News
Lithium stocks are soaring - but you may not want to get your hopes up
Thu 12 Sep 24, 4:35pm (AEST)
Market Wraps
Evening Wrap: ASX 200 gains on surging uranium and lithium stocks
Thu 12 Sep 24, 5:34pm (AEDT)
Stocks in article
The S&P/ASX 200 closed 87.8 points higher, up 1.1%.
A stonking day's performance for Aussie stocks – all eleven major sectors closing with gains, and most of those with gains in excess of 1%.
Certainly, positive leads from US equities helped, but throw in left-field news shots of adrenaline for lithium and uranium stocks within the space of 24-hours, and you can be sure that there are going to be some ASX stocks in those sectors sporting major rocket ship emojis 🚀!
I have detailed technical analysis on US and local indices moves in today's ChartWatch, and you'll also find the usual reporting of the major stock-specific moves, the broker responses to them, as well as all of the key upcoming economic data in tonight's Evening Wrap...so....
Let's dive in!
Today in Review
Thu 12 Sep 24, 5:05pm (AEST)
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Markets
ASX 200 Session Chart
The S&P/ASX 200 (XJO) finished 87.8 points higher at 8,075.7, 1.2% from its session high and just 0.04% from its high. In the broader-based S&P/ASX 300 (XKO), advancers beat decliners by an emphatic 236 to 44. This is important because broad-based moves which close at the high of the session are more likely to be sustainable.
Not surprisingly given the massive turnaround in the NASDAQ last night in the US (closed up +2.1%, but +3.7% from its session low), the Information Technology (XIJ) (+2.4%) sector was the best performing sector today.
Basically, Wednesday’s CPI data, even though fractionally hotter than expected at the core, will not be enough to prevent the US Federal reserve embarking on a new rate cutting cycle. Markets hate uncertainty, we just jettisoned one big one. Rate cuts are coming.
Tech is one of (if not the biggest) beneficiaries of lower market rates/yields, but other interest rate sensitives like Real Estate Investment Trusts (XPJ) (+1.8%), Gold (XGD) (+1.5%), Financials (XFJ) (+1.3%) and Consumer Discretionary (XDJ) (+1.2%) were all top performers today.
Company | Last Price | Change $ | Change % | 1mo % | 1yr % |
Tabcorp (TAH) | $0.445 | +$0.04 | +9.9% | -25.2% | -57.0% |
Resolute Mining (RSG) | $0.695 | +$0.055 | +8.6% | +8.6% | +110.6% |
Zip Co. (ZIP) | $2.26 | +$0.15 | +7.1% | +20.5% | +653.3% |
Nuix (NXL) | $5.44 | +$0.33 | +6.5% | +66.9% | +221.9% |
Red 5 (RED) | $0.305 | +$0.015 | +5.2% | -14.1% | +35.6% |
MA Financial Group (MAF) | $5.37 | +$0.24 | +4.7% | +20.7% | +11.2% |
Block (SQ2) | $95.46 | +$4.13 | +4.5% | +0.1% | +13.7% |
Insignia Financial (IFL) | $2.37 | +$0.1 | +4.4% | -14.4% | -5.6% |
Domino's Pizza Enterprises (DMP) | $31.16 | +$1.24 | +4.1% | -5.9% | -41.1% |
Generation Development Group (GDG) | $2.84 | +$0.11 | +4.0% | +7.6% | +125.3% |
Light & Wonder (LNW) | $165.60 | +$6.1 | +3.8% | +5.6% | +39.2% |
Audinate Group (AD8) | $9.72 | +$0.34 | +3.6% | +8.0% | -25.2% |
Megaport (MP1) | $7.78 | +$0.27 | +3.6% | -28.9% | -27.6% |
Wisetech Global (WTC) | $131.64 | +$4.46 | +3.5% | +40.7% | +92.3% |
Pexa Group (PXA) | $13.73 | +$0.43 | +3.2% | +2.2% | +17.2% |
Pinnacle Investment Management Group (PNI) | $16.97 | +$0.52 | +3.2% | -1.6% | +85.5% |
De Grey Mining (DEG) | $1.145 | +$0.035 | +3.2% | -6.1% | -13.6% |
AMP (AMP) | $1.320 | +$0.04 | +3.1% | +0.8% | +2.7% |
Judo Capital (JDO) | $1.685 | +$0.05 | +3.1% | +24.8% | +69.3% |
NIB (NHF) | $5.88 | +$0.17 | +3.0% | -18.6% | -24.5% |
The strongest stocks from the XIJ, XPJ, XGD, XFJ, and XDJ today
Elsewhere, the Energy (XEJ) (+2.3%) sector prospered on the second day of rising crude oil prices, helping sector heavyweights Woodside Energy (ASX: WDS) (2.0%) and Santos (ASX: STO) (1.2%) to modest gains, but those two were easily overshadowed by a lithium-like resurgence in ASX-listed uranium stocks.
