Evening Wrap: ASX 200 firms as resources rally rolls on, FMG, BHP, PLS and IGO winners as iron ore and lithium sectors shine

The S&P/ASX 200 closed 69.5 points higher, up 0.81%.

Strong performances from major Resources (+1.7%) stocks, particularly those in the lithium sector, were offset by falls in key Information Technology (-0.7%) shares. The "super-important in terms of index points" Financials (+0.4%) were up today, but the performance among the big banks was mixed (NAB and WBC down vs ANZ and CBA up).

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.

Also, I have detailed technical analysis on the S&P/ASX 200 in today's ChartWatch.

Let's dive in!

Markets

ASX 200 Session Chart

The S&P/ASX 200 (XJO) finished 69.5 points higher at 8,606.5, 0.81% from its session low and 0.36% from its high/low. In the broader-based S&P/ASX 300 (XKO) advancers beat decliners by a convincing 224 to 56.

Fund flows: Back to the old playbook...despite Nasdaq rally!

A super interesting trading session on the ASX today. At a high level, another strong rally – recouping important index points into the month's end. However, the structure of the rally remains inconsistent with an index that's likely capable of challenging 21 October's high unless we see greater participation from certain key sectors.

Resources (XJR) (+1.7%) was again a solid performer, as it has mostly been even in spite of this month's ASX 200 wobble. Energy (XEJ) (+0.9%) also bounced back – but it's been far less inspiring during this last dip.

At the opposite end of the spectrum, was the high P/E Ratio duo of Information Technology (XIJ) (-0.7%) and Communication Services (XTJ) (-0.5%) – we can say in spite of the powerful rally in US tech shares overnight.

So, after a very brief pause, the big funds seem to back on the high-to-low P/E rotation band wagon (but I suggest, they never really left it!).

A sector that's been hit and miss during November, has been Financials (XFJ) (+0.4%) – which I note sits at the lower end of the sector performance list today. Not terrible, just not the market leading performance that's required of it if the ASX 200 is to recoup the substantial lost ground over the last 5 weeks.

My point is, ideally both Resources and Financials are firing – and this is the surefire way for the ASX 200 to deliver a Santa Rally. It will be difficult (read as "impossible") to do it without the Big Banks. Looking at the chart above of the XFJ, I note that even after adding back recent dividends, the price action is starting to look increasingly on the wrong side of short and long term trends.

Stock Specific: Lithium rally dodges Friday's GFEX bullet

I note that iron ore stocks were good for a second day (see yesterday's detailed sector review), but lithium stocks were the big winners today as the sector continued to rebound strongly from Monday’s sharp sell-off. That sell-off was in turn caused by a late-afternoon Friday plunge in benchmark lithium futures on China’s GFEX futures market. I note that prices for the benchmark contract have since steadied – likely assisting the current rally in stocks.

Today's strongest lithium stocks

Today's best blue chip gainers

Today's worst blue chip losers

ChartWatch

S&P/ASX 200 (XJO)

Analysis

Another solid day’s trade for the ASX 200 a.k.a. the “Old Tin Pot” – even when one considers that it pretty much slid from the first hour’s peak into the close.

But, judging by the sill-relatively high close on the candle, there was sufficient latent demand in the system (i.e., the buy the dippers and probably “Santa Rally Anticipators”) to withstand that rolling supply-side barrage.

The long term uptrend appears to be offering only scant resistance to the bounce that started at 8383. For now.

Because we’re just one or two big supply-side candles away from proving it, and its pal the short term downtrend ribbon, as formidable opponents to Santa’s new rally! 🎅

I require at least the following before I can reinstate higher portfolio risk settings:

1. Rising troughs, but preferably, also rising peaks

2. Sustained demand-side candles (i.e., white-bodied and or downward pointing shadows) within the long / short term trend ribbons

3. A close above the long / short term trend ribbons, and preferably, for these ribbons to demonstrate they’re once again acting as zones of dynamic demand (i.e., downward pointing shadows into the ribbons and or troughs set in the top half or above the ribbons).

Until then, whilst happily cheering Santa on… I remain comfortable at present risk settings. "Cautiously optimistic" is the phrase I think suits best! 🤞

View

I remain comfortable at 1/3RP 🪣. (i.e., my personal allowable capital allocation limit (Risk Position) for my investments in Australian stocks is 33%). There is no change to my view because there is insufficient evidence in the technicals that the demand-side is back in control of the ASX 200’s price = I believe that the MOTN (More Often Than Not) still lies with lower and not higher prices in the near future.

Key levels

8383 is the closest point of demand. A close below this price would confirm the new long term downtrend (i.e., the bull market in ASX stocks is over! 🤯). The short and long term trend ribbons are the closest zone of supply (presently 8545-8740). In the absence of other confirming demand-side control signals, the ASX 200 must close back above this zone to demonstrate the demand-side is back in control.

