Hot Stocks: Perenti, Dateline Resources, Washington H Soul Pattinson

Wall Street ended a choppy week on a subdued note, with the S&P 500 closing flat at 5,911.69. Still, May proved a standout month for US equities, with the S&P gaining 6.2%—its best since November 2023—while the Nasdaq surged nearly 10% and the Dow rose 4%. Early-month optimism was fuelled by a new US-UK trade deal, but renewed trade tensions took centre stage late in the week. President Trump accused China of breaching a prior deal, floated new tech restrictions, and was hit by a federal court ruling challenging his tariff regime—though that decision has been temporarily stayed. The administration is now weighing fallback legal tools, including invoking the Trade Act of 1974.

Trump further escalated trade tensions with a surprise announcement on Friday: US tariffs on steel and aluminium imports will double from 25% to 50% starting 4 June. Speaking in Pennsylvania, Trump framed the move as a national security measure linked to a revised US$14bn investment deal between US Steel and Japan’s Nippon Steel. The backlash was immediate—EU, UK, Canada, and Australia condemned the move, warning of retaliatory tariffs and broader economic fallout. The EU confirmed it may reinstate paused countermeasures by mid-July, while Australia called the tariff “unjustified” and “self-harming.” The White House insists the deal will preserve US jobs and domestic control of US Steel, though full details remain unclear.

OPEC+ announced a third consecutive production hike, adding 411,000 barrels per day in July as it continues to unwind earlier cuts. The alliance, led by Saudi Arabia and Russia, cited strong market fundamentals and summer demand as justification. However, the decision comes amid falling oil prices—Brent closed at US$63.93 and WTI at US$60.73—and concerns about a potential global surplus. Analysts suggest the move may aim to discipline quota violators like Iraq and Kazakhstan while pressuring US shale producers. The International Energy Agency expects a 2025 surplus of 730,000 bpd, with oil demand growth slowing due to economic headwinds and the rise of electric vehicles. While OPEC+ left the door open to adjust course, the long-term outlook is increasingly shaped by energy transition trends and non-OPEC+ supply growth.

Mining services group Perenti (ASX:PRN) has secured a major five-year, A$1.1bn underground mining contract at the Mana gold mine in Burkina Faso with Endeavour Mining. The deal extends Perenti’s operations at the Siou and Wona deposits and will be executed through a joint venture with local partner Dynamic Mining Supply. The contract includes development, production, and support services and aligns with Perenti’s FY25 guidance, with long-term earnings contribution anticipated.

Dateline Resources (ASX:DTR) is advancing exploration at its 100%-owned Colosseum Gold and Rare Earth Element (REE) Project in California, which already hosts a JORC-compliant 1.1Moz gold resource. New geochemical and geophysical findings suggest the presence of a larger breccia pipe complex and REE-bearing zones, similar in geology to the nearby Mountain Pass mine. A multi-phase program, including soil sampling, magnetotelluric surveys, and drilling, is now underway to target both gold and REE potential. The project’s updated economics show a US$550m NPV and 61% IRR at US$2,900/oz gold.

Soul Patts and Brickworks agree to $14bn merger, ending decades-long cross-shareholding

Washington H. Soul Pattinson (ASX:SOL) and Brickworks (ASX:BKW) have agreed to merge in a $14bn deal that will create a newly capitalised ASX-listed company, eliminating their longstanding cross-shareholding. Under the agreement, Soul Patts shareholders will receive one TopCo share per SOL share, and Brickworks shareholders will receive 0.82 TopCo shares per BKW share — implying a 10.1% premium to BKW’s last closing price. The merged entity, to retain the Washington H. Soul Pattinson name and ticker (ASX:SOL), will combine Soul Patts’ diversified investment portfolio with Brickworks’ building products and industrial property assets. The merger is unanimously supported by both boards (in the absence of a superior proposal) and is subject to shareholder and court approvals. A $550m capital raise has already been underwritten to help fund the transaction, reduce debt, and simplify the balance sheet.