Evening Wrap: ASX 200 sags after RBA says no rate cuts for you! Gold, base metals, lithium, and uranium stocks stronger

The S&P/ASX 200 closed 14.0 points lower, down 0.16%.

No rate cuts for YOU! 🙅

Like the Soup Nazi rejecting George Costanza for asking for bread... The Board of the Reserve Bank of Australia chose not to cut its official interest rate today, leaving it at 3.60%. Market pricing still suggests there's one more 0.25% rate cut lurking out there... but that the RBA is likely to remain on hold for the rest of this year.

Investors weren't thrilled about the news, or lack-thereof – as the pause was widely expected by economists – with stocks on the benchmark ASX 200 drifting lower for the remainder of the session after the rate decision was announced.

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 14.0 points lower at 8,848.8, 0.49% from its session high and just 0.07% from its low. In the broader-based S&P/ASX 300 (XKO) advancers lagged decliners by 121 to 150.

Resources stocks were the strongest performers today, with solid gains across the majors (BHP Group (BHP) (+1.5%)), gold (Resolute Mining (RSG) (+4.0%), Capricorn Metals (CMM) (+2.9%), Ramelius Resources (RMS) (+2.6)), base metals (South32 (S32) (+3.0%), Sandfire Resources (SFR) (+2.7%)), and lithium (Pilbara Minerals (PLS) (+%)).

Energy stocks were again in the doldrums, today officially notching over 10% of losses over the last month. Oil and gas, and coal stocks, were hit the hardest as the price of key crude oil contracts were sharply lower over night, and coal prices were modestly lower. Take a look at the chart below, what do the trends, price action, and candles tell you about how demand and supply is positioning in the XEJ now... 📉⚠️

ASX 200 Energy Sector Index (XEJ) chart (click here for full size image)

Sector leaders Woodside Energy (WDS) (-1.7%) and Santos (STO) (-2.5%) dealt the greatest blows in terms of index points, but Beach Energy (BPT) (-3.4%), Karoon Energy (KAR) (-3.2%) and New Hope Corp. (NHC) (-2.2%) also saw heavy losses.

It wasn't all doom and gloom in Energy, however, as uranium stocks generally continued their recent winning ways. Elevate Uranium (EL8) (+11.3%) and Alligator Energy (AGE) (+10.3%) were best among the smalls, while Bannerman Energy (BMN) (5.7%), Deep Yellow (DYL) (+1.0%), and Paladin Energy (PDN) (+0.6%) were the best among the larger-cap cohort.

Today's best blue chip gainers

Today's worst blue chip losers

ChartWatch

S&P/ASX 200 (XJO)

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

After a strong, and can I say promising demand-side candle yesterday, the Old Tin Pot couldn't bottle it today. It's a shame, because at today's high of 8892.4 we were certainly tickling overhead supply at 8888.

Clearly it wasn't meant to be, but the damage after the disappointment of the RBA's hold was only modest. Today's small supply-side candle doesn't detract from yesterday's strong showing – and as such (all thing being equal with US markets tonight) there's a good chance we can have another crack at 8888 tomorrow.

If we don't, or we have a crack and fail again – that would be concerning – but we'll cross that bridge of disappointment if and when we get there!

In the meantime, I acknowledge that short term trend, price action, and candle metrics remain muted, but also that yesterday's price action gives us renewed hope that the next move is to realign with the long term uptrend. Hope springs eternal! 🤞

No change to my risk settings here: 2/3RP (Full Risk Position = My personal allowable capital allocation limit for my investments in Australian stocks is 67%).

• Key levels: 8731 is the closest point of demand, the price should not close below here if the demand-side has any control of the XJO's price; a close below 8731 confirms short term supply-side control of the XJO's price and commences a new short term downtrend = ⚠️

Economy

Today

• Reserve Bank of Australia Board Meeting

  • Official Cash Rate: No change at 3.60% as forecast

  • Comment: It's not because of the worse than expected August CPI print (but it definitely didn't help!) Governor Bullock: “I’m not going to give forward guidance, I’ve said that a number of times. But what I would say is that today we felt … there had been a bit of an upside surprise on some of the inflation and activity data”.

