Evening Wrap: ASX 200 dips on another hit to energy and mining stocks, uranium and gold fare worst

I propose the key message to take away from today's trade on the ASX is: It could have been worse.

We didn't fall as much as US stock indices did overnight (they were generally down over 1%), and we managed to close around 0.5% above our low.

Still, it really depends on how your portfolio is skewed as to how you viewed today's trade. If you're in banks and financials, particularly AMP (+13%), along with other defensive sectors like Consumer Staples and Utilities – you probably thought today was a cracker.

If on the other hand, your portfolio is skewed more to Energy and Mining names, particularly in uranium and gold...well...it's crackers for dinner for you this Thursday night! 😭

On that note...

Let's dive in!

Markets

ASX 200 Session Chart

The S&P/ASX 200 (XJO) finished 17.8 points lower at 7,682.0, 0.49% from its session low and just 0.28% from its high. In the broader-based S&P/ASX 300 (XKO), advancers lagged decliners by a dismal 91 to 179.

The Financials (XFJ) (+1.0%) was the best performing sector today, likely in response to the 13.2% pop in AMP (ASX: AMP) following the release of its first half results. Underlying profit rose 5.4% with particularly strong performances at its Platforms and Super/Investments business. Outside of AMP, it was good to see a rebound in banking stocks, with each of the Big 4 notching gains of around 1%.

Other relatively defensive sectors like Consumer Staples (XSJ) (+0.49%), Utilities (XUJ) (+0.31%) and Health Care (XHJ) (+0.03%) also squeaked into the black. Consumer Discretionary (XDJ) (+0.29%) and Information Technology (XIJ) (+0.05%) rounded out the list of winning sectors.

The best performing stocks from the best performing ASX sectors today

Losses were concentrated in Gold (XGD) (-2.9%), Real Estate Investment Trusts (XPJ) (-2.0%), Resources (XJR) (-1.8%), and Energy (XEJ) (-1.2%).

Mirvac Group (ASX: MGR) was the major drag in Real Estate after it dipped 9% on its full year FY24 results. It’s profits were down 5% as margins came under pressure in key markets New South Wales and Queensland.

Another 1.8% shaved off Woodside Energy Group (ASX: WDS) shares hurt the energy sector, but the sector was also weighed down by another sharp drop in several key uranium names.

In Resources, iron ore and copper producers bore the brunt of the selling as prices of those two key commodities continue to fall (see ChartWatch for technical analysis), and gold stocks took another hit as the gold price continues to underperform during an apparent financial markets crisis.

ASX Energy and Resources stocks today.

ChartWatch

Iron Ore 62% (Front month, back-adjusted) SGX

That sinking feeling again...

The last time we covered iron ore was in ChartWatch in the Evening Wrap on 1 August.

In that update, we were tracking well established short and long term downtrends. Unfortunately, very little has changed since then – unless you count the fact that those trends continue to put extreme pressure on the 94.00-99.20 demand zone.

105.75 has moved to supply, and it’s backed up by the dynamic supply of the short term downtrend ribbon.

98.10 is short term demand. A close below it could pave the way for a test of 94, and if current trends are anything to go by, a possible eventual break.

The short term downtrend remains intact until the iron ore price can close at least back above 105.75. Until we see the customary fingerprints of demand – white-bodied candles and or downward pointing shadows, plus a return to rising peaks and rising troughs – there’s no reason to doubt the status quo here.

High Grade Copper Futures (Front month, back-adjusted) COMEX

All gone...like the big copper trade of 2024 never happened...

The last time we covered high grade copper was in ChartWatch in the Evening Wrap on 29 July.

In that update, we pegged the key point of demand at 4.32 as the likely delineator between long term uptrend and long term downtrend.

History shows which option the demand-supply environment took.

Kind of a ditto on iron ore here. Copper is now probing some very important points of historical demand, and if it can’t find some strong demand-side candles here, and very soon, there’s every reason to believe the prevailing short and long term trends will force the price towards 3.825, and possibly even 3.684.

The short term trend remains intact until a close above the confluence of the short and long term trend ribbons and the static 4.224 point of supply.

