Market Wraps

Evening Wrap: ASX 200 higher, China's covid crisis smashes lithium stocks

Fri 25 Nov 22, 4:45pm (AEST)

The S&P/ASX 200 closed 18 points higher, up 0.24%.

The local sharemarket inches higher for a fourth consecutive session, China's covid cases top a record 30,000 as restrictions continue to intensify across major cities and resource stocks underperform led by the lithium sector.

Let's dive in.

Today in Review

Fri 25 Nov 22, 4:15pm (AEDT)

Name Value % Chg
Major Indices
ASX 200 7,259.5 +0.24%
All Ords 7,447.6 +0.21%
Small Ords 2,896.3 +0.10%
All Tech 2,114.2 +0.51%
Emerging Companies 2,187.3 -0.36%
AUD/USD 0.6775 +0.16%
US Futures
S&P 500 $4,043.0 +0.25%
Dow Jones $34,247.0 +0.11%
Nasdaq $11,914.25 +0.43%
Name Value % Chg
Utilities 8,623.9 +1.40%
Real Estate 3,137.1 +1.16%
Consumer Discretionary 2,967.2 +1.15%
Communication Services 1,444.2 +0.99%
Financials 6,630.8 +0.78%
Consumer Staples 12,906.2 +0.56%
Information Technology 1,471.1 +0.54%
Health Care 43,157.2 +0.40%
Industrials 6,551.6 +0.21%
Energy 11,493.1 -0.29%
Materials 17,354.1 -1.06%

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The ASX 200 closes the week 1.50% higher at a six month high.

  • A notable number of defensive sectors outperformed, including Telcos, Real Estate, Utilities and Staples

  • Discretionary stocks also climbed higher, perhaps in-line with Black Friday sales?

  • Growth-heavy and cycle sectors were far less inspiring

  • Materials and Energy were the only red sectors. China's daily covid cases broke through 30,000 for the first time, triggering widespread restrictions across several major cities

  • 130 of the top 200 advanced (65%)


Japan’s Tokyo inflation index accelerated to 3.8% in November from 3.5% in October. 

  • Core inflation rose to 3.6% from 3.4% in October

  • Both were 1-2 percentage points above analyst expectations 

  • Inflation in the nation’s capital has not been this high since April 1982  

Westpac's Card Tracker Index rose 1.2 points to 136.8 for the two weeks to 19 November.

  • Consumer-related card activity is almost 37% above pre-pandemic levels but beginning to flatten and 'likely stalling in real, inflation adjusted terms'

  • "A flattening in hospitality spending has also been offset by a lift in card spending on professional services. Essentials categories, particularly goods, are acting as a drag on overall spending momentum, albeit with the segment still showing positive gains." - Westpac Economics


“Commodity markets were subdued with US markets closed. Nevertheless, a weaker USD and ongoing supply side issues helped push the energy and metal markets higher,” said ANZ senior commodity analyst, Daniel Hynes. 

  • Copper +0.9% to US$3.65/lb

  • Iron ore futures +0.2% to US$92.8/t

Latest news

Post market brief

The ASX 200 managed to close higher, even under the weight of falling miners and energy stocks.

The underlying factors that typically support commodity markets (dovish Fed, weaker US dollar and Chinese stimulus) was unable to offset China's downhill battle against covid.

As cases continue to rise at an alarming rate, China has no choice but to regress to lockdowns, notably in Beijing and Guangzhou. Despite the pullback for resource-related stocks, the rest of the market has remained mostly sound to the news.

Still, how far do cases have to run and how far is China willing to go with lockdowns? The more this escalates, the more pain it will inflict on the domestic economy, with flow on effects for the rest of the world (i.e. risks to supply chains, lower commodity demand).

Index charts

S&P/ASX 200: Squeezing out more gains. You can't help but to feel the index is a little overextended at these levels. Do we begin to see some stalling and resistance around 7,300?

XJO chart
XJO chart (Source: TradingView)

S&P/ASX 200 Discretionary: Rallying into key resistance area.

XDJ chart
XDJ chart (Source: TradingView)

S&P/ASX 200 Energy: Trying to defend recent lows/old highs. More time is needed to see if it undercuts those levels or more consolidation. OPEC+ has their next meeting on 4 December. Do we see more production cuts from the petroleum cartel?

XEJ chart
XEJ chart (Source: TradingView)


Lithium: The sector got absolutely pummeled. I didn't see any bearish broker reports - could this be entirely driven by China's covid situation? Regardless, volumes were pretty heavy on big names like Allkem and Pilbara Minerals, at least 80% more than their 20-day average volumes. This isn't a garden variety 3-5% pullback. It's quite a sharp selloff that's undercut recent lows and key moving averages like 20 and 50 day. At least from a technical perspective, it reminds me of the index earlier this year whereby a) it looks oversold and a increasingly likely to bounce but b) momentum has tipped towards the downside.

