Ann: Appendix 3B, page-6

Topped up some today.

Dows dropped 2.5% is because US economy is too strong (ie job number was much better than expected and market is worry about inflation) and bond market did not factor in possible 3 rate increases (US rate not Australian rate) this year. Hence the sell off because more US rate increases coming to keep lid on inflation.

Copper and zinc prices are still very strong especially zinc. Further, the differential between Australian rate and US rate will widen, and, hence, Australia dollar should fall sharply. If we get 3 US rate increases and 1 Australian rate increases, Australian dollar should be trading at 60c+ (not 79c currently). This should benefit Australian resource companies including PEX.

Fundamentally, IMHO there is absolutely no reason for any resource company's share price to fall. Actually, this will benefit Australian resource companies. Further, Dows gone up ridiculously high to over-priced and ASX is still reasonably priced.