Market Wraps

Evening Wrap: ASX 200 slides as gold, mining stocks hobbled, takeover talk saves Bapcor and Strike Energy

Tue 11 Jun 24, 5:32pm (AEST)

Stocks in article

adh
MktCap:
-
bap
MktCap:
-
cat
MktCap:
-
chn
MktCap:
-
emr
MktCap:
-
min
MktCap:
-
ntu
MktCap:
-
pen
MktCap:
-
stx
MktCap:
-
skc
MktCap:
-
waf
MktCap:
-
zip
MktCap:
-

Share article

The S&P/ASX 200 closed 104.6 points lower, down 1.33%.

It was a lousy day by even the usual lousy Aussie stock market standards.

We were due a little bit of catch up after a long weekend: US stocks were up slightly on a net basis over the last two trading sessions – unlikely to have had much on an impact today.

But two straight days of falls in commodity prices, borderline severe for some, likely had a greater impact.

Once again, the Aussie market can’t do anything until we get the greenlight from our American counterparts. That light – green, red, or otherwise won’t come until after Thursday morning’s Federal Reserve meeting.

Plus there’s a bunch of other big data out in what is going to be a massive week in determining where stock prices are going to be in the not-too-distant future…for all of this and more…

Let's dive in!


Today in Review

Tue 11 Jun 24, 5:10pm (AEST)

Name Value % Chg
Major Indices
ASX 200 7,755.4 -1.33%
All Ords 8,005.9 -1.32%
Small Ords 2,963.4 -1.86%
All Tech 3,087.6 -0.48%
Emerging Companies 2,130.5 -1.25%
Currency
AUD/USD 0.6607 -0.04%
US Futures
S&P 500 5,369.75 -0.03%
Dow Jones 38,906.0 -0.06%
Nasdaq 19,095.0 -0.08%
Name Value % Chg
Sector
Consumer Discretionary 3,512.7 +0.11%
Information Technology 2,288.4 -0.15%
Consumer Staples 12,167.5 -0.57%
Financials 7,508.4 -0.85%
Health Care 43,134.4 -1.04%
Communication Services 1,483.8 -1.21%
Energy 9,890.9 -1.22%
Industrials 6,911.6 -1.32%
Utilities 9,012.5 -2.03%
Real Estate 3,629.0 -2.35%
Materials 17,511.1 -2.58%

Enjoying the Evening Wrap? Sign up to get it sent directly to your inbox after every trading day.


Markets

XJO Intraday Chart 11 June 2024
ASX 200 Session Chart

The S&P/ASX 200 (XJO) finished 104.6 points lower at 7,755.4, 1.3% from its session high and just 0.26% from its high/low.

In the broader-based S&P/ASX 300 (XKO), advancers lagged decliners by a particularly dismal 42 to 236.

In keeping with the pretty much all up or all down nature of the Aussie market over the last couple of months, 10 of the 11 major ASX sectors were down today.

The only sector that scraped in with a win was Consumer Discretionary (XDJ) (+0.11%), and this was largely to do with a takeover offer being lobbed for Bapcor (ASX: BAP) (+14%) – so it hardly counts!

The “doing it tough today” sectors mainly fell into two categories. Worst hit were Materials (XMJ) (-2.6%) as they caught up to two straight days of falls across various exchanges – some quite severe as can be seen in the table below. Note, all changes are 2-day changes (so Friday and Monday’s moves).

Company

Last Price

Change $

Change %

1mo %

1yr %

Copper - LME Official Cash

$9694.50

-$235.50

-2.4%

-0.3%

+16.1%

Aluminium - LME Official Cash

$2515.50

-$71.50

-2.8%

+0.9%

+16.0%

Iron Ore CFR China 62% Fe Spot

$107.38

-$1.12

-1.0%

-8.2%

0%

Nickel - LME Official Cash

$17835

-$295

-1.6%

-4.2%

-15.1%

Lead - LME Official Cash

$2128

-$60

-2.7%

-2.2%

+3.5%

Tin - LME Official Cash

$31700

-$200

-0.6%

-2.2%

+21.7%

Zinc - LME Official Cash

$2759

-$83.50

-2.9%

-3.5%

+15.8%

Silver/U.S. Dollar Spot Rate

$29.72

-$1.57

-5.0%

+5.6%

+24.1%

Gold/U.S. Dollar Spot Rate

$2310.58

-$64.97

-2.7%

-2.1%

+18.5%

Uranium Futures COMEX

$83.30

-$3.90

-4.5%

-8.8%

+40.1%

Combined 2 days of moves on in various commodity prices

Within materials/resources, the Gold (XGD) sub-index was hobbled. There's no other word for at 5.5% sector decline today – but there were several individual performances that were far worse.