Pilbara Minerals chart
Pilbara Minerals chart (Source: TradingView)
Allkem share price chart
Allkem chart (Source: TradingView)

Gold: Gold names continue to hold up pretty well. Most large cap names have run up pretty hard in the past few weeks. Let's see if they consolidate or does peak hawkishness see more V-shaped gains?

Major announcements

Large caps (>$1bn)

  • NWH Holdings (NWH) +1.6% was issued a Notice of Award by Talison Lithium for drill and blast services at the Greenbushes Mine in WA. The 7-year contract is valued at approximately $300m 

  • Centuria Capital (CNI) +1.6% reaffirmed its FY23 operating earnings per security guidance of 14.5 cents and dividend of 11.6 cents per share, up 5.4% on pcp

  • Adbri (ABC) -0.55% executed binding agreements for the sale of its land at Moorebank, NSW and Kewdale, WA for a combined $62.7m 

Mid-to-small caps

  • Maas Group (MGH) +7.6% announced a binding agreement to acquire Dandy Premix, an integrated construction materials business, for $85m 

  • Propel Funeral Partners (PFP) +4.5% AGM notes a positive start to FY23, with 1Q23 revenues up 33% to $44m and earnings up 40% to $13m

  • Autosports Group (ASG) +0.5% notes strong underlying demand for car service and parts. 1H23 net profits forecast to be $48-50m, up 22-28% on pcp 

  • Queensland Pacific Metals (QPM) -2.8% plans to launch a Carbon Abatement Hub, Australia’s first multi-user, waste gas collection and processing facility. Required license applications have been lodged and currently being assessed 

  • Deep Yellow (DYL) -4.9% completed a DFS study for its Tumas Uranium Project in Namibia. Management said the project remains “commercially attractive despite capital and cost inflation.” DFS results will be released to market in February 2023

  • City Chic Collective (CCX) -28.4% AGM expects inventory in 1H23 to be between $168-174m, down from $195.9m in July. Management flagged margin contraction as a key issue, driven by softer demand

Trading halts

  • Renascor Resources (RNU) shares are halted until Tuesday, 29 November, pending an announcement regarding a Regulatory Approval for its Siviour Graphite Project 

Broker updates 





Target price


Harvey Norman






Ord Minnett

Hold from Lighten

$4.00 from $3.60


Nick Scali



$15.83 from $14.63




Add from Hold

$5.65 from $7.40


Tyro Payments



$2.05 from $1.99


Universal Store



$5.00 from $4.90


Top Gainers

Code Company Last % Chg
HAW Hawthorn Resource... $0.14 +40.00%
PKD Parkd Ltd $0.026 +30.00%
AV1 Adveritas Ltd $0.103 +29.75%
EWC Energy World Corp... $0.05 +25.00%
ROC Rocketboots Ltd $0.115 +23.66%
View all top gainers

Top Fallers

Code Company Last % Chg
BPH BPH Energy Ltd $0.021 -32.26%
99L 99 Loyalty Ltd $0.013 -31.58%
CCX City Chic Collect... $0.965 -30.58%
NNG Nexion Group Ltd $0.056 -30.00%
QUE Queste Communicat... $0.025 -19.36%
View all top fallers

52 Week Highs

Code Company Last % Chg
GLE GLG Corp Ltd $0.475 +6.74%
MBKDA Metal Bank Ltd $0.032 +6.67%
ALO Alloggio Group Ltd $0.25 +6.38%
XTE Xtek Ltd $0.62 +5.98%
SNL Supply Network Ltd $12.25 +2.94%
View all 52 week highs

52 Week Lows

Code Company Last % Chg
NNG Nexion Group Ltd $0.054 -32.50%
CCX City Chic Collect... $0.965 -30.58%
QUE Queste Communicat... $0.025 -19.36%
OEQ Orion Equities Ltd $0.15 -18.92%
CAG Cape Range Ltd $0.12 -14.29%
View all 52 week lows

Near Highs

Code Company Last % Chg
OZBD Betashares Austra... $44.17 -0.09%
WVOL Ishares Edge MSCI... $35.51 -0.31%
NUF Nufarm Ltd $6.07 -2.57%
WBCPI Westpac Banking C... $103.66 +0.35%
MTS Metcash Ltd $4.18 +0.97%
View all near highs

Relative Strength Index (RSI) Oversold

Code Company Last % Chg
BYE Byron Energy Ltd $0.123 +2.08%
SHV Select Harvests Ltd $4.59 -0.22%
CRYP Betashares CRYPTO... $1.815 -0.28%
BUB Bubs Australia Ltd $0.345 -1.43%
RAS Ragusa Minerals Ltd $0.125 -3.85%
View all RSI oversold

Written By

Kerry Sun

Content Strategist

Kerry holds a Bachelor of Commerce from Monash University. He is an avid swing trader, focused on technical set ups and breakouts. Outside of writing and trading, Kerry is a big UFC fan, loves poker and training Muay Thai. Connect via LinkedIn or email.

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