Report Cover Page

Contents

Where are we in the Cycle?
There is still no sign of a volume driven cyclical upturn with the latest OECD leading indicators highlighting the possibility of further output growth momentum losses during the balance of 2016 before an improvement late in the year or in 2017.    More...

Market Directions
‘Brexit’ reared its head as a risk leaving markets once again event driven and likely to be dominated by speculations about central bank reactions.    More...

Portfolio Performance and Positioning
PortfolioDirect portfolio turnover has risen. Some outstanding market gains assisted by ‘bottom of the cycle’ leverage among smaller stocks could not be sustained without a stronger flow of funds in support. Several stocks have been deleted and others added or reweighted in response to near-term market moves.   More...

Stock Reviews and Rating Analysis
Thundelarra (THX:AU), in the midst of a capital raising via a share purchase plan, illustrates the dilemma confronting companies needing capital to fulfil their long term development ambitions but having to confront the costs of doing so. The $17 million company could raise a potential $5.1 million at 5 cents but more likely a still handy $1.5-2 million, all going well. After announcing the plan, the company’s share price fell 18% immediately to the 5 cents offer with existing shareholders knowing they could sell and buy back costlessly at a lower price. An extension of the offer period by a fortnight is prolonging the weakness. The infusion of new shares will then open the possibility of some shareholders wanting to disgorge a portion of their new purchases in which event investors could face more downward pressure in the weeks ahead. Thundelarra has been selected for the PortfolioDirect Phase I portfolio to reflect the value beyond these pressures.
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Although the statements of fact in this communication have been added from and are based upon sources E.I.M. Capital Managers Pty Ltd, the publisher, believes to be reliable, their accuracy is not guaranteed and any such information may be incomplete or condensed.

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