Company

Last Price

Change $

Change %

1mo %

1yr %

Chalice Mining (CHN)

$1.480

-$0.16

-9.8%

+3.5%

-79.7%

Emerald Resources (EMR)

$3.45

-$0.37

-9.7%

-1.4%

+66.7%

West African Resources (WAF)

$1.395

-$0.14

-9.1%

-2.8%

+62.2%

Kingsgate Consolidated (KCN)

$1.655

-$0.165

-9.1%

-7.3%

+28.8%

Genesis Minerals (GMD)

$1.815

-$0.175

-8.8%

0%

+39.6%

Regis Resources (RRL)

$1.765

-$0.155

-8.1%

-16.4%

-15.6%

Resolute Mining (RSG)

$0.540

-$0.045

-7.7%

+17.4%

+13.7%

Firefly Metals (FFM)

$0.675

-$0.055

-7.5%

-24.6%

+25.0%

Capricorn Metals (CMM)

$4.44

-$0.35

-7.3%

-4.9%

-1.1%

Ramelius Resources (RMS)

$1.855

-$0.145

-7.3%

-7.3%

+25.3%

Metals X (MLX)

$0.400

-$0.03

-7.0%

-8.0%

+50.9%

Evolution Mining (EVN)

$3.76

-$0.26

-6.5%

-2.1%

+7.4%

Liontown Resources (LTR)

$1.085

-$0.075

-6.5%

-22.5%

-60.3%

Gold Road Resources (GOR)

$1.590

-$0.105

-6.2%

-1.2%

-13.6%

De Grey Mining (DEG)

$1.060

-$0.07

-6.2%

-13.8%

-23.4%

A tough day for resources stocks today.

The next category of doing it tough today included the interest rate sensitives. See ChartWatch for analysis of one of the key contributing factors to today’s declines – a most unwanted pop up in key market yields.

This left sectors like Real Estate (XRE) (-2.4%) deeply mired in the red.

Company

Last Price

Change $

Change %

1mo %

1yr %

Mirvac Group (MGR)

$1.890

-$0.105

-5.3%

-9.6%

-18.9%

Lendlease Group (LLC)

$5.56

-$0.22

-3.8%

-11.5%

-24.9%

Waypoint Reit (WPR)

$2.33

-$0.09

-3.7%

-3.3%

-14.0%

Arena Reit. (ARF)

$3.65

-$0.14

-3.7%

-2.7%

-4.7%

Dexus (DXS)

$6.71

-$0.25

-3.6%

-5.9%

-19.5%

Charter Hall Long Wale Reit (CLW)

$3.42

-$0.12

-3.4%

-2.8%

-20.3%

Centuria Office Reit (COF)

$1.170

-$0.04

-3.3%

-1.3%

-18.2%

Charter Hall Social Infrastructure Reit (CQE)

$2.43

-$0.08

-3.2%

-4.0%

-18.5%

Centuria Industrial Reit (CIP)

$3.11

-$0.1

-3.1%

-3.4%

-1.0%

Charter Hall Retail Reit (CQR)

$3.25

-$0.1

-3.0%

-2.7%

-13.1%

Real Estate stocks also did it tough today

ChartWatch

US 10-Year T-Note Yield

US 10-Year T-Note Yield chart 10 June 2024
Mechanic says to car owner: Yep, there's your problem...

It’s all about yields. It usually is.

The US 10-year T-Note yield is what we call a benchmark yield. It’s one of the key global yields from which market rates (e.g., your mortgage rate and your term deposit rates) are set.

US treasuries are considered risk free given that Uncle Sam has always paid his bills.

So, if you can get more in a risk-free investment (about 0.20% more over the last two trading sessions to 4.47% p.a.), then the price of every other asset that isn’t risk free usually must fall.

Aussie stocks certainly aren’t risk free - and they’re yielding far less than US 10-year T-Notes (the 1 year forward dividend yield of the S&P/ASX 200 is about 3.8% according to Macquarie – let alone looking 10 years out!).

All the above means that investing in US 10-year T-Notes might look like a pretty good bet to some, and today, I suggest this dragged on the local bourse.

Where to from here?

I hope down. The peak at 4.64 is lower than 4.74 which itself is lower than the ‘big one’ at 5.02.

