Evening Wrap: ASX 200 slips as fading rate cut hopes hobble consumer stocks, lithium sector logs solid gains

The S&P/ASX 200 closed 9.2 points lower, down 0.10%.

Lithium stocks rallied strongly today with Liontown Resources (LTR), Pilbara Minerals (PLS), and Mineral Resources (MIN) leading the way. More broadly, these and other critical minerals stocks were still in vogue... but definitely out of vogue – consumer stocks... they're not liking interest rate markets factoring out at least one of the last two potential RBA rate cuts!

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 9.2 points lower at 8,947.6, 0.35% from its session low and 0.18% from its high/low. In the broader-based S&P/ASX 300 (XKO) advancers lagged decliners by 113 to 166.

Fund flows: Ditto, except Healthcare ⬆️ & Gold ⬇️

Look at today’s losing sectors… they’re all the same ones we’ve been talking about here each evening for the last couple of weeks. Interest rate cut-dashed / bond proxies / long duration… Oh, and of course there's perennial dog Energy (XEJ) (-0.61%)!

If you've been watching ChartWatch *Live* Webinars... what do you make of this chart 🧐📉? (click here for full size image)

So, it's no surprise to see these sectors lose ground today: Consumer Discretionary (XDJ) (-1.5%) and Consumer Staples (XSJ) (-0.60%) (rate cut-dashed), Information Technology (XIJ) (-1.2%) (long duration), Real Estate (XPJ) (-0.57%) and Utilities (-0.07%) (bond proxies), and Telecommunications Services (XTJ) (-1.1%) (50-50 bond proxies vs long duration).

Thankfully (at an index level at least), Financials (XFJ) (+0.03%) and Resources (+0.12%) helped neutralise losses on the benchmark ASX 200 (but this means there's a skew the wrong way in today's market breadth 113-166!).

Healthcare (XHJ) (+0.55%) was also solid, maybe a bit of a defensive flair there, with Resmed (RMD) (+1.7%) and Telix Pharma (TLX) (+1.6%) the best in the bigs, while ChartWatch ASX Scans Uptrends List constituents Mesoblast (MSB) (+9.4%), Artya (AYA) (+6.4%), Race Oncology (RAC) (+5.2%), and Clarity Pharma (CU6) (+4.1%) the best in the smalls.

The only one of note not mentioned is Gold (XGD) (-0.33%) – it took a break today despite higher gold and silver prices overnight – but ASX gold stocks don’t always follow the leads from physical, do they?

Stock specific: Lithium's decent today...🤔

No news that I could see to explain the strength here – Chinese lithium markets are still closed for Golden Week Holidays. Hong Kong lithium majors were up slightly, consolidating recent strong gains. US lithiums were much of a muchness overnight...

It just feels like a broad sector re-rating here... buying the dips, FOMO into the rallies... Is it short covering alone or is there some positional / re-rate stuff going on? Is it the case that lithium stocks are once again being grouped with "critical minerals" stocks (which have been melting up for the last few months)? Wow what an honour... Welcome back to the critical minerals fold ASX lithiums! 🥳

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)

The third “not ideal but not a deal breaker” candle in a row. The supply-side is having a look here, but to be honest, I don’t think they have it in them! Today's downward pointing shadow is perfect evidence of this – the demand-side has the supply-side pegged for now…

And that's even considering that over the last three sessions there's been little in the way of strong positive leads to support motivated demand.

So, I suggest those with cash are largely cooling their heels, those with stock are largely holding on for more (save a few stragglers and non-believers), and what’s left is largely a vacuum of interest both ways.

Most importantly though, net-net, there’s been little progress made by the supply-side over those last 3 candles. This means there’s been only a very shallow incursion into that last “motived up-phase”, which included decent demand-side candles on 29-Sep, 2-Oct, and 3-Oct.

The short term uptrend ribbon remains up and is unchallenged; we’re still showing rising peaks and rising troughs; the long term uptrend hasn’t been in question – even during that September Swoon wobble.

