Well, now we know.
The Reserve Bank of Australia (RBA) cut the official cash rate by 25 basis points to a new record low of 2.25% – and I got it completely wrong – along with a bunch of professional economists.
I'm giving up my short career as an economic forecaster…again, until next month.
Thanks to the rate cut, the S&P/ASX 200 (Index: ^AXJO) (ASX: XJO) has rocketed up 1.6% and its ninth consecutive day of gains.
While that might be great, several stocks have seen their share prices soar…
Donaco International Ltd (ASX: DNA) is up 28.4% to 69 cents, after coming out of a trading halt. The casino operator, with one casino in Vietnam, has just acquired the Star Vegas Resort & Club in Cambodia for US$360 million. This could be a company transforming buy, with the company forecasting strong long-term revenues and profit growth. Despite today's price rise, Donaco may be worth a closer look.
Beleaguered copper miner Tiger Resources Limited (ASX: TGS) has gained 17.2% to 6.8 cents. It appears that a number of bargain hunters have jumped on board Tiger, following the stock's 60% crash last week. But they may be disappointed, with the company now holding a substantial amount of debt and struggling to generate any meaningful free cash flow, thanks to rising operating costs and falling copper prices. Foolish investors may want to steer clear.
Satellite company Newsat Limited (ASX: NWT) has gained 28.6% to 13 cents, but still has several major issues to overcome. As per my colleague Brendon Lau's article earlier today, the company is in dispute with one of its clients, as well as satellite builder Lockheed Martin. Once a company that seemed to promise much, this could all end badly for shareholders.
Beach Energy Limited (ASX: BPT) has soared 14.9% to $1.16, as Seven Group Holdings Ltd (ASX: SVW) ups it stake in the oil and gas producer to 13.8%. Seven's CEO Don Voelte noted that his company has a strategy of "participating in high-quality energy opportunities that will add shareholder value". Seven may well be diversifying because its mining equipment business, Westrac, is headed for a shocker year as mining investment crashes.
