Local markets are eating it this morning, dropping more points than a punch-drunk tennis pro and – frankly – it’s beginning to upset a few people.
You know things are bad when the guys who turn up every couple of weeks to dig up the footpath outside my house for no appreciable reason are leaning on their shovels and talking about the ASX.
I shan’t repeat precisely what they had to say, but a lot of it rhymed with the words trucking, titmouse and gherkin terrible, all delivered at a sustained bellow loud enough to be heard halfway down the street.
They’re not wrong, though. The ASX 200 fell -1.6% in very short order this morning, bottoming out at 10.30am and setting of on a stoic, if somewhat quixotic, journey back to the right side of zero.
I don’t think it’s gonna make it, though.
I’ll get into the details shortly, but first we’re off to Japan, where the city of Tokyo is taking a break from being molested by Godzilla to allow citizens there to elect a new governor, and things have gotten a little weird.
It’s mostly due to one candidate, Kawai Yusuke, who is running on a platform that has been a bit hard to pin down, but apparently is mostly concerned (at this stage) with breaking down the existing political system that has allowed dynastic candidates to flourish, intertwined with rants about Japanese Buddhist organisation Soka Gakkai and its political wing, known as Komeito.
As per Japanese electoral rules, state television is required to give every gubernatorial (oh, how I love that word) candidate air time to explain their policies to the people of the city.
Which is why this happened.
An official election speech that just aired on Japanese public TV: Joker politician Kawai Yusuke declared that all one can do is “just laugh” at the state of Tokyo. He also doesn’t like political dynasties and the influence of Soka Gakkai/Komeito.pic.twitter.com/WCgKh2sfh8
— Jeffrey J. Hall (@mrjeffu) June 25, 2024
Yusuke also made headlines this week when his campaign posters had to be taken down, as they were considered to be “lewd” – which, to be fair, they really, really were.
Part of his electoral platform is his push to end censorship of Japanese pornography, which is currently a nightmare of pixelated genitals and all manner of Lovecraftian tentacled creatures – or so I’m told.
Yusuke’s chances of being elected are probably best described as “rapidly approaching zero”, but while the Joker trope may have been played out already, it takes a special kind of weirdo to deliver a televised stump speech that is both terrifying and baffling at the same time.
TO MARKETS
Local markets were on the nose this morning, a sharp turnaround from yesterday’s half-decent day that left the ASX 200 down around -1.6% within 30 minutes of the doors opening for business.
That’s because of yesterday’s inflation data and god help me if I have to write about it one more time, I’m going to lose my mind.
The gist of it, though, is simple. Inflation went up more than anyone was expecting. That’s put talk of rate cuts deep into the bin, and even raised the spectre of a rate hike in the near future, because – as the whole country now knows – inflation is a gargantuan beast that can only be controlled by The Interest Rate Lever, which I suspect is some kind of magic wand that the Reserve Bank currently has control of and is refusing to let anyone else touch.
But, all hope is not lost for local investors today. The benchmark has staged something of a turnaround on the way towards lunch, and is trudging doggedly up from this morning’s low point to pretty close to -1.0% – which isn’t excellent… it’s just a bit better.
Whether the market has the steam to continue to climb remains to be seen, as it’s a huge hurdle to come back from. That said, stranger things have happened, and I wouldn’t put it past the benchmark to dig deep and perform well, like the Little Engine that Could.
Around midday, the market sectors looked like this:
Chart via Marketindex.com.au
And the more granular ASX indices looked like this:
Chart via Marketindex.com.au
Aside from the ASX being pantsed in early trade, there’s not a huge amount happening around the place today.
I should probably mention that the Australian Banking Association has released its Banking Code of Practice, which landed with an audible thunk this morning.
I can tell you that it is 44 pages long, and fully 6 of those pages are given over to a glossary to help explain what the hell most of it even means.
It’s not a particularly user-friendly document, written entirely in language that – at best – could be described as fluent Bureaucrat, with a smattering of Legalese thrown in for good measure.
I can also tell you that it’s ponderously boring, so if you’re having trouble sleeping at night, I recommend reading two copies of it just before bed and you’ll be off to never-never-land faster than you can say “why is that man throwing sand at my bed?”
But, for what it’s worth, the new Banking Code of Practice is now definitely a thing, and it should help protect consumers from those pesky old banks that can’t seem to help themselves when it comes to Doing The Right Thing for their customers.
NOT THE ASX
Things were happier in New York overnight than they were in Sydney this morning, with Wall Street’s action leaving the S&P 500 up by 0.16%, the blue chips Dow Jones index up by 0.04%, and the tech-heavy Nasdaq higher by 0.49%.