So, without a clear signal to do something (i.e., manage my risk), as a trend follower, my default option is to do nothing. Which is something in itself – because in this case it means sticking with the prevailing uptrend and FRP (Full Risk Position = My personal allowable capital allocation limit for my investments in Australian stocks is 100%).

Key levels: 8991-9055 is the key zone of supply, I will be very watchful for signs of excess supply in there. 8731 is the most important near-term point of demand, the price should not close below here if the demand-side is in control of the XJO’s price = ⚠️

ChartWatch went *LIVE* today! Watch the video of today's webinar here 📺: ChartWatch *LIVE* Webinar: How to spot ASX opportunities and risks with technical analysis

Economy

Today

• There weren't any major economic data releases in our time zone today

Later this week

Thursday

• 04:00 USA 10-y Bond Auction

• 05:00 USA September FOMC Meeting Minutes

• 11:00 AUS September MI Inflation Expectations (+4.7% p.a. in August)

• 23:30 USA Federal Reserve Chairman Jerome Powell speaks

Friday

• 12:00 AUS RBA Governor Michelle Bullock speaks

• 22:30 (Tentative due to shutdown) 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

• 01:00 USA October Preliminary UoM Consumer Sentiment (54.6 forecast vs 55.1 previous)

• 01:00 USA October Preliminary UoM Inflation Expectations (+4.7% p.a. in September)

Latest News

Interesting Movers

Trading higher

• +17.5% Cyprium Metals (CYM) – No news, rise is consistent with prevailing short and long term uptrends 🔎📈

• +16.5% Podium Minerals (POD) – No news, rise is consistent with prevailing short and long term uptrends, a recent regular in ChartWatch ASX Scans Uptrends list 🔎📈

• +16.3% Arafura Rare Earths (ARU) – No news, general strength across the broader Critical Minerals sector today, rise is consistent with prevailing short and long term uptrends, a recent regular in ChartWatch ASX Scans Uptrends list 🔎📈

• +15.4% Renascor Resources (RNU) – No news, general strength across the broader Critical Minerals sector today.

• +12.7% Minerals 260 (MI6) – Continued positive response to 7-Oct High-Grade Results to Support Bullabulling Resource Upgrade, rise is consistent with prevailing short and long term uptrends, a regular in ChartWatch ASX Scans Uptrends list 🔎📈

• +12.1% EQ Resources (EQR) – No news 🤔.

• +11.8% Novonix (NVX) – No news, general strength across the broader Critical Minerals sector today.

• +10.0% Andromeda Metals (ADN) – No news since 07-Oct HPA Project, Next phase of commercialisation underway, rise is consistent with prevailing short and long term uptrends, a recent regular in ChartWatch ASX Scans Uptrends list 🔎📈

• +9.9% James Hardie Industries (JHX) – Preliminary Second Quarter Results.

• +9.9% Imugene (IMU) – No news 🤔.

• +9.6% Antipa Minerals (AZY) – Change in substantial holding (Copia Investment Partners 7.3% to 8.5%), rise is consistent with prevailing short and long term uptrends, a regular in ChartWatch ASX Scans Uptrends list 🔎📈

• +9.4% Mesoblast (MSB) – Continued positive response to 07-Oct Ryoncil Revenues Increase 66% in Second Quarter Post Launch, rise is consistent with prevailing short and long term uptrends, a regular in ChartWatch ASX Scans Uptrends list 🔎📈

• +9.1% Almonty Industries (AII) – No news, rise is consistent with prevailing short and long term uptrends, one of the most Featured (highest conviction) stocks in ChartWatch ASX Scans Uptrends list 🔎📈

• +8.8% Beetaloo Energy Australia (BTL) – No news, rise is consistent with prevailing short and long term uptrends, a regular in ChartWatch ASX Scans Uptrends list 🔎📈

• +8.6% Turaco Gold (TCG) – Drilling Confirms Significant Discovery at Adiopan, Afema.

