Stock watch

Sundance Energy

Sundance Energy shares are trading at a deep discount according to Morgans, who have given the oil and gas company an "add" recommendation. Sundance is completing a large acquisition at the Eagle Ford play in North America. The company is raising US$260 million in equity to fund the US$221m acquisition of 8760 hectares, with the extra money raised helping to strengthen its balance sheet. If the deal is successful, Sundance will become one of the largest oil producers listed on the ASX, according to Morgans, which has set the company's target price at 21¢ versus the current price of 5.8¢. "If successful in ramping-up production, SEA will emerge as one of the largest oil producers on the ASX, at a time when the market is positively re-rating the sector," the broker said.

US Dollar

Worries about escalating trade tensions between the US and China continue to support the US dollar. The dollar is also being supported by evidence of rising inflation pressures in the "prices paid" sub-component of The Institute of Supply Management manufacturing index, which rose to a seven-year high in March. A recent unemployment report in US on Friday pointed to an above average increase in non-farm payrolls, and business and consumer surveys are suggesting that earning growth is skewed upwards. If this upside risk materialises, it will also bode well for the US dollar in the near term.

Mining companies

Mining companies were among the best performers on the market on Tuesday. Gold prices climbed 1.3 per cent on Monday, the biggest one day percentage rise in a week and helping Resolute Mining, Evolution Mining and Independence Group all pushing firmly higher. Nickel and copper producers were also among the market's best performers. Newcrest Mining recorded a strong opening following news that its Cadia mine had recommended processing over the Easter weekend. Operations at the mine were halted after a wall collapse at its northern tailings dam. Processing at the mine is still running at a limited capacity due to infrastructure limitations to its southern tailings facility.