Much like those lithium stocks yesterday, news has triggered buying and short covering in the similarly beaten down uranium sector. News reports indicated that Russian President Vladimir Putin has asked his government to consider exports limits on uranium (as well as other commodities like nickel and titanium) in retaliation for western sanctions.
Front month uranium futures on COMEX rose US$0.80/lb or 0.76% to close back above the US$80/lb mark for the first time in nearly three weeks, US uranium stocks also rose strongly overnight.
Company | Last Price | Change $ | Change % | 1mo % | 1yr % |
Deep Yellow (DYL) | $1.175 | +$0.14 | +13.5% | +18.1% | +23.0% |
Bannerman Energy (BMN) | $2.39 | +$0.28 | +13.3% | -0.8% | +3.0% |
Boss Energy (BOE) | $2.89 | +$0.28 | +10.7% | +0.3% | -27.4% |
Paladin Energy (PDN) | $9.79 | +$0.82 | +9.1% | -2.7% | +8.8% |
Peninsula Energy (PEN) | $0.084 | +$0.006 | +7.7% | -3.4% | -3.1% |
Nexgen Energy (NXG) | $8.72 | +$0.57 | +7.0% | -1.7% | +0.8% |
Beach Energy (BPT) | $1.150 | +$0.055 | +5.0% | -11.9% | -30.1% |
Whitehaven Coal (WHC) | $5.76 | +$0.25 | +4.5% | -25.3% | -5.7% |
Yancoal Australia (YAL) | $5.42 | +$0.17 | +3.2% | -24.3% | +11.1% |
Karoon Energy (KAR) | $1.480 | +$0.04 | +2.8% | -16.4% | -40.9% |
Strike Energy (STX) | $0.185 | +$0.005 | +2.8% | +8.8% | -51.3% |
Coronado Global Resources (CRN) | $0.930 | +$0.025 | +2.8% | -30.6% | -42.4% |
Viva Energy Group (VEA) | $2.83 | +$0.06 | +2.2% | -9.6% | -10.4% |
Woodside Energy Group (WDS) | $23.92 | +$0.46 | +2.0% | -6.2% | -37.5% |
New Hope Corporation (NHC) | $4.28 | +$0.07 | +1.7% | -15.6% | -27.3% |
Santos (STO) | $6.93 | +$0.08 | +1.2% | -10.5% | -11.4% |
ASX uranium stocks had a big day out today…
On those lithium stocks, they generally had another solid day, even as GFEX Lithium Carbonate futures in China pulled back modestly.
Company | Last Price | Change $ | Change % | 1mo % | 1yr % |
Vulcan Energy Resources (VUL) | $4.06 | +$0.32 | +8.6% | +6.6% | +33.1% |
Latin Resources (LRS) | $0.195 | +$0.015 | +8.3% | +62.5% | -39.1% |
Mineral Resources (MIN) | $38.02 | +$2.9 | +8.3% | -17.9% | -44.6% |
Pilbara Minerals (PLS) | $2.88 | +$0.21 | +7.9% | +1.1% | -34.7% |
IGO (IGO) | $5.48 | +$0.35 | +6.8% | +8.9% | -60.5% |
Sayona Mining (SYA) | $0.028 | +$0.001 | +3.7% | +12.0% | -72.0% |
Liontown Resources (LTR) | $0.715 | +$0.025 | +3.6% | -10.6% | -74.3% |
Arcadium Lithium (LTM) | $3.83 | +$0.13 | +3.5% | -3.8% | 0% |
Develop Global (DVP) | $2.13 | +$0.05 | +2.4% | +4.9% | -22.8% |
Wildcat Resources (WC8) | $0.225 | +$0.005 | +2.3% | -13.5% | -49.4% |
ASX lithium stocks today
ChartWatch
NASDAQ Composite Index
Zero. Hero.