That pesky long term uptrend ribbon keeps kicking the T-Note yield back up, though, and until we close below it it’s hard to call the general uptrend in yields decisively broken.

S&P/ASX 200 (XJO)

S&PASX 200 Index chart 11 June 2024
Looked so good on Friday...now...not so much...

Where does all the above leave the local benchmark? Mercifully, not all that far away from its record high.

We even saw a sliver of excess demand around the dynamic demand zone of the short term uptrend ribbon towards the close.

Ideally that ribbon holds, and we see a couple of quick demand side candles (white-bodies and or downward pointing shadows) to kick us back towards supply at 7900-7911.

A close above there and today's shenanigans will be a nothing but a distant memory.

I hear you chuckle – there's no bloody way in hell we're going to do that, Carl!

Hey! Don't underestimate the power of the bull market! Anything is possible, and the long term trend remains up.

But, if we do go the other way, and keep logging this black candles, a close below the short term uptrend ribbon would likely set us up for yet another test of the dynamic demand of the long term uptrend ribbon.

(I will go there) It's not until a close below 7492 that I would declare the current bull market in Aussie stocks over.


Economy

Today

  • AUS NAB Business Confidence May

    • -3 points vs 2 points in April (revised up from 1 point)

    • Business conditions -1 points (dipped below long term average), trading conditions and profitability down, employment sub-component +3 points (back to above long term average)

    • Capacity utilisation (83.3%) remains above average

    • Labour cost growth rose to 2.3% q/q (from 1.5% q/q in April); purchase cost growth rose to 1.9% q/q (from 1.3% q/q); retail price growth rose to +1.6% q/q (from 1.0%) = Inflationary pressures are building – not easing!

    • NAB Chief Economist Alan Oster: “Overall, the message here is a mixed one for the RBA...There are warning signs on the outlook for growth but at the same time reasons to be very wary about the inflation outlook, and we expect the RBA to keep rates on hold for some time yet as they navigate through these contrasting risks.

NAB Monthly Business Survey May-24, Source NAB Economics
Chart 1: Confidence & Conditions (Net Balance, SA) All data seasonally adjusted and subject to revision. Survey conducted from 20 to 28 May 2024, covering around 500 firms across the non-farm business sector. Next release date: 9 July 2024. From: NAB Monthly Business Survey May-24, NAB Economics, 11 June 2024.

Later this week:

Wednesday

  • 11:30 CHINA Consumer Price Index (CPI) May (forecast +0.4% p.a. vs +0.3% p.a. April)

  • 11:30 CHINA Producer Price Index (PPI) May (forecast -1.5% p.a. vs -2.5% p.a. April)

  • 22:30 USA Core Consumer Price Index (CPI) May (forecast +0.3% m/m and 3.6% p.a. vs +0.3% m/m and +3.7% p.a. April)

Thursday

  • 04:00 USA Federal Reserve FOMC meeting, Fed Funds Rate, economic projections, statement, & press conference (forecast no change 5.25%-5.50%)

  • 11:30 AUS Employment Change & Unemployment Rate May (forecast +30.5k vs +38.5k April | U-Rate forecast 4.0% vs 4.1% April)

  • 22:30 USA Core Producer Price Index (CPI) May (forecast +0.3% m/m and 3.6% p.a. vs +0.3% m/m and +3.7% p.a. April)

Friday

  • TBA JPN Bank of Japan Policy Rate & Monetary Policy Statement (forecast no change <0.1%)

Saturday

  • 00:00 USA Prelim UoM Consumer Sentiment May (forecast 72.5 vs 69.1 April)


Latest News


Interesting Movers

Trading higher

  • +14.0% Bapcor (BAP) - Response to media speculation

  • +13.2% Strike Energy (STX) - Article in The Australian (paywall) Gina Rinehart's Hancock Prospecting is considering a possible buyout

  • +7.5% Zip Co. (ZIP) - No news, rise is consistent with prevailing long term uptrend, closed back above short term downtrend ribbon πŸ”ŽπŸ“ˆ

  • +4.6% Adairs (ADH) - No news πŸ€”

  • +4.0% Platinum Asset Management (PTM) - No news πŸ€”

  • +4.0% Catapult Group International (CAT) - No news, continued positive response to 30 May FY24 Appendix 4E and Full Year Statutory Accounts, rise is consistent with prevailing short and long term uptrends πŸ”ŽπŸ“ˆ

  • +3.3% Mesoblast (MSB) - No news, rise is consistent with prevailing long term uptrend πŸ”ŽπŸ“ˆ

