Evening Wrap: ASX 200 ekes gain on strong Consumer, Banking stocks, as Lithium and Rare Earths run comes to crushing end

The S&P/ASX 200 closed 21.8 points higher, up 0.25%.

Aussie stocks were pushed and pulled in opposite directions today as investors chose to switch to defense. This means cash flowing into interest rate sensitive Consumer, Real Estate, Financial, and Utilities names (rates are coming down).

That cash had to come from somewhere, of course, and the opposite of defense is ‘cyclical and high-PE’. So, we saw sectors like Resources, Energy, and Information Technology struggle.

Of particular note in today’s gyrations – was a massive hit to the share prices of James Hardie Industries (JHX) (-28%) (earnings inflicted), and most critical minerals stocks (commodity price and hot money moving out inflicted).

The latter, saw the likes of Pilbara Minerals (PLS) (-7.9%), and Lynas Rare Earths (LYC) (-7.4%) harshly dealt with. The reason? Reasons were hard to find today… but I do note a massive drop in benchmark lithium carbonate futures ⚠️.

To make sense of all the above, I have detailed technical analysis on the Nasdaq Composite (plus NVIDIA Corp and Palantir Technologies), the S&P/ASX 200, and GFEX Lithium Carbonate in today's ChartWatch.

Be sure to click/scroll through for the usual reporting of the major sector and stock-specific moves, the broker responses to them, as well as all the key economic data in tonight's Evening Wrap.

Let's dive in!

Markets

ASX 200 Session Chart

The S&P/ASX 200 (XJO) finished 21.8 points higher at 8,918, a tidy 0.68% from its session low, but still 0.36% adrift from its high. Despite the firmer close on the benchmark, in the broader-based S&P/ASX 300 (XKO) advancers lagged decliners by a modest 122 to 152.

This is the Evening Wrap, not the Morning Wrap, so you already know that US stocks were down overnight, led by the tech-heavy NASDAQ Composite (“the Comp”) which fell 1.5%. In contrast, though, the benchmark S&P 500 lost a more modest 0.6%, up a little from its intra-day low.

Within the benchmark, I note the Information Technology sub-sector was down 1.9% – but there were decent offsets in more defensive sectors like Real Estate, Utilities, and Consumer Staples – which each logged gains in excess of 1%.

Yes, yes, Evening Wrap Carl, do get on with it – I still have to attend to my Duolingo streak!

Okay, well look at the sectors that did well/didn’t do well locally today.

Well: Consumer Discretionary (XDJ) (+1.9%), Real Estate (XPJ) (+0.8%), Financials (XFJ) (+1.4%), and Consumer Staples (XSJ) (+0.8%).

Not Well: Information Technology (XIJ) (-1.3%), Energy (XEJ) (-1.2%), Resources (XJR) (-1.1%).

There are some outliers, mainly relating to the fact that they’re the biggest parts of our market, like Financials (also defensive though – so it was up), and Energy and Resources (cyclical, and like the XIJ, so they typically live in the ‘risk off’ basket).

So, today wasn’t a write off, and probably was never going to be one.

Now, if all I’ve convinced you is that we basically just follow the same themes that drove US markets overnight – then I've probably only convinced you of something you already knew! But, hey, sometimes it’s nice to put 2 and 2 together and get 4, right? 😁

Okay, okay, get back to your bloody Duolingo (bazing!)

Today's best blue chip gainers

Look at all of those +2% gains! 🧐 The Lottery Corporation (TLC) and APA Group (APA) were on the back of results, but check out those banks – they are once again bench pressing the index!

So, clearly there was plenty of strength out there today – one just had to be in the anointed sectors.

Today's worst blue chip losers

James Hardie Industries (JHX) is the clear outlier here, again results inflicted, but the other key theme was the substantial cooling in critical minerals names (lithium and rare earths). There was scant news across the cohort, with the likely trigger a "limit down" move in benchmark GFEX lithium carbonate futures today. That means the exchange halted trading after an 8% decline. Check ChartWatch below for new technical analysis on GFEX lithium.

