The ASX 200 is on track to end the week around +1.4pc higher
Yup, it’s the goldies out in front again, thanks to subdued panic and rising prices
Who won the Small Caps race? Read on to find out…
It’s been a week of ups and downs since last Friday, with external international forces working cheek by jowl with local influencers to push the ASX forward on tremulous legs, staggering to a 1.4%(ish) rise like a newly born foal.
A bit’s happened this week, but most of the talk was around Jim Chalmers and his Incredible Bloated Budget Machine that landed in the nation’s capital on Tuesday night, and has been baffling economists, voters and the media ever since.
By far the most contentious part of the Chalmers Disaster, which I’ve called it because rhymes, and because it will 100% end up biting the Treasurer square on the arse, has been a $300 gift to all Australian households, so we can all keep the lights on at home.
Now – and please, don’t panic when I tell you this, but… I have spoken to actual people who know about how this sort of thing works, and here’s a basic summary of what a mess Chalmers has made of a golden opportunity.
On the face of it, the offer seems pretty generous – $300 per household, knocked off the top of the power bill, across the next financial year.
But it’s not means tested – so people who are really struggling are going to get the same cost of living relief as people who earn $300 every couple of seconds, rather than every few days.
And everyone lost their minds.
Amid the post-budget shouting and finger-pointing, Chalmers did his best to bellow over the top of the noise, struggling earnestly to counter the viewpoint that a cash splash like this will inevitably lead to upward pressure on inflation.
Chalmers got as far as screaming “It’s actually going to push inflation dow…” before he was carried off by the braying mob, and cast into the oceans to be consumed by the ravenous beasts of the sea.
The thing is, though… he’s right. $300 to a household in terms of actual cash money is not a lot, so the effect it’s likely to have is minimal – virtually nothing compared to historical cash splashing by Labor governments, which were (at the time) specifically designed to tweak the economy’s nipples and get things moving again.
The thing that Chalmers wasn’t able to articulate very well is that this is actually a plan to kneecap part of the nation’s CPI calculation, but it’s dressed up in a voter-friendly ‘cost of living relief’ package.
It is classic ALP “lipstick on a pig” politics, sure… but when you consider what an outsized effect household utilities have on CPI – probs the most famous inflation indicator we have at our disposal – Chalmers was aiming to get that $300 into the hands of as many people as possible.
The more he spends on that, the cheaper our power bills are going to be, and that will almost certainly knock a few points off any CPI rises over the course of the next financial year.
It’s sneaky, it’s smart, and it’s impossible to reduce into a single TV-friendly soundbite, which is why everyone hates it so much.
Also – having read back over this, I feel the need to acknowledge that I was among the rabble that got it wrong on Wednesday morning, and made fun of the “lazy” and indiscriminent spraying of cash over the entire community – a classic case of a little knowledge being a dangerous thing.
So, yeah… I said some stuff that was off the mark. But, in my defence, I say a lot of stuff – some of it I even actually mean – but this time round, I whiffed it. Mea Culpa, etc etc.
WHAT THE SECTORS DID
It was a bangin’ week for Consumer Discretionary, which started the week with a minor win and just kept on building momentum to finish the past 5 sessions well out in front of the rest of the market, up more than 3.0%.
The bulk of that rise came throughout Thursday’s session, with the sector piling on a very juicy 2.45% on a prize-winning day for local investors.
The Materials sector also outperformed, and that’s largely down to investors insatiable lust for gold, and the rumblings of what some analysts are suggesting could well be the end of a broad hibernation for metals, precious and otherwise, on commodity markets.
Saxo Bank’s Head of Commodity Strategy, a fella by the name of Ole Hansen, is getting pretty bullish about where the metals market is heading, pointing the recent run on silver and gold, and rapidly moving markets for commodities like Copper and Nickel as indicators that the form slump could well be over.
I like Ole Hansen, because even though I’m pretty sure that I’m pronouncing it wrong in my head, having someone whose name sounds like a grizzled prospector getting all excited about precious metals is wonderfully poetic.
Chart via Martketindex.com.au
A look at the ASX indices for the week shows very little in the way of surprises – mostly because we already know what happened, because we were there.
Unless you weren’t there, in which case… here’s what happened.