The banner headline news among US stocks was Amazon’s feat of breaking through the $2 trillion market cap mark for the first time, after it managed a +4% rise over the course of the session.
That was largely attributed to EV truck maker Rivian Automotive – which Amazon owns a 17% chunk of – surging 23% off the back of an announcement that Volkswagen plans to invest US$5 billion to establish a joint venture with the company.
On the topic of EVs, Tesla shares are proving to be remarkably robust, gaining +4.8% overnight despite the company recently announcing that it will be recalling all 12,000 of its ridiculous Cybertrucks for the third, and fourth time – to be served concurrently.
The issue this time is, obviously, two-fold – firstly, there’s a part of the vehicle’s external trim around the rear window that has been showing a propensity for falling off, because it hasn’t been installed properly on a large number of the brutish offroaders.
And, perhaps more importantly, the electric motor that drives the single monstrous windscreen wiper up the front is, according to Tesla, playing up on a large number of vehicles, thanks to a wiring fault that is pushing way too much power into the motor and causing it to fail.
The Cybertruck only hit public roads in the US in November last year – four all-vehicle recalls in just seven months is a record that is going to take some beating for the beleaguered eyesore.
In other US stock news, Chip maker Micron Technology tumbled 7% post-market after its projected revenue for the current quarter only just met with the market consensus.
Micron’s slump dragged down several chipmakers, including Nvidia Corp, which also fell 1.5% after hours.
FedEX Corp’s shares surged by 15%, the largest single day gain for the company since 1986, buoyed by a strong quarterly earnings report.
Moderna Inc sank 11% following new data showing that the efficacy of its RSV (respiratory syncytial virus) vaccine significantly dropped in the second year and was inferior to that of competitor vaccines.
And Trump Media shares are being caned in a major sell-off this week, shedding 15% overnight to end the session at $26.75 per share – waaaaay below the $49 per share pricetag the company boasted at the start of June.
In Asian market news, our major neighbours are all struggling this morning as well. Shanghai markets are down -0.33%, Hong Kong’s Hang Seng is down 0.80%, and Japan’s Nikkei has dropped 1.13% this morning.
Japan is struggling with a rapidly weakening Yen, which has hit a 38-year-low against the US Dollar today, falling to 160.82 against the greenback and sparking rumblings that somebody might need to step in and do something about it – like Japan’s Ministry of Finance did the last time the yen sank this low in April of this year.
ASX SMALL CAP WINNERS
Here are the best performing ASX small cap stocks for 27 June [intraday]:
Swipe or scroll to reveal full table. Click headings to sort:
Code Company Price % Change Volume Market Cap AN1 Anagenics Limited 0.01 43% 712,831 $3,229,243 MHC Manhattan Corp Ltd 0.002 33% 224,500 $4,405,470 RBR RBR Group Ltd 0.002 33% 2,450,000 $1,634,405 SPX Spenda Limited 0.008 33% 11,770,377 $25,946,747 AYT Austin Metals Ltd 0.005 25% 181,673 $5,296,765 HXL Hexima 0.01 25% 750,184 $1,336,317 BBN Baby Bunting Grp Ltd 1.53 24% 1,326,372 $166,609,514 RNX Renegade Exploration 0.016 23% 5,400,637 $16,640,695 DGR DGR Global Ltd 0.011 22% 607,035 $9,393,241 NVU Nanoveu Limited 0.022 22% 103,211 $9,088,608 VFX Visionflex Group Ltd 0.006 20% 143,580 $7,084,956 ELT Elementos Limited 0.125 19% 142,199 $20,447,709 MXO Motio Ltd 0.019 19% 280,212 $4,291,174 BVR Bellavistaresources 0.2 18% 458,311 $13,339,747 FOS FOS Capital Ltd 0.235 18% 12,987 $10,761,228 IG6 Internationalgraphit 0.084 17% 259,738 $13,936,200 BMO Bastion Minerals 0.007 17% 6,235,297 $2,610,503 IBG Ironbark Zinc Ltd 0.0035 17% 4,436,999 $4,781,618 ICG Inca Minerals Ltd 0.007 17% 337,271 $4,828,433 IPB IPB Petroleum Ltd 0.007 17% 500,000 $4,238,418 UNT Unith Ltd 0.014 17% 1,769,159 $14,681,248 PPY Papyrus Australia 0.015 15% 65,200 $6,405,004 ABX ABX Group Limited 0.047 15% 659,027 $10,251,653 SFX Sheffield Res Ltd 0.355 15% 293,825 $121,882,671 AUZ Australian Mines Ltd 0.008 14% 94,977 $9,789,585
It’s been a mixed bag of winners among the Small Caps for Thursday, with Baby Bunting (ASX:BBN) climbing a surprise 24% after delivering a trading update to investors, which included news that total sales from 1 May 2024 to 24 June 2024 were up a modest 1.0% on pcp, and that the company’s existing $70 million NAB facility has been renewed for a further 3 years at existing pricing.