ChartWatch

Nasdaq Composite Index

Nasdaq Composite Index chart (click here for full size image)

For those who’ve been keeping track, yes indeed, that is the 12th alternation in candle body colour for a string of what is now of 13 zebra candles 🦓!

It kinda feels like US investors are a little confused at the moment – and indeed after last night’s decline the net move over the last couple of weeks amounts to nil. Lots of churn for very little result – either way.

In yesterday’s update I noted a drift in the last few candles, small bodies and below average volumes – fairly typical of late-August holiday trade. Add in this weekend’s risk events (Fed Meeting Minutes Thursday and Jackson Hole on the weekend), and it likely makes for similar churn for the rest of this week.

The candles and volume (lack thereof) tell us that neither the demand nor the supply side wants to commit in any great size just yet. Could the demand-side not commit for a more sinister reason last night? Lack of capital due to being fully invested? 🤔

These are questions that we require a few more candle/volume combinations to answer. But, certainly, yesterday’s longish and full-black-bodied showing is not a great look.

Basically, a ‘bit of supply’ took out ‘even less demand’ (again, volume tells us is wasn’t ‘a lot’). We closed below 21458 – also not ideal.

Consider though, that much of the Comp’s Tuesday decline came down to two stocks, Nvidia which fell 3.5% (down another 1% after hours), and software analytics/AI darling Palantir dumped 9.4% (down another 3.2% after hours).

NVIDIA Corporation (NVDA) chart (click here for full size image)

Nvidia moved on comments by US Treasury Secretary Scott Bessent, who in a CNBC interview, changed some of his rhetoric around selling new chip variants to China (previously stated as requiring a 15% revenue kickback to the US government!).

Palantir has been on a tear lately, and succumbed to reports that a well-known short seller was active...

Palantir Technologies Inc. (PLTR) chart (click here for full size image)

Yes, I have digressed from simply reading the candles, and I will return, but we do often consider market breadth here, as well as the contribution of outlying factors.

Let’s call a spade a spade, or a supply-side candle a supply-side candle as it were – and commit to now being on our toes. Perhaps just cool it a little tonight on adding new US exposure… really scrutinise existing exposure… and perhaps see if there are any juicy charts out there for some short cover.

But, given broader short and long term trends and price action remain intact, I personally remain at: Stay the course, FRP.

S&P/ASX 200 (XJO)

S&P/ASX 200 chart (click here for full size image)

Perhaps reflecting some of those “mitigating circumstances” discussed above, the Golden Le Creuset punched out a gain today – albeit a bit of a wobbly one looking those upward and downward pointing candle shadows!

All things considered, I’m going to call it a win for the demand-side, or at the very least, a lack of one for the supply-side who really had a reason/chance to make an impact today – but didn’t.

Today’s lower low and lower high sets 8963 as our new point of supply. The short term uptrend ribbon remains the critical zone of (dynamic) demand – presently at 8745-8810.

Short and long term trend, price action, and broader candle picture remain firmly set to demand-side control, therefore, there’s no change in my view: Stay the course, FRP.

Lithium Carbonate Futures (Benchmark month, back-adjusted) GFEX

Get out the popcorn! 🍿 (click here for full size image)

The phrase “Harder to pick than a broken nose” comes to mind here. Little has gone to plan with this trend reversal as far as my technical model is concerned – but that’s how the cookie crumbles (or the nose breaks!) sometimes.

It has been a tough one to pick, and today’s gap and run massive supply-side candle confirms the 87330-91380 supply zone as a major overhead obstacle to contend with.

I may well get that pullback and test of the long term uptrend ribbon I so dearly wanted as per our last update here on 12-Aug. As I noted in that update, “supply-side responses in fledgling bull markets aren't a bad thing, quite the opposite – they allow us to see how strong the demand-side really is.”