Just a quick one here because we only just covered the Comp in Monday's ChartWatch.
In that update, we were contemplating the meaning of a dirty great big black candle closing just within the bounds of the dynamic demand zone we'd ordinarily associate with the long term uptrend ribbon.
Last night's reversal has created one of the most emphatic demand-side candles you are likely to see – it is an absolute cracker: Long downward pointing shadow, relatively long white body, close very near the high of the session. It could have been made even better by a greater showing of volume – but I note its volume is still above average compared to the last 3 months (that’s the trailing red line in the volume window).
So, there’s that…
Then you add in where it occurred, i.e. after a test (and therefore confirming a hold) of the long term uptrend ribbon…
And then you can add in that it stamps out a higher swing low than 15708…
Putting it all together, I suggest you’ve got yourself a big line in the sand between bull and bear market. I reckon it’s that significant.
I’ll make it this simple for you: As long as the Comp does not close below 16668 the bull market is very much alive and well. Alternatively should the Comp close below 16668 – something very, very wrong is afoot in US equities.
S&P/ASX 200 (XJO)
I don't want to jinx it, but...
Which brings us to the impact here, on the XJO.
I know that I whinge about how dreary and benign the XJO can be when compared to bull markets in other world stock indices at times, but mea culpa, whilst we haven’t really done much over the last couple of weeks – at least we didn’t track that last dive US stocks.
This sets us up beautifully to take advantage of any rally that’s in store as a result of last night’s strong performance.
“A very nice base” is the way I would describe the XJO’s current technicals, with us holding the short and long term uptrend ribbons, logging generally demand-side candles, and at a whisker away from resuming rising peaks and rising troughs.
Double static points of demand at 7918-28 also support, and today’s strong candle has us closing above the balance point of the 4 September supply candle, and within striking distance of the now-critical 8117-8149 supply zone.
I don’t want to jinx anything by saying that it should be a mere formality from here, but…oops (frantically hitting delete button)! 😁
Economy
Today
There weren't any major data releases in our time zone today
Later this week
Thursday
22:15 EUR ECB Main Refinancing Rate & Monetary Policy Statement (-0.50% forecast to 4.25%)
22:30 USA Core PPI August (+0.2% m/m to +2.4% p.a. forecast vs +0.2% to +2.4% p.a. in July)
Saturday
00:00 USA Prelim UoM Consumer Sentiment August (68.4 forecast vs 67.9 July)
Latest News
Interesting Movers
Trading higher
+16.7% Appen (APX) - Becoming a substantial holder, rise is consistent with prevailing short term uptrend, long term trend is transitioning from down to up 🔎📈
+13.5% Deep Yellow (DYL) - No stock-specific news, but see Markets section above for explanation of why the whole sector got a run today (threat of Russian export limits)
+13.3% Bannerman Energy (BMN) - Ditto uranium
+12.9% Jupiter Mines (JMS) - No news, likely hitching a ride on last couple of days positive sentiment in lithium / battery materials
+12.5% Syrah Resources (SYR) - No news, likely hitching a ride on last couple of days positive sentiment in lithium / battery materials
+12.0% Silex Systems (SLX) - Ditto uranium
+11.5% PYC Therapeutics (PYC) - No news, rise is consistent with prevailing short and long term uptrends 🔎📈
+10.7% Boss Energy (BOE) - Ditto ASX uranium
+9.9% Tabcorp (TAH) - Change of interest - Brett Chenoweth (on market purchase)
+9.1% Paladin Energy (PDN) - Ditto ASX uranium
+9.1% Nickel Industries (NIC) - No news, Russian news of commodity export limits stocking interest in nickel
+8.6% Resolute Mining (RSG) - Group Exploration Update - Senegal and Guinea, rise is consistent with prevailing short and long term uptrends 🔎📈