Chart via Martketindex.com.au
SMALL CAP WINNERS THIS WEEK
Code Company Price % Week Market Cap AGC AGC Ltd 0.275 178% $65,555,555 ERW Errawarra Resources 0.15 150% $16,306,514 BUR Burley Minerals 0.16 108% $22,555,642 FAU First Au Ltd 0.004 100% $6,647,973 VPR Volt Power Group 0.002 100% $21,432,416 PLC Premier1 Lithium Ltd 0.038 81% $6,459,241 ILT Iltani Resources 0.305 79% $11,563,572 ION Iondrive Limited 0.012 71% $5,835,423 EMS Eastern Metals 0.05 67% $4,121,312 RGL Riversgold 0.01 67% $8,708,953 IND Industrial Minerals 0.29 61% $20,628,000 CCZ Castillo Copper Ltd 0.008 60% $10,396,043 PNM Pacific Nickel Mines 0.04 60% $14,638,859 SUM Summit Minerals 0.18 57% $7,625,140 PH2 Pure Hydrogen Corp 0.165 53% $51,979,719 NC6 Nanollose Limited 0.032 52% $3,956,146 APC Aust Potash Ltd 0.0015 50% $4,000,189 CAQ CAQ Holdings Ltd 0.015 50% $10,766,794 MRD Mount Ridley Mines 0.0015 50% $15,569,766 PUA Peak Minerals Ltd 0.0045 50% $5,206,883 YPB YPB Group Ltd 0.003 50% $1,615,923 VR8 Vanadium Resources 0.06 46% $33,057,712 AUG Augustus Minerals 0.065 44% $5,122,200 SER Strategic Energy 0.013 44% $6,315,597 8VI 8Vi Holdings Limited 0.063 43% $2,514,685 G11 G11 Resources Ltd 0.04 43% $29,215,762 HLX Helix Resources 0.005 43% $9,292,583 PEC Perpetual Res Ltd 0.02 43% $11,520,530 CCO The Calmer Co International 0.007 40% $8,165,278 NKL Nickelx Ltd 0.028 40% $2,458,825 HRZ Horizon 0.053 39% $36,451,151 LTP LTR Pharma Limited 0.375 39% $23,585,838 KP2 Kore Potash PLC 0.018 38% $9,215,703 TOR Torque Met 0.2 38% $31,148,896 RCR Rincon 0.135 38% $25,553,625 WC1 Westcobar Metals 0.055 38% $7,215,720 TRJ Trajan Group Holding 1 37% $150,693,924 KLI Killi Resources 0.042 35% $3,068,502 VUL Vulcan Energy 5.38 35% $819,067,518 BM8 Battery Age Minerals 0.135 35% $11,011,238 EMC Everest Metals Corp 0.125 34% $22,178,220 IEC Intra Energy Corp 0.002 33% $5,072,345 KPO Kalina Power Limited 0.004 33% $12,431,970 RDS Redstone Resources 0.004 33% $3,701,514 RLC Reedy Lagoon Corp 0.004 33% $2,478,163 SI6 SI6 Metals Limited 0.004 33% $9,475,438 SRY Story-I Limited 0.004 33% $1,505,619 TMX Terrain Minerals 0.004 33% $5,010,847 NOX Noxopharm Limited 0.079 32% $22,794,560 TG1 Techgen Metals Ltd 0.05 32% $6,662,894
It’s been a big week among the small caps, with no less than four companies cracking through 100% gains since Monday morning.
Top of the charts was market newbie Sun Silver (ASX:SS1) , which made a stunning debut on Wednesday and was on track to finish its first three days on the bourse up +200%.
Running a close second Australian Gold and Copper (ASX:AGC), with the explorer soaring more than +180% on news that the company had drilled into thick, super high grade metal at Achilles, including a highlight 5m at 16.9g/t gold, 1,473g/t silver and 15% lead+zinc.
“Achilles is producing some exceptional grades in the drill bit,” AGC boss Glen Diemar said. “The first six holes have produced grades including combined lead and zinc to 38%, gold to 45g/t and silver above 3,000g/t. This silver result is so high grade the laboratory is sending the sample to Canada for further analysis, which is a rare occurrence.”
Errawarra Resources (ASX:ERW) had a curious, somewhat bumpy ride to +150% for the week, as it happened on the back of virtually nothing in the way of hard news for the company, and the run attracted some undesirable attention from the ASX watchdogs as a result.
Similarly, Burley Minerals (ASX:BUR) made a dash to +108% on no news, also catching a speeding ticket from the ASX, leading the company to theorise that it’s possibly down to investors feeling the love for iron ore explorers in the Pilbara region this week.