  • +3.2% Nuix (NXL) - No news, rise is consistent with prevailing short and long term uptrends πŸ”ŽπŸ“ˆ

  • +2.9% Skycity Entertainment Group (SKC) - Disclosure Of Former Senior Managers Relevant Interests

  • +2.8% Regal Partners (RPL) - No news, retained at buy at Bell Potter and price target increased to $4.75 from $4.02, rise is consistent with prevailing short and long term uptrends πŸ”ŽπŸ“ˆ

Trading lower

  • -9.8% Chalice Mining (CHN) - Gonneville Project Metallurgical Testwork and PFS Update, generally tough day for battery metals stocks, fall is consistent with prevailing long term downtrend, closed back below short term downtrend ribbon πŸ”ŽπŸ“‰

  • -9.7% Emerald Resources (EMR) - No news, generally tough day for ASX gold sector…closed below short term uptrend ribbon πŸ”ŽπŸ“‰

  • -9.1% West African Resources (WAF) - No news, generally tough day for ASX gold sector…closed below short term uptrend ribbon πŸ”ŽπŸ“‰

  • -9.1% Peninsula Energy (PEN) - Completion of Retail Entitlement Offer & A$106M Equity Raise, generally tough day for ASX uranium stocks on sharp fall in uranium price, fall is consistent with prevailing short and long term downtrends πŸ”ŽπŸ“‰

  • -9.1% Kingsgate Consolidated (KCN) - No news, generally tough day for ASX gold sector…closed below short term uptrend ribbon πŸ”ŽπŸ“‰

  • -8.8% Genesis Minerals (GMD) - No news, generally tough day for ASX gold sector…closed below short term uptrend ribbon πŸ”ŽπŸ“‰

  • -8.1% Silver Mines (SVL) - No news, generally tough day for ASX gold sector…closed below short term uptrend ribbon πŸ”ŽπŸ“‰

  • -8.1% Regis Resources (RRL) - No news, generally tough day for ASX gold sector…closed below short term uptrend ribbon πŸ”ŽπŸ“‰

  • -8.1% Winsome Resources (WR1) - No news, generally tough day for ASX lithium stocks on continued fall in lithium minerals prices, fall is consistent with prevailing short and long term downtrends πŸ”ŽπŸ“‰

  • -7.7% Resolute Mining (RSG) - No news, generally tough day for ASX gold sector…closed below short term uptrend ribbon πŸ”ŽπŸ“‰

  • -7.5% Firefly Metals (FFM) - I could keep going…but I think you get the picture…copper here…

  • -7.3% Capricorn Metals (CMM) - gold again…

  • -7.3% Ramelius Resources (RMS) - gold again…

  • -7.0% Metals X (MLX) - tin…

  • -6.5% Evolution Mining (EVN) - gold again…

  • -6.5% Liontown Resources (LTR) - lithium again…

  • -6.2% Gold Road Resources (GOR) - gold again…

  • -6.2% De Grey Mining (DEG) - gold again…


Broker Notes

  • Life360 Inc. (360)

    • Retained at buy at Bell Potter; Price Target: $17.00 from $17.75

  • Aussie Broadband (ABB)

    • Upgraded to buy from accumulate at Ord Minnett; Price Target: $4.20 from $4.19

  • Aristocrat Leisure (ALL)

    • Retained at buy at Citi; Price Target: $53.00

  • Eagers Automotive (APE)

    • Retained at sell at Citi; Price Target: $9.55

  • APM Human Services International (APM)

    • Downgraded to hold from buy at Bell Potter; Price Target: $1.45 from $1.40

  • Australian Vanadium (AVL)

    • Retained at buy at Shaw and Partners; Price Target: $0.08

  • BHP Group (BHP)

    • Retained at hold at Ord Minnett; Price Target: $40.50

  • Boss Energy (BOE)

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

  • Brazilian Rare Earths (BRE)

    • Retained at buy at Ord Minnett; Price Target: $6.10

  • Brambles (BXB)

    • Upgraded to overweight from equal-weight at Morgan Stanley; Price Target: $16.60 from $15.70

  • Commonwealth Bank of Australia (CBA)

    • Retained at sell at Citi; Price Target: $85.00

  • Credit Clear (CCR)

    • Initiated at buy at Shaw and Partners; Price Target: $0.40

  • Codan (CDA)

    • Downgraded to neutral from outperform at Macquarie; Price Target: $11.15 from $11.14

  • Capricorn Metals (CMM)

    • Retained at buy at Bell Potter; Price Target: $6.50

  • Cooper Energy (COE)