What we witnessed today is a powerful and convincing supply-side display – and it is just as concerning that the demand-side was either powerless to stop it, or that they simply preferred to stay out of the way. Looking at today’s volume of 839k – considering it was a substantially abbreviated session – my vote is with powerless to stop it!

That’s a decent whack of volume, which suggests that the demand-side did at least to some extent get in the way today with some bids, but were hit, and hit. The supply-side wanted out at any price.

What does that say about the supply-side’s motivation (how much more do they have if they are so careless about price?), and what does it say about the demand-sides sudden impotence (given that they were monstering price action only just a couple of candles ago)?

This is a concerning development, and a similar to the Comp alertness pique is required here I suggest! The good news is that we’ll get our answer soon: New Bull or Blip in an ongoing Bear? The price action at the short and long term trend ribbons will tell!

You know the drill vis-à-vis demand -or supply-side candles in that zone (long white-bodied and or long downward pointing shadows = Likely New Bull vs long black-bodied and or long upward pointing shadows = Blip in an ongoing Bear).

Exciting and fascinating stuff! Get out the popcorn! 🍿

Economy

Today

• CHN 1-year & 5-year Prime Loan Rate

  • No change to either forecast (1-year 3.0% forecast and 5-year 3.5% forecast)

Later this week

Thursday

• 04:00 July 29-30 FOMC meeting minutes

• 17:15 (from) EU Various July Flash Manufacturing and Services Sectors PMIs

• 23:45 USA July Flash Manufacturing and Services Sectors PMIs

Friday

• 00:00 USA Jackson Hole Symposium Day 1

Saturday

• 00:00 USA Federal Reserve Chairman Jerome Powell speaks at Jackson Hole Symposium Day 2

Latest News

Interesting Movers

Trading higher

• +24.0% Lynch Group (LGL) – FY25 results.

• +17.7% HMC Capital (HMC) – No news, upgraded to buy from hold at Morgans, rebounded after yesterday's sharp sell-off due to FY25 Results.

• +11.6% Centuria Capital Group (CNI) – Continued positive response to 19-Aug FY25 Results, rise is consistent with prevailing short and long term uptrends, a regular in ChartWatch ASX Scans Uptrends list 🔎📈

• +11.0% Sunrise Energy Metals (SRL) – No news, rise is consistent with prevailing short and long term uptrends, a regular in ChartWatch ASX Scans Uptrends list 🔎📈

• +7.9% Service Stream (SSM) – FY2025 Results, rise is consistent with prevailing short and long term uptrends, a regular in ChartWatch ASX Scans Uptrends list 🔎📈

• +7.8% Benz Mining Corp. (BNZ) – New Discovery Strengthened with Broad Gold Intercepts and Becoming a substantial holder, rise is consistent with prevailing short and long term uptrends, a regular in ChartWatch ASX Scans Uptrends list 🔎📈

• +7.7% Strickland Metals (STK) – Completion of Acquisition ofYandal Gold Project from STK.

• +7.5% Platinum Asset Management (PTM) – No news, rise is consistent with prevailing short term uptrend and long term trend is transitioning from down to up, a recent regular in ChartWatch ASX Scans Uptrends list 🔎📈

• +7.0% The Lottery Corporation (TLC) – FY25 Results, rise is consistent with prevailing short and long term uptrends 🔎📈

• +7.0% Stockland (SGP) – FY25 Results, rise is consistent with prevailing short and long term uptrends, a regular in ChartWatch ASX Scans Uptrends list 🔎📈

• +6.9% Energy One (EOL) – FY 2025 Investor Presentation, rise is consistent with prevailing short and long term uptrends, a regular in ChartWatch ASX Scans Uptrends list 🔎📈

• +6.3% SRG Global (SRG) – Continued positive response to 19-Aug N, rise is consistent with prevailing short and long term uptrends, a regular in ChartWatch ASX Scans Uptrends list 🔎📈

Trading lower

• -27.8% James Hardie Industries (JHX) – Q1 FY26 Results.