• +8.0% Boab Metals (BML) – No news, rise is consistent with prevailing short and long term uptrends, a regular in ChartWatch ASX Scans Uptrends list 🔎📈

• +7.8% Droneshield (DRO) – Landmark 4Q25 AI Software Release, rise is consistent with prevailing short and long term uptrends, a regular in ChartWatch ASX Scans Uptrends list 🔎📈

• +7.7% G50 Corp (G50) – No news, rise is consistent with prevailing short and long term uptrends, a regular in ChartWatch ASX Scans Uptrends list 🔎📈

• +7.6% Dimerix (DXB) – Successful PARASOL Collaboration Data Analysis Outcome, rise is consistent with prevailing short and long term uptrends 🔎📈

• +6.9% WIA Gold (WIA) – No news, rise is consistent with prevailing short and long term uptrends, a regular in ChartWatch ASX Scans Uptrends list 🔎📈

• +6.5% Acusensus (ACE) – Continued positive response to 07-Oct First major US state-wide automated enforcement contract, rise is consistent with prevailing short and long term uptrends, a regular in ChartWatch ASX Scans Uptrends list 🔎📈

• +6.5% Brainchip (BRN) – Continued positive response to 07-Oct Response to ASX Price Query.

• +6.4% Artrya (AYA) – Continued positive response to 07-Oct Huntsville Hospital Heart Centre Confirmed in SAPPHIRE Study, rise is consistent with prevailing short and long term uptrends, a regular in ChartWatch ASX Scans Uptrends list 🔎📈

Trading lower

• -25.2% Dateline Resources (DTR) – No news, pulled back in the wake of recent sharp rally.

• -22.6% Zenith Minerals (ZNC) – Further Red Mountain Results Confirm Substantial Scale & Depth, pulled back in the wake of recent sharp rally.

• -17.2% Sunrise Energy Metals (SRL) – No news, pulled back in the wake of recent sharp rally.

• -12.5% Trigg Minerals (TMG) – Geological Breakthrough At Antimony Canyon Patented Claims.

• -8.1% Dorsavi (DVL) – No news, pulled back after yesterday’s sharp rally due to dorsaVi Accelerates Growth in the US Physical Therapy Market.

• -8.1% Manuka Resources (MKR) – Corporate Presentation.

• -7.7% Amaero International (3DA) – No news, fall is consistent with prevailing short-term downtrend and long-term trend is transitioning from up to down, added to ChartWatch ASX Scans Downtrends list this morning 🔎📉

• -7.4% Locksley Resources (LKY) – Locksley Produces High Grade Antimony Concentrate.

Broker Moves

ASX (ASX)

• Retained at neutral at Macquarie; Price Target: $63.00 from $64.50

Bellevue Gold (BGL)

• Retained at speculative buy at Canaccord Genuity; Price Target: $1.75

BHP Group (BHP)

• Retained at overweight at Morgan Stanley; Price Target: $48.00 from $46.50

Boss Energy (BOE)

• Retained at underweight at Morgan Stanley; Price Target: $1.85 from $1.65

Bank of Queensland (BOQ)

• Retained at trim at Morgans; Price Target: $6.20 from $6.60

Brazilian Rare Earths (BRE)

• Retained at speculative buy at Canaccord Genuity; Price Target: $5.65

Capricorn Metals (CMM)

• Retained at buy at Argonaut Securities; Price Target: $17.00 from $15.30

Cochlear (COH)

• Upgraded to buy from hold at Canaccord Genuity; Price Target: $330.00

Catalyst Metals (CYL)

• Retained at buy at Canaccord Genuity; Price Target: $11.80

Deterra Royalties (DRR)

• Retained at equal-weight at Morgan Stanley; Price Target: $4.35 from $4.00

Evolution Mining (EVN)

• Retained at sell at UBS; Price Target: $7.90

Fortescue (FMG)

• Retained at overweight at Morgan Stanley; Price Target: $21.20 from $19.90

Greatland Resources (GGP)