SMALL CAP LAGGARDS THIS WEEK
Code Company Price % Week Market Cap EDE Eden Innovations 0.001 -50% $7,356,542 JTL Jayex Technology Ltd 0.002 -50% $562,557 BFC Beston Global Ltd 0.003 -40% $7,988,188 HOR Horseshoe Metals Ltd 0.01 -38% $5,830,008 DMG Dragon Mountain Gold 0.007 -36% $2,762,702 AVW Avira Resources Ltd 0.001 -33% $2,663,790 CNJ Conico Ltd 0.001 -33% $1,805,095 CT1 Constellation Tech 0.001 -33% $1,474,734 MRQ MRG Metals Limited 0.001 -33% $2,525,119 MSI Multistack International 0.009 -31% $1,771,951 ICU Investor Centre Ltd 0.014 -30% $4,244,773 AXI Axiom Properties 0.046 -29% $19,472,115 NSX NSX Limited 0.017 -29% $7,561,137 PIL Peppermint Innovation 0.01 -29% $21,213,583 WOA Wide Open Agriculture 0.021 -28% $3,580,468 ADC ACDC Metals Ltd 0.052 -27% $2,580,370 SCN Scorpion Minerals 0.02 -26% $9,417,492 ERL Empire Resources 0.003 -25% $4,451,740 ICE Icetana Limited 0.018 -25% $4,763,312 LSR Lodestar Minerals 0.0015 -25% $4,046,795 OAR OAR Resources Ltd 0.0015 -25% $6,306,622 TGH Terragen 0.018 -25% $7,381,623 TX3 Trinex Minerals Ltd 0.003 -25% $5,440,957 WFL Wellfully Limited 0.003 -25% $1,478,832 WLD Wellard Limited 0.03 -25% $15,937,509 88E 88 Energy Ltd 0.003 -25% $86,678,016 BYE Byron Energy Ltd 0.045 -25% $47,466,561 FLC Fluence Corporation 0.115 -25% $145,284,937 NAC Naos Ex-50 0.575 -24% $24,679,419 ZLD Zelira Therapeutics 0.53 -24% $5,560,106 PTR Petratherm Ltd 0.023 -23% $5,394,027 ENL Enlitic Inc 0.4 -23% $31,485,851 NXS Next Science Limited 0.3 -23% $97,717,860 SGC Sacgasco Ltd 0.007 -22% $5,457,810 TAT Tartana Minerals Ltd 0.03 -21% $5,375,617 BPH BPH Energy Ltd 0.019 -21% $21,950,963 GEN Genmin 0.135 -21% $95,932,121 AD1 AD1 Holdings Limited 0.008 -20% $7,189,187 AIV Activex Limited 0.004 -20% $862,010 AL8 Alderan Resource Ltd 0.004 -20% $4,427,445 HIQ Hitiq Limited 0.016 -20% $6,333,209 OAU Ora Gold Limited 0.004 -20% $26,127,004 ROG Red Sky Energy 0.004 -20% $21,688,909 RR1 Reach Resources Ltd 0.012 -20% $9,618,745 TIG Tigers Realm Coal 0.004 -20% $52,266,809 WBT Weebit Nano Ltd 2.3 -20% $458,324,886 IMI Infinity Mining 0.055 -19% $7,125,203 AXN Alliance Nickel Ltd 0.051 -19% $37,017,820 L1M Lightning Minerals 0.074 -19% $4,026,078 CHL Camplify Holdings 1.22 -19% $86,515,422
HOW THE WEEK SHOOK OUT
Monday 13 May, 2024
Leading the ladder on Monday morning was Errawarra Resources (ASX:ERW) which jumped after saying that it has identified a “large, stacked pegmatite swarm” at its 100kkm2+ Andover West project, which is about 40km east-southeast of Karratha, WA, and just south of Azure Minerals’ (ASX:AZS) Andover LCT Pegmatite project (now owned by SQM/Hancock). Andover West has, notes the company, a highly promising exploration target of 100-240mt at 1-1.5% Li2O.
Elixinol Wellness (ASX:EXL) gained on news that it’s received $2.3m from divesting its minority stake in Altmed Pets.
Magnum Mining and Exploration (ASX:MGU) rose sharply after telling the market that it and Middle East for Metallic Industrial (Midmetal) have entered into an agreement with the Nasdaq-listed V Capital Consulting and 2×1.Digital to raise more than US$210m to advance a green pig iron project in Saudi Arabia. Additionally, Magnum is set to “receive no less than US$10m as working capital for its flagship Buena Vista magnetite project in Nevada for the issue, subject to Magnum shareholder approval”.