Later this week

Wednesday

• 00:00 USA August JOLTS Job Openings (7.19 million forecast vs 7.18 million in July)

• 00:00 USA September CB Consumer Confidence (96.0 forecast vs 97.4 in August)

• 01:00 USA/GLOBAL President Trump Speaks

• ALL DAY CHN Bank Holiday

• ALL DAY GLOBAL OPEC Meetings

Thursday

• 00:00 USA September ISM Manufacturing PMI (49.0 forecast vs 48.7 in August)

• ALL DAY CHN Bank Holiday

Friday

• ALL DAY CHN Bank Holiday

• 22:30 USA September Non-farm Payrolls

  • Non-Farm Employment Change: +52,000 forecast vs +22,000 in August

  • Average Hourly Earnings: +0.3% m/m forecast vs +0.3% m/m in August

  • Unemployment Rate: +4.3% forecast vs +4.3% in August

Saturday

• 00:00 USA September ISM Services PMI (51.8 forecast vs 52.0 in August)

Latest News

Interesting Movers

Trading higher

• +82.4% Stakk (SKK) - T-Mobile USA selects Stakk as critical technology vendor.

• +23.8% Veem (VEE) - Capital Raise Presentation, 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 🔎📈

• +16.1% IDP Education (IEL) - No news, rise is consistent with prevailing short term uptrend and rising peaks and rising troughs 🔎📈

• +15.9% Starpharma (SPL) - Research and Option Agreement with Radiopharm Theranostics, rise is consistent with prevailing short and long term uptrends 🔎📈

• +13.7% Orthocell (OCC) - First Distributor signed for Remplir in $75m Canadian Market.

• +12.0% African Gold (A1G) - No news, rise is consistent with prevailing short and long term uptrends, a regular in ChartWatch ASX Scans Uptrends list 🔎📈

• +11.3% Elevate Uranium (EL8) - No news, general strength across the broader Uranium sector today, rise is consistent with prevailing short and long term uptrends, a recent regular in ChartWatch ASX Scans Uptrends list 🔎📈

• +10.3% Alligator Energy (AGE) - No news, general strength across the broader Uranium sector today.

• +10.3% New Murchison Gold (NMG) - Strong First Month of Production from Crown Prince, rise is consistent with prevailing short and long term uptrends, a regular in ChartWatch ASX Scans Uptrends list 🔎📈

• +10.0% 4DMEDICAL (4DX) - No news, rise is consistent with prevailing short and long term uptrends, a regular in ChartWatch ASX Scans Uptrends list 🔎📈

• +10.0% Island Pharmaceuticals (ILA) - No news since 29-Sep US FDA Type C meeting briefing document submitted, rise is consistent with prevailing short and long term uptrends, a regular in ChartWatch ASX Scans Uptrends list 🔎📈

Trading lower

• -25.7% 29METALS (29M) – Golden Grove Update - Xantho Extended, Downgraded to sell from hold at Ord Minnett.

• -12.0% Nova Minerals (NVA) – Notice of initial substantial holder for ADG.

• -10.8% Felix Gold (FXG) – Annual Report to shareholders.

• -9.2% Metal Powder Works (MPW) – Continued negative response to 29-Sep Annual Report.

• -8.7% Core Lithium (CXO) – No news, today’s move is consistent with recent volatility.

• -8.2% Elevra Lithium (ELV) – No news, today’s move is consistent with recent volatility.