ChartWatch *LIVE* Webinar Replay 📺

If you couldn't make it to today's ChartWatch *LIVE* Webinar, or you just want to revisit some of my analysis on risk management and dozens of ASX stocks, then be sure to check out the YouTube recording below. If you love ChartWatch, and you know someone who would get some value out of learning the ChartWatch model, be sure to share it on your favourite socials! 🤗

Economy

Today

• AUS October Consumer Price Index (CPI)

  • Result:

    • Headline +3.8% p.a. vs +3.6% p.a. forecast and +3.5% p.a. in September

    • Trimmed Mean +3.3% p.a. vs +3.0% p.a. forecast and +3.2% p.a. in September

  • Commentary

    • Both inflation measures are above the Reserve Bank’s 2-3% inflation target and well adrift of the 2.5% mid-point target the RBA has mentioned repeatedly in recent months.

    • "This was a difficult data release to analyse because of the change in methodology." But also, "Abstaining from these issues, today’s figures would add case to the RBA’s bias to keep interest rate unchanged. The components in the figures show that pockets of services inflation are still too high." — Diana Mousina, Deputy Chief Economist, AMP

Later this week

Thursday

• 00:30 USA October Core Durable Goods Orders

• 00:30 USA September Quarter Preliminary Gross Domestic Product

Friday

• 10:50 AUS October Private Sector Credit

Latest News

Interesting Movers

Trading higher

• +19.5% National Storage Reit (NSR) – Response to Media Speculation ("NSR confirms that it has received an unsolicited, non-binding, indicative and conditional proposal from a consortium...").

• +15.2% Argosy Minerals (AGY) – No news, general strength across the broader Lithium sector today, rise is consistent with prevailing short term uptrend and long term trend is transitioning from down to up, a regular in ChartWatch ASX Scans Uptrends list 🔎📈

• +14.5% Lake Resources (LKE) – No news, general strength across the broader Lithium sector today, rise is consistent with prevailing short term uptrend and long term trend is transitioning from down to up, a regular in ChartWatch ASX Scans Uptrends list 🔎📈

• +14.3% Mesoblast (MSB) – Continued positive response to 25-Nov Ryoncil Revenue Growth Highlighted in AGM Trading Update, bounced perfectly from long term uptrend ribbon! 🔎📈

• +12.7% Horizon Minerals (HRZ) – No news, general strength across the broader Precious Metals sector today, rise is consistent with prevailing short and long term uptrends, a recent regular in ChartWatch ASX Scans Uptrends list 🔎📈

• +9.4% Northern Minerals (NTU) – Court makes orders to allow AGM deferral.

• +9.3% Abacus Storage King (ASK) – No news (positive fall out from NSR news).

• +8.8% Gentrack Group (GTK) – Continued positive response to 24-Nov FY25 Results - Investor Presentation.

• +8.7% Sunrise Energy Metals (SRL) – No news.

• +8.5% Droneshield (DRO) – Continued positive response to 25-Nov $5.2m European military contract.

• +8.2% Pmet Resources (PMT) – No news, general strength across the broader Lithium sector today.

• +7.9% Domino's Pizza Enterprises (DMP) – Change in substantial holding (Citi increase to 6.5% from 5.1%), 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 🔎📈

• +7.8% Felix Gold (FXG) – No news since 25-Nov Shallow High-Grade Gold Results and Treasure Creek.

• +7.2% Pilbara Minerals (PLS) – 2025 AGM Presentation, general strength across the broader Lithium sector today, rise is consistent with prevailing short and long term uptrends, a regular in ChartWatch ASX Scans Uptrends list 🔎📈

• +7.1% Elevra Lithium (ELV) – No news since 25-Nov Mt Edon Rubidium Testwork Confirms High Grade Recoveries, general strength across the broader Lithium sector today, rise is consistent with prevailing short term uptrend and long term trend is transitioning from down to up, a regular in ChartWatch ASX Scans Uptrends list 🔎📈

• +7.1% Perenti (PRN) – No news, general strength across the broader Precious Metals sector today, rise is consistent with prevailing short and long term uptrends 🔎📈

• +6.5% Vault Minerals (VAU) – Vault to exit H1 FY26 materially unhedged, general strength across the broader Precious Metals sector today.

• +5.6% Unico Silver (USL) – No news, general strength across the broader Precious Metals sector today.

• +5.5% IGO (IGO) – No news, general strength across the broader Lithium sector today, rise is consistent with prevailing short term uptrend and long term trend is transitioning from down to up, a regular in ChartWatch ASX Scans Uptrends list 🔎📈

• +5.2% Global Lithium Resources (GL1) – No news, general strength across the broader Lithium sector today, rise is consistent with prevailing short and long term uptrends, a regular in ChartWatch ASX Scans Uptrends list 🔎📈

Trading lower

• -32.3% Temple & Webster Group (TPW) – 2025 AGM Presentation and Chair's and CEO's AGM Addresses and Trading Update, fall is consistent with prevailing short term downtrend and long term trend is transitioning from up to down, a recent regular in ChartWatch ASX Scans Downtrends list 🔎📉

• -32.1% Invictus Energy (IVZ) – AMOG Joint Venture & Strategic Partnership Update.

• -29.7% Viridis Mining and Minerals (VMM) – Pause in Trading.

• -9.5% West African Resources (WAF) – Reinstatement to Quotation and WAF advances discussions with Burkina Faso Government.