• -25.5% Step One Clothing (STP) – FY25 Results, fall is consistent with prevailing short and long term downtrends, a regular in ChartWatch ASX Scans Downtrends list 🔎📉

• -13.6% Arafura Rare Earths (ARU) – Completion of A$80m Placement and Launch of A$5m SPP and Investor Presentation.

• -13.5% Elsight (ELS) – No news, general weakness across the broader Defence sector today, (plenty of heat coming out of some hot plays from over the last few weeks!).

• -13.1% Electro Optic Systems (EOS) – No news, general weakness across the broader Defence sector today.

• -12.6% MTM Critical Metals (MTM) – No news, general weakness across the broader Critical Minerals sector today.

• -11.5% Aml3d (AL3) – No news 🤔.

• -11.4% Yancoal Australia (YAL) – Cash Dividend Announcement and 1H 2025 Financial Results.

• -11.3% Clarity Pharmaceuticals (CU6) – No news 🤔.

• -11.0% Droneshield (DRO) – No news, general weakness across the broader Defence sector today.

• -10.3% Unico Silver (USL) – Successful $25m Placement and Investor Presentation.

• -10.2% Develop Global (DVP) – No news, general weakness across the broader Critical Minerals sector today.

• -10.0% Meteoric Resources (MEI) – No news, general weakness across the broader Critical Minerals sector today.

• -9.3% Viridis Mining and Minerals (VMM) – Colossus Delivers Outstanding 200.6Mt Maiden Ore Reserve, general weakness across the broader Critical Minerals sector today.

• -8.0% Avita Medical (AVH) – No news, fall is consistent with prevailing short and long term downtrends, a regular in ChartWatch ASX Scans Downtrends list 🔎📉

• -8.0% Ioneer (INR) – No news, general weakness across the broader Critical Minerals sector today.

• -8.0% Nanoveu (NVU) – No news 🤔.

• -7.9% Pilbara Minerals (PLS) – No news, general weakness across the broader Critical Minerals sector today.

• -7.9% Wildcat Resources (WC8) – No news, general weakness across the broader Critical Minerals sector today.

Broker Moves

The a2 Milk Company (A2M)

• Upgraded to buy from neutral at Citi; Price Target: $9.29 from $8.20

Apiam Animal Health (AHX)

• Downgraded to hold from buy at Canaccord Genuity; Price Target: $0.88 from $0.63

Ampol (ALD)

• Retained at neutral at Macquarie; Price Target: $30.25 from $28.15

APA Group (APA)

• Retained at outperform at Macquarie; Price Target: $8.14

• Retained at sell at UBS; Price Target: $7.50

ARB Corporation (ARB)

• Retained at buy at Citi; Price Target: $45.17 from $38.70

• Retained at outperform at Macquarie; Price Target: $44.90 from $43.70

• Retained at overweight at Morgan Stanley; Price Target: $44.00 from $40.00

• Retained at accumulate at Morgans; Price Target: $44.50 from $38.25

• Retained at buy at Ord Minnett; Price Target: $42.00 from $37.00

Austal (ASB)

• Retained at hold at Bell Potter; Price Target: $6.75 from $5.60

Aurizon Holdings (AZJ)

• Retained at neutral at JPMorgan; Price Target: $3.50 from $3.40

• Retained at neutral at Macquarie; Price Target: $3.34 from $3.31

• Retained at sector perform at RBC Capital Markets; Price Target: $3.20

BHP Group (BHP)

• Retained at neutral at Barrenjoey; Price Target: $42.50 from $41.00

• Downgraded to neutral from buy at Citi; Price Target: $43.00

• Retained at neutral at Macquarie; Price Target: $43.00 from $41.00

• Downgraded to hold from accumulate at Morgans; Price Target: $43.90

• Retained at accumulate at Ord Minnett; Price Target: $42.50 from $41.00

• Retained at neutral at UBS; Price Target: $42.00 from $40.00

Beach Energy (BPT)

