ASX200 - 3 stocks to watch

After its 1.5% capitulation last week, the ASX200 all but reached our long-standing pullback target from the 7632 high, near 7300. In the early stages of this week, the ASX200 has found a firmer footing.

Australia

Partly on the back of another round of merger and acquisition activity, this time involving Sydney Airports and a consortium of cashed-up super funds. As well as from gains in the materials and energy sectors after crude oil extended its rally to a six-week high. 


With this in mind, we look at three stocks we think are worth watching, given the themes currently driving the ASX200.

1. Oil Search Ltd (OSH)

Crude oil closed above $70.50 overnight as the impact from Hurricane Ida on the U.S. Gulf Coast continues to linger. Goldman Sachs and JP Morgan have both noted that Hurricane Ida has been unique in having a net bullish impact on U.S. and global oil balances.

Should crude oil prices continue to rally, Oil Search, which is trading almost 5% higher today, should also move higher. 

A break and close above trend channel resistance near $4.00 would indicate further upside towards $4.30, before the March $4.68 high. On the downside, good support is viewed ahead of $3.60.Oil Search Daily Chart


2. Oz Minerals (OZL)

Oz Minerals is a South Australian-based copper mining company whose share price has rallied 6% this week after news on Friday that Shanghai copper stocks fell to their lowest level in almost ten years. 

Should the share price break and close above trend channel resistance near $25.10, it would open the way for the rally to retest the March high at $27.15. On the downside, near-term support is viewed at $24.00, before medium-term support at $22.50. 

Oz Minerals Daily Chart


3. Fortescue Metal Group (FMG) 

The share price of the iron ore mining giant has fallen more than 30% over the past two months, in line with the sharp selloff in the price of iron ore. 

China, which buys 97% of all iron ore from Australia and Brazil, is cutting steel output to reduce carbon emissions at the same time as Brazil is increasing supply. 

The share price of FMG is now approaching the 50% Fibonacci retracement at $17.40 of the rally from the $8.20 Covid crash low to the July $25.58 high.

Should signs of basing be viewed ahead of $17.40, a recovery of sorts may be in the offering. However, should the price break below $17.40ish, there is room for the decline to extend towards medium-term support $15.60/30 area. 

Fortescue Mining Daily Chart


Source Tradingview. The figures stated areas of September 14th, 2021. Past performance is not a reliable indicator of future performance. This report does not contain and is not to be taken as containing any financial product advice or financial product recommendation

More from ASX

Disclaimer

This report is intended for general circulation only. It should not be construed as a recommendation, or an offer (or solicitation of an offer) to buy or sell any financial products. The information provided does not take into account your specific investment objectives, financial situation or particular needs. Before you act on any recommendation that may be contained in this report, independent advice ought to be sought from a financial adviser regarding the suitability of the investment product, taking into account your specific investment objectives, financial situation or particular needs.

StoneX Financial Pte. Ltd., may distribute reports produced by its respective foreign entities or affiliates within the StoneX group of companies or third parties pursuant to an arrangement under Regulation 32C of the Financial Advisers Regulations. Where the report is distributed to a person in Singapore who is not an accredited investor, expert investor or an institutional investor (as defined in the Securities Futures Act), StoneX Financial Pte. Ltd. accepts legal responsibility to such persons for the contents of the report only to the extent required by law. Singapore recipients should contact StoneX Financial Pte. Ltd. at 6826 9988 for matters arising from, or in connection with the report.

In the case of all other recipients of this report, to the extent permitted by applicable laws and regulations neither StoneX Financial Pte. Ltd. nor its associated companies will be responsible or liable for any loss or damage incurred arising out of, or in connection with, any use of the information contained in this report and all such liability is hereby expressly disclaimed. No representation or warranty is made, express or implied, that the content of this report is complete or accurate.

StoneX Financial Pte. Ltd. is not under any obligation to update this report.

Trading CFDs and FX on margin carries a high level of risk that may not be suitable for some investors. Consider your investment objectives, level of experience, financial resources, risk appetite and other relevant circumstances carefully. The possibility exists that you could lose some or all of your investments, including your initial deposits. If in doubt, please seek independent expert advice. Visit cityindex.com.sg for the complete Risk Disclosure Statement.