+8.6% Vulcan Energy Resources (VUL) - Lithium sector gains pushing into second day…
+8.5% Spartan Resources (SPR) - No news, rise is consistent with prevailing short and long term uptrends 🔎📈
+8.3% Latin Resources (LRS) - Ditto lithium
+8.3% Mineral Resources (MIN) - Ditto lithium, also see Broker Notes section below - several updates there…
+8.1% Iperionx (IPX) - No news, Russian news of commodity export limits stocking interest in titanium
+8.1% Calix (CXL) - Calix Newsletter September 2024, but is another battery materials winner…
+7.9% Pilbara Minerals (PLS) - Ditto lithium
+7.7% Peninsula Energy (PEN) - Ditto uranium
+7.1% Mount Gibson Iron (MGX) - No news, iron ore price rally
+7.1% Zip Co. (ZIP) - No news, strong Financials sector, rise is consistent with prevailing short and long term uptrends 🔎📈
+7.0% Nexgen Energy (NXG) - Ditto uranium
+6.8% IGO (IGO) - Ditto lithium (and nickel)
+6.6% Pointsbet (PBH) - No news, rise is consistent with prevailing short and long term uptrends 🔎📈
+6.5% Nuix (NXL) - No news, rise is consistent with prevailing short and long term uptrends 🔎📈
+6.0% Lotus Resources (LOT) - Ditto uranium
Trading lower
-5.4% McMillan Shakespeare (MMS) - Ex-dividend $0.78 fully franked
-3.8% Imugene (IMU) - Appendix 2A, fall is consistent with prevailing short and long term downtrends 🔎📈
-3.1% GDI Property Group (GDI) - No news
-2.9% Ioneer (INR) - No news
-2.8% Spark New Zealand (SPK) - Ex-dividend $0.1278 unfranked
-2.8% Nine Entertainment (NEC) - Ex-dividend $0.045 fully franked, plus Nine CEO Mike Sneesby to step down
Broker Notes
The A2 Milk Company (A2M)
Initiated at equal-weight at Morgan Stanley; Price Target: NZ$6.40
Adrad (AHL)
Retained at buy at Bell Potter; Price Target: $1.12
Boss Energy (BOE)
Upgraded to buy from hold at Argonaut Securities; Price Target: $3.65 from $4.05
Initiated at buy at UBS; Price Target: $3.50
Charter Hall Retail Reit (CQR)
Retained at equal-weight at Morgan Stanley; Price Target: $3.88
Imugene (IMU)
Retained at buy at Bell Potter; Price Target: $0.10 from $0.15
Johns Lyng Group (JLG)
Retained at overweight at Morgan Stanley; Price Target: $4.40 from $7.20
Karoon Energy (KAR)
Retained at outperform at Macquarie; Price Target: $2.15
Maas Group (MGH)
Retained at add at Bell Potter; Price Target: $5.20
Mineral Resources (MIN)
Retained at buy at Citi; Price Target: $50.00
Retained at overweight at JP Morgan; Price Target: $50.00
Retained at overweight at Morgan Stanley; Price Target: $70.00
Retained at accumulate at Ord Minnett; Price Target: $56.50
Newmont Corporation (NEM)
Retained at outperform at Macquarie; Price Target: $83.00 from $85.00
National Storage Reit (NSR)
Retained at buy at Citi; Price Target: $2.70
Nexted Group (NXD)
Retained at buy at Ord Minnett; Price Target: $0.30 from $0.50
Nextdc (NXT)
Retained at buy at Canaccord Genuity; Price Target: $18.85
Retained at outperform at CLSA; Price Target: $21.60
Retained at positive at E&P; Price Target: $25.70
Retained at overweight at JP Morgan; Price Target: $18.50
Retained at outperform at RBC Capital Markets; Price Target: $20.00
Paladin Energy (PDN)
Upgraded to buy from hold at Argonaut Securities; Price Target: $10.55 from $10.40
Retained at overweight at Morgan Stanley; Price Target: $12.00 from $16.65
Initiated at buy at UBS; Price Target: $10.90
Proteomics International Laboratories (PIQ)
Downgraded to reduce from buy at Morgans; Price Target: $0.50 from $0.99
Qualitas (QAL)
Retained at add at Morgans; Price Target: $3.20
Regal Partners (RPL)
Retained at buy at Bell Potter; Price Target: $4.30
Siteminder (SDR)
Retained at overweight at Morgan Stanley; Price Target: $6.80
Scans
Carl has over 30-years investing experience, helping investors navigate several bull and bear markets over this time. He is a well respected markets commentator who specialises in how the global macro impacts Australian and US equities. Carl has a passion for technical analysis and has taught his unique brand of price-action trend following to thousands of Aussie investors.
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