economic Committee of Congress, in Washington. The U.S. is to release data on pending home sales. Thursday, November 30 New Zealand is to release data on business confidence. Australia is to publish figures on private capital expenditure and building approvals. China is to produce a report on manufacturing and service sector growth. The euro zone is to publish its preliminary inflation estimate. The U.S. is to release data on personal income and consumer spending, which includes the personal consumption expenditures (PCE) inflation data, the Fed's preferred metric for inflation. The U.S. is also to publish the weekly report on jobless claims and data on business activity in the Chicago region. Dallas Fed President Robert Kaplan is to speak. Friday, December 1 China is to publish its Caixin manufacturing index. The UK is to publish its manufacturing index. Canada is to publish data on economic growth and employment. Dallas Fed President Robert Kaplan and Philadelphia Fed President Patrick Harker are to speak. The Institute for Supply Management is to publish its manufacturing index. Disclaimer: Nothing in this research shall be construed as a solicitation to buy or sell any security or product, or to engage in or refrain from engaging in any transaction. This research is general advice and does not take account of your objectives, financial situation or needs. Before acting on this general advice, you should consider the appropriateness of the advice having regard to your situation. We recommend you obtain financial, legal and taxation advice before making any financial investment decision. There are risks involved in any financial investment and the value of any investment can and does fluctuate and may even become valueless. This research is based on information obtained from sources believed to be reliable but we do not make any representation or warranty that it is accurate, complete or up to date. We accept no obligation to correct or update the information or opinions in it. Opinions expressed are subject to change without notice. Kaz Capital does not accept any liability whatsoever for any direct, indirect, consequential or other loss arising from any use of this research and/or further communication in relation to this research. Unless otherwise noted, market and stock price outlook is taken from a technical perspective and seen from the oscillator s pattern being (Stochastic, MACD, RSI, and momentum), with no fundamental influence taken to these views. 6