Economy

Today

• There weren't any major data releases in our time zone today

Later this week

Friday

• 11:30 CHN Consumer Price Index (CPI) July (+0.3% p.a. forecast vs +0.2% p.a. in June)

• 11:30 CHN Producer Price Index (PPI) July (-0.9% p.a. forecast vs +0.2% p.a. in June)

Latest News

Interesting Movers

Trading higher

• +13.3% AMP (AMP) - AMP 1H 24 Results and 1H 24 Investor Presentation, rise is consistent in prevailing short and long term uptrends 🔎📈

• +7.1% Audinate Group (AD8) - Modest bounce after 6 Aug FY24 Preliminary Unaudited Results & FY25 Outlook triggered a >50% plunge in share price at the open

• +4.6% Hansen Technologies (HSN) - No news

• +4.1% Droneshield (DRO) - No news

• +3.7% Pantoro (PNR) - No news since 5 Aug Diggers & Dealers Presentation 2024

• +3.5% WA1 Resources (WA1) - No news since 5 Aug Diggers & Dealers Mining Forum Presentation

• +3.2% Spartan Resources (SPR) - No news since 7 Aug Diggers and Dealers - Corporate Presentation, rise is consistent in prevailing short and long term uptrends 🔎📈

• +3.0% Red 5 (RED) - Strong returns generated from simplified capital structure

Trading lower

• -11.1% Wildcat Resources (WC8) - No news since 5 Aug WILDCAT AT DIGGERS AND DEALERS, lithium prices continue to fall in China today, lithium carbonate futures hit a record low and closed below CNY80,000 for the first time, fall is consistent in prevailing short and long term downtrends 🔎📉

• -10.8% West African Resources (WAF) - Burkina Faso Adopts New Mining Code

• -10.7% Adriatic Metals (ADT) - Executive Management Changes and Final Director's Interest Notice, fall is consistent in prevailing short and long term downtrends 🔎📉

• -9.0% Mirvac Group (MGR) - MGR FY24 Results Presentation and MGR FY24 Annual Report

• -8.9% Fenix Resources (FEX) - No news since 5 Aug Diggers and Dealers Mining Forum Presentation, weaker iron ore price today

• -8.7% Botanix Pharmaceuticals (BOT) - No news

• -7.2% Resolute Mining (RSG) - No news, generally tough day for ASX gold sector

• -7.1% Myer (MYR) - Trading Update for FY24

• -6.3% Baby Bunting Group (BBN) - No news, fall is consistent in prevailing short and long term downtrends 🔎📉

• -6.0% Sandfire Resources (SFR) - No news, weaker copper price Wednesday in London and on COMEX

• -5.7% Westgold Resources (WGX) - No news, generally tough day for ASX gold sector

• -5.6% Deep Yellow (DYL) - No news, generally tough day for ASX uranium sector, fall is consistent in prevailing short and long term downtrends 🔎📉

• -4.9% Perseus Mining (PRU) - No news, generally tough day for ASX gold sector

• -4.8% Appen (APX) - Pullback after recent strong run

• -4.7% Weebit Nano (WBT) - No news, fall is consistent in prevailing short and long term downtrends 🔎📉

• -4.6% Alkane Resources (ALK) - Large Cu-Zn-Pb-Ag Targets Confirmed at the Rockley Project, fall is consistent in prevailing short and long term downtrends 🔎📉

• -4.4% Lotus Resources (LOT) - No news, generally tough day for ASX uranium sector, fall is consistent in prevailing short and long term downtrends 🔎📉

• -4.4% De Grey Mining (DEG) - No news, generally tough day for ASX gold sector

• -4.3% Chalice Mining (CHN) - No news, fall is consistent in prevailing short and long term downtrends 🔎📉

• -4.3% Tabcorp (TAH) - No news, fall is consistent in prevailing short and long term downtrends 🔎📉

• -4.3% Silex Systems (SLX) - No news, generally tough day for ASX uranium sector, fall is consistent in prevailing short and long term downtrends 🔎📉

• -4.2% Syrah Resources (SYR) - No news, fall is consistent in prevailing short and long term downtrends 🔎📉