And Ramelius Resources (ASX:RMS)’s updated Mineral Resource Estimate, now including adjacent Lone Pine and Theakston deposits and incorporating recent drilling and mining information were: 21Mt at 1.7g/t for 1,200,000 ounces (up 64% on June 2023 MRE). This combines previous Mineral Resource Estimate of 730,000 oz and Exploration Target of 125,000-225,000 oz into a single resource, with the result well exceeding the upper end of the Exploration Target range, and also containing over 75% in either the Measured or Indicated categories.
Tuesday 14 May, 2024
TechGen Metals (ASX:TG1) was up on news that the company has expanded its portfolio to include “a highly prospective copper and gold project in Western Australia”. Techgen has snapped up the Blue Devil project, located 45km east northeast of Halls Creek in Western Australia and accessible through station and exploration tracks, for “minimal outlay”, after previous exploration at the site by Spartan Exploration returned some promising rock chip samples, above 1% Cu with a peak of 50.5% Cu.
It’s a timely purchase, as copper prices ticked back over US$10,000 a tonne overnight – which was also great news for Castillo Copper (ASX:CCZ) , which was up on news of plans to develop its Big One deposit in the Mt Isa copper belt. Located within CCZ’s prime NWQ Copper Project, the Big One Deposit has a JORC compliant Mineral Resource Estimate of 2.1Mt @ 1.1% Cu for 21,886t contained metal2, including 40m @ 1.64% from surface incl: 11m @ 4.40% from 24m, 5m @ 7.34% from 28m & 1m @ 16.65% from 29m, and 44m @ 1.19% Cu from surface incl: 14m @ 3.55% from 27m, 3m @ 10.88% from 37m & 1m @ 12.6% from 37m.
In more copper news, Stavely Minerals (ASX:SVY) was up after announcing that re-interpretation of historic and more recent drilling at the company’s Junction prospect has identified an immediate shallow discovery opportunity. Stavely says copper-gold-silver lode-style mineralisation intersected previously at Junction includes chalcopyrite, bornite and covellite and is very similar to the mineralisation at its 9.3Mt at 1.23% Cu, 0.23g/t Au, 7g/t Ag Cayley Lode.
Rincon Resources (ASX:RCR) was on the rise again after dramatically peaking and selling off about a week or so ago. The critical metals (REEs, niobium, copper, gold) junior was up today after revealing that a Heritage clearance survey over its high-priority ‘Avalon’ Nb-REE/IOCG target has now been completed. The survey encompassed the Avalon, Sheoak, K1 and K2 target areas, with 32 drilling traverses surveyed, allowing Rincon to fast-track additional drilling programs in the event of early success.
Junior gold explorer, First Au (ASX:FAU), has made a solid gain amid high trading volume. Something’s going on – investors might know, but here’s what we know. It’s a management/boardroom shuffle situation. Why that’s got investors frothing, though, is as yet not entirely clear. The company has announced the resignation of its current CEO and MD Ryan Skeen, which will take effect at the conclusion of FAU’s AGM on Thursday this week.
Wednesday 15 May, 2024
Market newbie Sun Silver (ASX:SS1) hit the ground sprinting on Wednesday morning, arriving on the ASX with a monstrous bang and climbing +125% at the close. The company owns the Maverick Springs silver project in Elko County, Nevada, which boasts an inferred mineral resource of 292Moz AgEq at 72.4g/t Ag.
Castillo Copper (ASX:CCZ) was also trading higher again this morning, building on the week’s early success – and cracking the $0.01 per share bracket for the first time since August last year – after the company delivered an investor prezzo in London.
The Calmer Co International (ASX:CCO) was up sharply after revealing that Aussies are going bananas for the smooth, natural sedation of kava.
CCO announced that sales of its products through Coles supermarkets are booming, exceeding $150k over the initial launch period and running at over $30k per week – that’s more than 4600 units per week – in week 8 after launch while online sales are also moving sharply, and currently exceed $11,000 per day.
Australian Gold and Copper (ASX:AGC) was bursting up today on… that’s right, you guessed it… silver. The company has announced it’s drilled its way into some thick, super high grade metal at its Achilles target, which is part of the gold and polymetallic project dubbed Cargelligo, located in the Cobar mineral basin of NSW. The high grade silver action includes a highlight of 5m at 16.9g/t gold, 1,473g/t silver and 15% lead+zinc.
Diverse minerals explorer, Cohiba Minerals (ASX:CHK), is back on the rise again after announcing yesterday that it’s all set to change its name and ticker – to Altair Minerals (ASX:ALR), which will take effect from Friday. The company has actually had some other news of reasonable note in the past week, announcing a strategic review of the Olympic Domain project, which the company says “adjoins one of the biggest IOCG discoveries”, and where it has “confirmed strong prospectivity for IOCG mineralisation, which warrants further investigation”.