• -7.1% Chrysos Corp. (C79) – CSIRO Reduces Ownership, Remains a Committed Holder and Change in substantial holding.

• -4.4% Life360 (360) – No news, general weakness across the broader Information Technology sector today.

• -2.8% Technology One (TNE) – No news, general weakness across the broader Information Technology sector today, fall is consistent with prevailing short term downtrend and long term trend is transitioning from up to down, a regular in ChartWatch ASX Scans Downtrends list 🔎📉

• -2.5% Seek (SEK) – No news, general weakness across the broader Information Technology sector today, fall is consistent with prevailing short term downtrend and long term trend is transitioning from up to down, a regular in ChartWatch ASX Scans Downtrends list 🔎📉

Broker Moves

Aroa Biosurgery (ARX)

• Upgraded to buy from accumulate at Morgans; Price Target: $0.79 from $0.80

ASX (ASX)

• Retained at underweight at Morgan Stanley; Price Target: $54.05

Bendigo and Adelaide Bank (BEN)

• Downgraded to neutral from buy at Bank of America; Price Target: $10.20 from $12.80

• Retained at underweight at Morgan Stanley; Price Target: $10.00

Bellevue Gold (BGL)

• Retained at overweight at Barrenjoey; Price Target: $1.40

CAR Group (CAR)

• Upgraded to neutral from underweight at Jarden; Price Target: $34.65 from $34.00

Capricorn Metals (CMM)

• Retained at overweight at Barrenjoey; Price Target: $18.00

Deterra Royalties (DRR)

• Retained at neutral at UBS; Price Target: $3.75 from $4.25

Emerald Resources NL (EMR)

• Retained at underweight at Barrenjoey; Price Target: $4.30

Greatland Resources (GGP)

• Downgraded to neutral from overweight at Jarden; Price Target: $5.50 from $6.90

Genesis Minerals (GMD)

• Retained at underweight at Barrenjoey; Price Target: $5.30

Guzman Y Gomez (GYG)

• Upgraded to neutral from underweight at JPMorgan; Price Target: $23.40 from $23.10

Harvey Norman Holdings (HVN)

• Retained at buy at Citi; Price Target: $7.70

IVE Group (IGL)

• Retained at buy at Bell Potter; Price Target: $3.10 from $3.25

IPD Group (IPG)

• Retained at buy at Bell Potter; Price Target: $5.30

• Retained at buy at Shaw and Partners; Price Target: $5.10 from $5.00

Lynas Rare Earths (LYC)

• Retained at buy at Goldman Sachs; Price Target: $16.50 from $16.60

• Retained at outperform at Macquarie; Price Target: $17.00

• Retained at sell at Ord Minnett; Price Target: $11.00

• Retained at buy at UBS; Price Target: $17.70 from $17.80

Magnetic Resources NL (MAU)

• Retained at buy at Shaw and Partners; Price Target: $3.98

Metals X (MLX)

• Retained at buy at Ord Minnett; Price Target: $1.05

Metcash (MTS)

• Retained at buy at UBS; Price Target: $4.35

Objective Corporation (OCL)

• Upgraded to buy from hold at Moelis Australia; Price Target: $24.29

Pro Medicus (PME)

• Retained at buy at Citi; Price Target: $350.00

Ramsay Health Care (RHC)

• Retained at neutral at Citi; Price Target: $36.00 from $33.00

• Retained at neutral at Goldman Sachs; Price Target: $39.00 from $36.80

• Retained at neutral at Jarden; Price Target: $42.40 from $43.64

• Upgraded to equal-weight from underweight at Morgan Stanley; Price Target: $34.80 from $31.30

• Retained at hold at Ord Minnett; Price Target: $34.75 from $32.80

SRG Global (SRG)

• Retained at buy at Shaw and Partners; Price Target: $3.15 from $2.75

Sun Silver (SS1)

• Retained at speculative buy at Canaccord Genuity; Price Target: $2.20

Temple & Webster Group (TPW)

• Retained at buy at Citi; Price Target: $34.32

• Retained at sector perform at RBC Capital Markets; Price Target: $26.00

Vault Minerals (VAU)

• Retained at buy at Argonaut Securities; Price Target: $6.00 from $5.85

• Retained at buy at Canaccord Genuity; Price Target: $6.15 from $6.21

• Retained at buy at Euroz Hartleys; Price Target: $5.80 from $5.20

WEB Travel Group (WEB)

• Retained at buy at Citi; Price Target: $5.60 from $5.50

• Retained at overweight at Jarden; Price Target: $5.90 from $5.40

• Retained at outperform at Macquarie; Price Target: $6.85 from $6.98

• Upgraded to equal-weight from underweight at Morgan Stanley; Price Target: $4.40 from $4.00

• Upgraded to accumulate from hold at Morgans; Price Target: $5.20 from $4.88

• Retained at buy at Ord Minnett; Price Target: $7.00 from $7.53

• Retained at buy at Shaw and Partners; Price Target: $6.50 from $6.40

• Retained at buy at UBS; Price Target: $6.15 from $5.75

Scans