• Retained at underperform at Macquarie; Price Target: $0.95

Breville Group (BRG)

• Retained at neutral at Citi; Price Target: $32.10

• Retained at sector perform at RBC Capital Markets; Price Target: $32.00

BlueScope Steel (BSL)

• Retained at underperform at CLSA; Price Target: $20.50 from $22.00

• Retained at neutral at Jarden; Price Target: $24.50 from $25.00

• Retained at buy at Jefferies; Price Target: $28.00 from $29.00

• Retained at outperform at RBC Capital Markets; Price Target: $28.00 from $28.25

Bravura Solutions (BVS)

• Retained at neutral at Macquarie; Price Target: $2.03 from $3.17

Challenger (CGF)

• Retained at buy at Bell Potter; Price Target: $9.50 from $9.25

• Downgraded to hold from buy at Jefferies; Price Target: $8.35 from $7.60

• Retained at underweight at Morgan Stanley; Price Target: $6.90 from $6.60

• Retained at buy at UBS; Price Target: $9.30 from $9.15

Centuria Capital Group (CNI)

• Upgraded to buy from hold at Bell Potter; Price Target: $2.40 from $1.80

• Downgraded to underperform from neutral at Macquarie; Price Target: $2.04 from $1.79

• Retained at overweight at Morgan Stanley; Price Target: $2.20

• Retained at neutral at UBS; Price Target: $2.10 from $1.81

Coles Group (COL)

• Retained at buy at UBS; Price Target: $23.50 from $24.00

CSL (CSL)

• Downgraded to hold from buy at Bell Potter; Price Target: $240.00 from $305.00

• Retained at buy at Citi; Price Target: $300.00 from $335.00

• Retained at overweight at Morgan Stanley; Price Target: $291.00 from $303.00

• Retained at buy at UBS; Price Target: $300.00 from $310.00

Cleanaway Waste Management (CWY)

• Retained at outperform at RBC Capital Markets; Price Target: $3.40

Deterra Royalties (DRR)

• Retained at neutral at Barrenjoey; Price Target: $4.40 from $4.30

• Retained at buy at Canaccord Genuity; Price Target: $5.00 from $4.90

• Downgraded to neutral from overweight at JPMorgan; Price Target: $4.60

• Downgraded to neutral from outperform at Macquarie; Price Target: $4.20

Develop Global (DVP)

• Downgraded to hold from speculative buy at Canaccord Genuity; Price Target: $4.40 from $4.95

Dexus (DXS)

• Retained at buy at UBS; Price Target: $8.84

EVT (EVT)

• Downgraded to accumulate from buy at Ord Minnett; Price Target: $18.94 from $17.89

HMC Capital (HMC)

• Upgraded to buy from hold at Morgans; Price Target: $4.20

• Retained at buy at UBS; Price Target: $7.14 from $8.00

Hansen Technologies (HSN)

• Retained at outperform at RBC Capital Markets; Price Target: $6.50

• Retained at buy at UBS; Price Target: $7.00

HUB24 (HUB)

• Retained at buy at Bell Potter; Price Target: $125.00 from $115.00

• Retained at neutral at Macquarie; Price Target: $103.30 from $95.90

• Retained at overweight at Morgan Stanley; Price Target: $115.00

• Downgraded to neutral from buy at UBS; Price Target: $112.00 from $105.00

Judo Capital Holdings (JDO)

• Retained at neutral at Citi; Price Target: $1.85 from $1.60

• Retained at outperform at Macquarie; Price Target: $1.90 from $1.80

• Retained at overweight at Morgan Stanley; Price Target: $2.15 from $2.10

• Retained at buy at UBS; Price Target: $2.20

James Hardie Industries Plc (JHX)