• -4.0% Boss Energy (BOE) - No news, generally tough day for ASX uranium sector, fall is consistent in prevailing short and long term downtrends 🔎📉

Broker Notes

Audinate Group (AD8)

• Upgraded to outperform from neutral at Macquarie; Price Target: $10.50 from $14.40

• Retained at buy at UBS; Price Target: $10.90 from $22.80

Amcor (AMC)

• Upgraded to overweight from neutral at Jarden; Price Target: $16.35 from $14.80

AMP (AMP)

• Retained at buy at Citi; Price Target: $1.25

Brickworks (BKW)

• Downgraded to neutral from buy at UBS; Price Target: $30.00 from $32.50

Car Group (CAR)

• Retained at buy at Citi; Price Target: $39.30 from $39.80

Commonwealth Bank of Australia (CBA)

• Retained at sell at Ord Minnett; Price Target: $95.00

Charter Hall Long Wale Reit (CLW)

• Retained at neutral at Citi; Price Target: $3.50

Coronado Global Resources (CRN)

• Retained at outperform at Macquarie; Price Target: $2.10

Downer EDI (DOW)

• Retained at neutral at Macquarie; Price Target: $4.86 from $4.90

GQG Partners (GQG)

• Retained at buy at UBS; Price Target: $3.25

Gentrack Group (GTK)

• Initiated at overweight at Morgan Stanley; Price Target: $12.80

Guzman y Gomez (GYG)

• Initiated at overweight at Morgan Stanley; Price Target: $31.80

Highcom (HCL)

• Retained at buy at Bell Potter; Price Target: $0.35

Iluka Resources (ILU)

• Retained at equal-weight at Morgan Stanley; Price Target: $6.75 from $6.70

Janison Education Group (JAN)

• Retained at buy at Shaw and Partners; Price Target: $0.33 from $0.70

James Hardie Industries (JHX)

• Retained at buy at UBS; Price Target: $60.00

Arcadium Lithium (LTM)

• Retained at buy at Citi; Price Target: $6.50 from $9.40

• Retained at outperform at Macquarie; Price Target: $6.60

Meteoric Resources (MEI)

• Initiated at buy at Ord Minnett; Price Target: $0.20

Mirvac Group (MGR)

• Retained at neutral at Citi; Price Target: $2.10

Neuren Pharmaceuticals (NEU)

• Retained at buy at Bell Potter; Price Target: $25.00 from $28.00

Northern Star Resources (NST)

• Retained at equal-weight at Morgan Stanley; Price Target: $14.35 from $13.70

Nextdc (NXT)

• Retained at buy at Citi; Price Target: $19.25 from $19.75

Patriot Battery Metals (PMT)

• Retained at buy at Shaw and Partners; Price Target: $1.80

Premier Investments (PMV)

• Retained at buy at UBS; Price Target: $36.00

Qantas Airways (QAN)

• Retained at outperform at Macquarie; Price Target: $6.30 from $6.00

REA Group (REA)

• Upgraded to buy from hold at Bell Potter; Price Target: $218.00 from $203.00

Reece (REH)

• Retained at sell at UBS; Price Target: $20.50 from $18.00

Resimac Group (RMC)

• Retained at buy at Bell Potter; Price Target: $1.30

Regis Resources (RRL)

• Retained at overweight at Morgan Stanley; Price Target: $1.85 from $1.90

Reliance Worldwide Corporation (RWC)

• Retained at buy at UBS; Price Target: $5.90 from $6.50

South32 (S32)

• Retained at equal-weight at Morgan Stanley; Price Target: $2.95 from $3.05

Spark New Zealand (SPK)

• Downgraded to neutral from overweight at Jarden; Price Target: NZ$4.67

Block (SQ2)

• Retained at buy at UBS; Price Target: $100.00

Transurban Group (TCL)

• Retained at buy at Citi; Price Target: $14.30

Viridis Mining and Minerals (VMM)

• Initiated at hold at Ord Minnett; Price Target: $1.00

Woodside Energy Group (WDS)

• Retained at neutral at Citi; Price Target: $28.00

Scans