Broker Moves

29Metals (29M)

• Downgraded to sell from hold at Ord Minnett; Price Target: $0.40 from $0.30

Alcoa Corporation (AAI)

• Retained at buy at Ord Minnett; Price Target: $63.50 from $63.00

Bellevue Gold (BGL)

• Upgraded to buy from hold at Ord Minnett; Price Target: $1.40 from $1.10

BHP Group (BHP)

• Retained at accumulate at Ord Minnett; Price Target: $45.00 from $42.50

Beach Energy (BPT)

• Retained at sell at Citi; Price Target: $1.05

Capricorn Metals (CMM)

• Upgraded to overweight from neutral at JPMorgan; Price Target: $13.00 from $10.50

• Retained at buy at Ord Minnett; Price Target: $19.00 from $11.00

Capstone Copper Corp. (CSC)

• Downgraded to hold from buy at Ord Minnett; Price Target: $13.00 from $12.00

Cedar Woods Properties (CWP)

• Retained at buy at Shaw and Partners; Price Target: $8.25

Deterra Royalties (DRR)

• Upgraded to buy from hold at Ord Minnett; Price Target: $4.50 from $4.40

Deep Yellow (DYL)

• Initiated at hold at Ord Minnett; Price Target: $1.90

Emerald Resources NL (EMR)

• Downgraded to lighten from hold at Ord Minnett; Price Target: $4.30 from $3.65

Electro Optic Systems Holdings (EOS)

• Retained at buy at Bell Potter; Price Target: $11.00 from $5.70

• Downgraded to speculative buy from buy at Canaccord Genuity; Price Target: $10.00 from $5.45

• Upgraded to speculative buy from buy at Ord Minnett; Price Target: $11.18 from $4.70

EROAD (ERD)

• Retained at buy at Shaw and Partners; Price Target: $3.20 from $2.70

Evolution Mining (EVN)

• Upgraded to hold from sell at Argonaut Securities; Price Target: $9.50 from $7.00

FireFly Metals (FFM)

• Retained at buy at Ord Minnett; Price Target: $1.65 from $1.60

Fortescue (FMG)

• Retained at accumulate at Ord Minnett; Price Target: $20.00

Greatland Resources (GGP)

• Retained at buy at Ord Minnett; Price Target: $12.00 from $10.00

IDP Education (IEL)

• Upgraded to buy from hold at Jefferies; Price Target: $8.60 from $5.00

IGO (IGO)

• Upgraded to accumulate from hold at Ord Minnett; Price Target: $5.50 from $5.25

Karoon Energy (KAR)

• Retained at buy at Citi; Price Target: $2.40

Minerals 260 (MI6)

• Retained at buy at Ord Minnett; Price Target: $0.45 from $0.30

Mineral Resources (MIN)

• Retained at accumulate at Ord Minnett; Price Target: $46.00 from $40.00

Newmont Corporation (NEM)

• Retained at buy at Ord Minnett; Price Target: $150.00 from $115.00

Nickel Industries (NIC)

• Retained at buy at Ord Minnett; Price Target: $1.70 from $1.80

NEXTDC (NXT)

• Retained at overweight at Morgan Stanley; Price Target: $20.50

Ora Banda Mining (OBM)

• Retained at accumulate at Ord Minnett; Price Target: $1.35 from $1.20

Predictive Discovery (PDI)

• Upgraded to buy from hold at Ord Minnett; Price Target: $0.50 from $0.45

Peninsula Energy (PEN)

• Retained at speculative buy at Canaccord Genuity; Price Target: $1.03 from $2.18

Pilbara Minerals (PLS)

• Retained at sell at Ord Minnett; Price Target: $1.35 from $1.25

Perseus Mining (PRU)

• Retained at hold at Ord Minnett; Price Target: $4.60 from $3.75

Rio Tinto (RIO)

• Downgraded to accumulate from buy at Ord Minnett; Price Target: $127.00 from $121.00

Regis Resources (RRL)

• Retained at sell at Ord Minnett; Price Target: $4.50 from $3.10

Resolute Mining (RSG)

• Upgraded to accumulate from hold at Ord Minnett; Price Target: $1.10 from $0.80

South32 (S32)

• Retained at buy at Ord Minnett; Price Target: $4.00 from $3.95

Sandfire Resources (SFR)

• Upgraded to buy from hold at Argonaut Securities; Price Target: $15.50 from $13.00

Seven West Media (SWM)

• Retained at neutral at E&P; Price Target: $0.17

West African Resources (WAF)

• Retained at buy at Ord Minnett; Price Target: $3.40

Woodside Energy Group (WDS)

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

Scans