    • Retained at hold at Bell Potter; Price Target: $0.21

  • Gentrack Group (GTK)

    • Retained at buy at Shaw and Partners; Price Target: $10.00 from $9.10

  • Hastings Technology Metals (HAS)

    • Retained at hold at Ord Minnett; Price Target: $0.27

  • Imdex (IMD)

    • Downgraded to neutral from outperform at Macquarie; Price Target: $2.42 from $2.30

  • James Hardie Industries (JHX)

    • Retained at hold at Ord Minnett; Price Target: $51.00

  • Lynas Rare Earths (LYC)

    • Retained at buy at Ord Minnett; Price Target: $8.00

  • Mineral Resources (MIN)

    • Retained at buy at Bell Potter; Price Target: $84.00 from $85.00

    • Retained at buy at Citi; Price Target: $79.00

  • Northern Minerals (NTU)

    • Upgraded to buy from hold at Ord Minnett; Price Target: $0.05

    • Retained at hold at Ord Minnett; Price Target: $0.04

  • Paladin Energy (PDN)

    • Retained at overweight at Morgan Stanley; Price Target: $17.45

  • Pioneer Credit (PNC)

    • Initiated at buy at Shaw and Partners; Price Target: $0.80

  • Qube Holdings (QUB)

    • Retained at accumulate at Ord Minnett; Price Target: $3.87

  • Regal Partners (RPL)

    • Retained at buy at Bell Potter; Price Target: $4.75 from $4.02

  • Siteminder (SDR)

    • Upgraded to overweight from marketweight at Wilsons; Price Target: $6.50 from $5.40

  • Santana Minerals (SMI)

    • Retained at buy at Bell Potter; Price Target: $2.15

  • Strike Energy (STX)

    • Retained at buy at Bell Potter; Price Target: $0.29

  • Treasury Wine Estates (TWE)

    • Retained at buy at UBS; Price Target: $15.00


Scans

Top Gainers

Code Company Last % Chg
HMD Heramed Ltd $0.022 +37.50%
BRX Belararox Ltd $0.26 +30.00%
BEO Beonic Ltd $0.029 +20.83%
8VI 8VI Holdings Ltd $0.12 +20.00%
DXN DXN Ltd $0.06 +20.00%
View all top gainers

Top Fallers

Code Company Last % Chg
GTE Great Western Exp... $0.033 -29.79%
EOF Ecofibre Ltd $0.06 -23.08%
G50 G50 Corp Ltd $0.12 -22.58%
WNR Wingara AG Ltd $0.011 -21.43%
RLF RLF Agtech Ltd $0.046 -20.69%
View all top fallers

52 Week Highs

Code Company Last % Chg
DXN DXN Ltd $0.06 +20.00%
OIL Optiscan Imaging Ltd $0.175 +16.67%
ELS Elsight Ltd $0.55 +14.58%
SUM Summit Minerals Ltd $0.335 +11.67%
WCN White Cliff Miner... $0.021 +10.53%
View all 52 week highs

52 Week Lows

Code Company Last % Chg
WNR Wingara AG Ltd $0.011 -21.43%
RLF RLF Agtech Ltd $0.046 -20.69%
PHO Phosco Ltd $0.033 -17.50%
BSN Basin Energy Ltd $0.065 -15.58%
WLD Wellard Ltd $0.017 -15.00%
View all 52 week lows

Near Highs

Code Company Last % Chg
VAF Vanguard Australi... $45.00 -0.42%
A2M The a2 Milk Compa... $7.10 -1.11%
SUBD Vaneck Australian... $25.12 0.00%
URW Unibail-Rodamco-W... $6.37 -2.45%
WTC Wisetech Global Ltd $99.60 -0.48%
View all near highs

Relative Strength Index (RSI) Oversold

Code Company Last % Chg
D3E D3 Energy Ltd $0.165 -2.94%
GRR Grange Resources Ltd $0.345 -5.48%
AEE Aura Energy Ltd $0.13 -10.35%
KAR Karoon Energy Ltd $1.69 -0.30%
WLE Wam Leaders Ltd $1.28 -1.16%
View all RSI oversold

Written By

Carl Capolingua

Content Editor

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.

Get the latest news and insights direct to your inbox

Subscribe free

Get free post-market insights with our Evening Wrap

Create an account to receive our concise, data-driven post-market recap, sent directly to your inbox, every day.

Along with the Evening Wrap, you'll join 100k+ investors who receive our Morning Wrap and Weekend Newsletter.