• Retained at buy at Citi; Price Target: $9.00 from $8.70

Genesis Minerals (GMD)

• Retained at buy at UBS; Price Target: $6.50

Integral Diagnostics (IDX)

• Retained at buy at Bell Potter; Price Target: $4.00

IGO (IGO)

• Retained at underweight at Morgan Stanley; Price Target: $4.60 from $3.90

Iluka Resources (ILU)

• Retained at overweight at Morgan Stanley; Price Target: $8.60 from $6.40

ioneer (INR)

• Initiated at speculative buy at Bell Potter; Price Target: $0.36

Karoon Energy (KAR)

• Retained at buy at Citi; Price Target: $2.20 from $2.40

Kingsgate Consolidated (KCN)

• Retained at buy at Canaccord Genuity; Price Target: $5.50

Lynas Rare Earths (LYC)

• Downgraded to equal-weight from overweight at Morgan Stanley; Price Target: $19.45 from $14.75

Meteoric Resources NL (MEI)

• Upgraded to buy from hold at Bell Potter; Price Target: $0.25 from $0.14

Mineral Resources (MIN)

• Retained at overweight at Morgan Stanley; Price Target: $49.00 from $41.50

Mesoblast (MSB)

• Retained at speculative buy at Bell Potter; Price Target: $4.00 from $3.50

Northern Star Resources (NST)

• Retained at neutral at UBS; Price Target: $21.10

Ora Banda Mining (OBM)

• Retained at buy at Canaccord Genuity; Price Target: $1.30

Paladin Energy (PDN)

• Retained at buy at Canaccord Genuity; Price Target: $12.50 from $13.05

• Upgraded to overweight from equal-weight at Morgan Stanley; Price Target: $9.50 from $7.30

Pilbara Minerals (PLS)

• Retained at overweight at Morgan Stanley; Price Target: $2.85 from $2.30

Perseus Mining (PRU)

• Retained at buy at UBS; Price Target: $5.10

Ridley Corporation (RIC)

• Retained at buy at UBS; Price Target: $3.50 from $2.80

Rio Tinto (RIO)

• Retained at equal-weight at Morgan Stanley; Price Target: $129.50 from $121.00

• Retained at accumulate at Ord Minnett; Price Target: $127.00

Regis Resources (RRL)

• Retained at hold at Canaccord Genuity; Price Target: $5.45

• Retained at sell at UBS; Price Target: $5.40

South32 (S32)

• Retained at overweight at Morgan Stanley; Price Target: $3.25 from $3.30

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

Sandfire Resources (SFR)

• Retained at underweight at Morgan Stanley; Price Target: $11.45 from $8.35

Sky Metals (SKY)

• Retained at speculative buy at Bell Potter; Price Target: $0.12 from $0.08

Sunstone Metals (STM)

• Retained at speculative buy at Morgans; Price Target: $0.04 from $0.12

Turaco Gold (TCG)

• Retained at speculative buy at Canaccord Genuity; Price Target: $1.15

Vault Minerals (VAU)

• Retained at neutral at UBS; Price Target: $0.72

Veem (VEE)

• Downgraded to accumulate from buy at Morgans; Price Target: $1.66 from $1.30

WEB Travel Group (WEB)

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

• Retained at outperform at CLSA; Price Target: $6.65 from $6.70

• Retained at overweight at Jarden; Price Target: $5.40 from $5.30

• Retained at overweight at JPMorgan; Price Target: $6.00

• Retained at outperform at Macquarie; Price Target: $6.98 from $6.74

• Retained at underweight at Morgan Stanley; Price Target: $4.25

• Retained at buy at Ord Minnett; Price Target: $7.53 from $7.37

• Retained at buy at Shaw and Partners; Price Target: $6.40 from $6.30

• Retained at neutral at UBS; Price Target: $5.75

Whitehaven Coal (WHC)

• Retained at overweight at Morgan Stanley; Price Target: $8.00 from $8.30

Zip Co (ZIP)

• Retained at buy at Citi; Price Target: $4.50

Scans