Emerging copper-gold explorer/developer, Golden Deeps (ASX:GED), jumped after announcing that drilling is set to commence at the company’s 100%-owned Havilah Project to test a series of priority porphyry/volcanics hosted copper-gold targets. The company notes that an initial 6-10 reverse circulation and diamond holes (up to 2,500m) will be drilled to test large copper-gold sulphide targets associated with strong sub-surface Induced Polarisation (IP) geophysical anomalies.
And.. Argenica Therapeutics (ASX:AGN) says its drug ARG-007 significantly reduced damage to brain cells in a ferret animal model of mild to moderate traumatic brain injury (modTBI), a model that closely resembles the gross anatomy of the human brain. The observed therapeutic effects of ARG-007 in the modTBI model included a significant reduction in the accumulation of key proteins, and a significant reduction in the level of inflammation markers GFAP and Iba1.
Thursday 16 May, 2024
Market newbie Sun Silver (ASX:SS1) was continuing its run on the heels of Wednesday’s excellent debut, with investors continuing to pile on through Thursday, pushing its price higher by another +20%.
Likewise, investors were still pumped about Australian Gold and Copper’s (ASX:AGC) lab-breakingly dense silver discovery at its Achilles project, with intercepts in excess of 3,000g/t Ag that needed to be sent overseas because the local machines took one look and broke down crying.
Errawarra Resources (ASX:ERW) continues to be extremely buoyant despite repeated queries from the ASX asking for an explanation as to why the stock is so popular at the moment, in the absence of any market sensitive news.
And if you needed another indicator at just how hot copper is as a commodity right now, Helix Resources (ASX:HLX) was up quite a long way this morning after revealing to the market that a frill campaign has commenced to test a “highest priority” geophysics anomaly at the Canbelego copper project.
Junior explorer Riversgold (ASX:RGL) has all its golden ducks lined up at its highly prospective Northern Zone gold project, about 25km east of Kalgoorlie in Western Australia. More specifically, it has the drill rigs contracted (one reverse circulation, the other air core) and ready to spin hard into some hard rock next week. Earlier in the week, the company announced a placement of $1.85 million to help fund the step-out drilling program at the project, where its aim is to define a maiden, JORC-compliant gold resource.
Friday 17 May, 2024
Helix Resources (ASX:HLX) built on gains from earlier in the week on Friday morning, after announcing that a rights issue seeking to raise $2.3 million has closed heavily oversubscribed, with an extra $0.5 million likely to be accepted to meet the excess demand.
Nickel hunter Poseidon Nickel (ASX:POS) announced it has recommenced greenfields exploration activities at Lake Johnston, following a four-month hiatus whilst the company was focused on the Lake Johnston sales process.
In particular, the company says that it’s ready to start renewed exploration around numerous pegmatites identified near an “exciting broad, coherent >100ppm Li2O anomaly”, which the company already informed the market about in January of this year.
Power Minerals (ASX:PNN) was up on Friday morning on news that it has entered into a Binding Term Sheet and Convertible Loan Agreement for the strategic funding and development of the Rincon Project at its Salta Lithium Project in Argentina.
Power will receive initial strategic funding of US$5 million, in two tranches, from Singaporean entities Repenergy Investment Private and Legendary Star Investment Asia, alongside Chinese entity Li Energy Technology.
And Locality Planning Energy (ASX:LPE) was up Friday after announcing updated guidance to the ASX, telling investors that the company is now expecting a significant improvement in net profit to the range of $1.95m to $2.0m, and offereds EBITDA guidance between $3.3 million and $3.5 million, which is loads better than the company’s net loss of $12 million for FY23.
IPOs that happened
Sun Silver (ASX:SS1)
Listed: May 15, 2024
IPO:$13 million at 20 cents/share
The ASX hopeful is keen to be one of the few pure play silver companies on the bourse, and the company says it has reason to be confident about its flagship Maverick Springs project in Elko County, Nevada.
The project hosts a JORC-compliant inferred resource of 292Moz of silver equivalent at an average grade of 72.4g/t within the Carlin trend – a deep penetrating fault that is known for Permian host rocks great for mining and processing.
The immediate region is also known to have a number of operating gold and silver mines including Coeur’s Rochester mine. Nevada is also well known around the world as a top tier mining jurisdiction.
The company’s debut made a significant splash, and it was set to round out its first three days on market up +200%… what a welcome to the ASX that was.
The post ASX Small Caps and IPO Weekly Wrap: The ASX is fired up and feisty as metals make a comeback appeared first on Stockhead.