Bellavista Resources (ASX:BVR) was up on news that the company has firm commitments for an unbrokered $1.2 million cap raise to new and existing shareholders and institutional investors, at $0.15 per share – a handy 12% discount to the company’s recent close at $0.17 a pop.
Bastion Minerals (ASX:BMO) released happy news that it has found more high-grade rare earths at its Gyttorp project in Sweden. Assays confirmed TREE+Y up to 8.3% from actinolite skarn, in line with previously announced xPRF results from the site.
And Sheffield Resources (ASX:SFX) announced results from a ramp up of production and shipments from the Kimberley Mineral Sands owned Thunderbird Mineral Sands Mine in Western Australia, which saw production of approximately 825,000 ore tonnes in June 2024, and concentrate production of approximately 55,000 tonnes ilmenite concentrate and 13,000 tonnes zircon concentrate over the same period.
ASX SMALL CAP LOSERS
Here are the most-worst performing ASX small cap stocks for 27 June [intraday]:
Swipe or scroll to reveal full table. Click headings to sort:
Code Company Price % Volume Market Cap CAQ CAQ Holdings Ltd 0.018 -63% 410,000 $35,171,528 CNJ Conico Ltd 0.001 -50% 90 $3,610,291 OAR OAR Resources Ltd 0.001 -50% 600,000 $6,444,200 MAY Melbana Energy Ltd 0.035 -43% 40,253,648 $205,582,450 BFC Beston Global Ltd 0.002 -33% 1,680,000 $5,991,141 JAV Javelin Minerals Ltd 0.001 -33% 248,000 $3,751,846 GES Genesis Resources 0.005 -29% 35,000 $5,479,889 BP8 Bph Global Ltd 0.003 -25% 2,280 $1,586,566 BUY Bounty Oil & Gas NL 0.003 -25% 2,850,365 $5,994,004 EDE Eden Inv Ltd 0.0015 -25% 392,981 $7,356,542 MTB Mount Burgess Mining 0.0015 -25% 156,666 $2,596,294 TMK TMK Energy Limited 0.003 -25% 21,371 $27,646,448 VPR Voltgroupltd 0.0015 -25% 2,006,732 $21,432,416 E33 East 33 Limited. 0.01 -23% 513,160 $10,077,391 IMM Immutep Ltd 0.3375 -22% 32,760,590 $631,886,346 OAK Oakridge 0.07 -21% 3,000 $2,402,814 IMI Infinitymining 0.012 -20% 25,000 $1,781,301 NSM Northstaw 0.012 -20% 1,038 $2,098,137 AMD Arrow Minerals 0.002 -20% 4,228,366 $26,348,413 BLZ Blaze Minerals Ltd 0.004 -20% 738,844 $3,142,791 GTR Gti Energy Ltd 0.004 -20% 2,032,496 $10,249,735 IS3 I Synergy Group Ltd 0.008 -20% 89,459 $3,540,804 MMM Marley Spoon Se 0.016 -20% 17,500 $2,354,488 SFG Seafarms Group Ltd 0.002 -20% 479,727 $12,091,498 WEL Winchester Energy 0.004 -20% 1,894,999 $5,102,110
ICYMI – AM EDITION
Mithril Resources (ASX:MTH) has received firm commitments for a $3.7m placement at a 29% premium. This includes a $2m, 10% cornerstone investment from Jupiter Gold and Silver Fund.
Norfolk Metals (ASX:NFL) has received a 30-day extension to the exclusivity deed relating to its acquisition of the Los Altares uranium project in Chebut, Argentina, from Green Shift Commodities.
The company now has the exclusive right lasting 105 days from 14 April 2024 to complete due diligence and negotiate terms for a formal, legally binding agreement for the acquisition of the project.
Los Altares is surrounded by several projects with non-JORC resources such as UR Americas’ Meseta Central deposit (19.1Mlbs eU308), CNEA’s Cerre Solo deposit (11.49Mlbs U308) and ISO Energy’s Laguna Salada deposit (10.1Mlbs U308 as well as the historical Cerro Condor and Los Aodobes uranium mines.
Race Oncology (ASX:RAC) is on track to start human trials after successful completion of Good Laboratory Practice toxicology and safety pharmacology studies for RC220, the company’s flagship formulation of bisantrene for peripheral intravenous infusion.
At Stockhead, we tell it like it is. While Mithril Resources, Norfolk Metals and Race Oncology are Stockhead advertisers, they did not sponsor this article.
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