• Retained at sector perform at RBC Capital Markets; Price Target: $41.00

LendLease Group (LLC)

• Retained at hold at CLSA; Price Target: $6.14 from $5.69

• Retained at neutral at JPMorgan; Price Target: $6.50 from $6.00

• Retained at equal-weight at Morgan Stanley; Price Target: $6.58 from $7.12

Monadelphous Group (MND)

• Upgraded to hold from sell at Bell Potter; Price Target: $19.50 from $16.50

• Retained at outperform at Macquarie; Price Target: $22.17 from $18.83

• Upgraded to buy from accumulate at Morgans; Price Target: $24.40 from $19.50

• Retained at neutral at UBS; Price Target: $21.00 from $16.00

Metcash (MTS)

• Retained at buy at UBS; Price Target: $4.25

Oohmedia (OML)

• Retained at neutral at Goldman Sachs; Price Target: $1.55 from $1.60

• Retained at overweight at JPMorgan; Price Target: $1.75 from $1.85

Region Group (RGN)

• Retained at buy at Bell Potter; Price Target: $2.70 from $2.65

• Downgraded to underperform from neutral at Macquarie; Price Target: $2.21 from $2.16

• Retained at neutral at UBS; Price Target: $2.40 from $2.35

Reliance Worldwide Corporation (RWC)

• Retained at buy at Citi; Price Target: $5.00 from $5.25

• Retained at outperform at CLSA; Price Target: $5.30 from $5.50

• Retained at buy at Jefferies; Price Target: $5.15 from $5.50

• Downgraded to neutral from overweight at JPMorgan; Price Target: $4.35 from $5.25

• Retained at outperform at Macquarie; Price Target: $5.30 from $5.55

• Retained at equal-weight at Morgan Stanley; Price Target: $4.35 from $4.60

• Downgraded to hold from buy at Morgans; Price Target: $4.50 from $5.45

• Downgraded to hold from accumulate at Ord Minnett; Price Target: $4.55 from $5.00

• Retained at neutral at UBS; Price Target: $4.35 from $4.50

SEEK (SEK)

• Retained at buy at Bell Potter; Price Target: $31.45 from $28.40

• Retained at buy at Citi; Price Target: $28.50

• Retained at outperform at CLSA; Price Target: $30.00 from $29.00

• Retained at neutral at Goldman Sachs; Price Target: $26.00

• Upgraded to buy from hold at Jefferies; Price Target: $32.00 from $24.60

• Retained at outperform at Macquarie; Price Target: $32.50 from $27.00

• Retained at buy at UBS; Price Target: $31.00 from $30.10

Sims (SGM)

• Retained at underweight at Morgan Stanley; Price Target: $13.00

Stockland (SGP)

• Retained at neutral at UBS; Price Target: $5.55

Superloop (SLC)

• Retained at buy at UBS; Price Target: $3.80

SRG Global (SRG)

• Retained at buy at Bell Potter; Price Target: $1.95 from $1.70

• Retained at buy at Shaw and Partners; Price Target: $2.00 from $1.80

Transurban Group (TCL)

• Retained at sector perform at RBC Capital Markets; Price Target: $13.50

Treasury Wine Estates (TWE)

• Retained at sell at Citi; Price Target: $7.00 from $8.50

Vicinity Centres (VCX)

• Retained at sell at UBS; Price Target: $2.38

Woodside Energy Group (WDS)

• Retained at neutral at Citi; Price Target: $25.50

• Retained at neutral at Macquarie; Price Target: $25.00 from $27.50

• Retained at equal-weight at Morgan Stanley; Price Target: $27.00

• Retained at neutral at UBS; Price Target: $24.85 from $25.00

Wesfarmers (WES)

• Retained at neutral at UBS; Price Target: $84.00 from $82.00

Woolworths Group (WOW)

• Retained at neutral at UBS; Price Target: $32.00 from $34.00

Scans