Evening Wrap: ASX 200 smashes another record as gold and uranium stocks surge, but lithium and iron ore back in doldrums

The S&P/ASX 200 closed 71.2 points higher, up 0.86%.

Another stonking record close for the S&P/ASX200 with most sectors coming along for the journey. There were plenty of highlights, and we will discuss them in the main Wrap, but I must single out for special attention strong gains in the uranium sector today. Also doing well, and this is a bit of a theme lately, was the gold sector – it logged yet another big gain.

There were a few laggards though, lithium stocks slumped under the weight of another record low close in a key lithium contact today, as did iron ore stocks as the iron ore price also broke to the downside in Singapore.

Click/scroll through for the usual reporting of the major sector and stock-specific moves, the broker responses to them, as well as all of the key upcoming economic data in tonight's Evening Wrap.

Also, I have detailed technical analysis on Iron Ore in today's ChartWatch.

Let's dive in!

Markets

ASX 200 Session Chart

The S&P/ASX 200 (XJO) finished 71.2 points higher at 8,355.9, 0.86% from its session low and 0.34% from its high. In the broader-based S&P/ASX 300 (XKO), advancers beat decliners by an impressive 210 to 75.

The Gold (XGD) (+2.2%) sub-index was again the best performing sector today. This is either becoming monotonous to hear (if you don’t have any our surging gold stocks), or it’s music to your ears. Hopefully it’s the latter!

It is interesting to see some of the brokers bailing out of buy-or-buy-equivalent ratings for several stocks within the sector, albeit frantically raising price targets to catch up to spot. See this article I wrote today for details of which ASX gold stocks have been downgraded recently, and I note another couple of downgrades for Evolution Mining (ASX: EVN) (+0.8%) today (see Broker Moves section below).

Also doing well today was the Industrials (XNJ) (+1.8%) sector. It’s pretty rare to see this one anywhere but in the middle of the daily sector performance table, but today it was helped by strong gains in uranium technology company Silex Systems (ASX: SLX) (+13.6%) as well as sector heavyweights Brambles (ASX: BXB) (+3.2%) and Qantas Airways (ASX: QAN) (+2.3%).

Silex is an interesting story, or at least ASX uranium today is an interesting story – because there was no specific news for Silex itself – go figure. But I do note that uranium prices are firming, there was also some more “mega tech company is investing in long term nuclear power production” (this time Amazon), as well as two separate substantial shareholder notice increases by Sprott for Deep Yellow (ASX: DYL) (+7.3%) and Lotus Resources (ASX: LOT) (+13%).

Not so rarely near the top of the sector performance table was today’s third best sector, Financials (XFJ) (+1.7%). AMP (ASX: AMP) (+17.7%) was by far the biggest winner here as investors scrambled to buy in after the company provided a September quarter cash flow and business update.

Today’s best performing stocks from today’s best performing sectors

Only two sectors dipped into the red today, Information Technology (XIJ) (-1.1%) and Resources (XJR) (-0.40%). Most of the damage in the XIJ was at the hands of sector heavyweights Wisetech Global (ASX: WTC) (-3.0%) and Technology One (ASX: TNE) (-1.6%) – no news for either – likely just sector rotation shenanigans, while the XJR was weighed down by the iron ore majors which were each down by over one percent today as the iron ore price fell sharply in Singapore trade.

Today’s worst performing stocks from today’s worst performing sectors

Iron Ore 62- (Front month, back-adjusted) SGX

That seasonal rally want to kick in right about...now... (click here for full size image)

The last time we covered iron ore was in ChartWatch in the Evening Wrap on 8 October.

In that update, we were monitoring some “very active and very credible excess supply” in the critical 113.70-114.30. That supply was manifesting itself in a tell-tale black-bodied candle with long upward pointing shadow into the supply zone.

The above chart shows that candle stamped the supply side’s unequivocal control on the iron ore price, and the demand side has dutifully crumbled since. We can see a return to falling peaks and falling troughs, as wells as several more supply-side candles.

Today’s candle is equally as important as the one we were mulling our 8 Oct update. It’s still live, so we cannot yet trust it completely, but it is another important supply-side showing, potentially crushing demand at the 103.05-105.90 demand zone, as well as threatening a close below the crucial dynamic demand we’d normally expect in the short term uptrend ribbon.

If you wake up tomorrow and the candle has indeed confirmed all of these things, then it is likely that the fabled iron ore end of year seasonal rally is delayed.

The next point of demand is 95.60, and below that, all the way down at 88.45-89.25.

109.05 and really everything all the way back up to 115 is supply.

Economy

Today

• AUS Employment Change September

  • +64,100 vs +25,200 forecast and +42,600 (revised down from +47,500) in August

  • Unemployment rate steady at 4.2%

  • Participation rate hit another record high at 67.2%

  • Massive beat (the sixth straight beat) shows the Australian labour market is extremely strong and will likely force the RBA to hold off on the first rate cut for even longer

Later this week

Thursday

• 23:15 EUR ECB Main Financing Rate (-0.25% to 3.4% forecast)

• 11:30 USA Core Retail Sales September (+0.1% m/m forecast vs +0.1% m/m in August)

• 23:45 EUR ECB Press Conference

Friday

• 01:00 USA NAHB Housing Market Index October (43 forecast vs 41 September)

• 13:00 CHN "Data Dump"

  • GDP September (+4.6% p.a. vs +4.7% p.a. previous)

  • Industrial Production (+4.6% p.a. vs +4.5% p.a. previous)

  • Retail Sales (+2.3% p.a. vs +2.8% p.a. previous)

  • Fixed Asset Investment (+3.3% year to date vs previous corresponding period)

  • Unemployment Rate

• 23:30 USA Building Permits September (1.45 million forecast vs 1.48 million August) & Housing Starts September (1.35 million forecast vs 1.36 million August)

Latest News

Interesting Movers

Trading higher

• +27.3% Lake Resources (LKE) - No news, rise is consistent with prevailing short term uptrend, closed in the long term downtrend ribbon for the first time since November 2022!

• +17.7% AMP (AMP) - AMP Limited provides Q3 24 cashflows and business update, rise is consistent with prevailing short and long term uptrends (was a Feature chart in today's ChartWatch Daily Scans Uptrends) 🔎📈

• +13.9% Cettire (CTT) - No news, rise is consistent with prevailing short term uptrend, long term trend is transitioning from down to up, closed above the long term trend ribbon (watch tomorrow's ChartWatch Scans Uptrends list, this will be in it!) 🔎📈

• +13.7% The Star Entertainment Group (SGR) - NICC response to Bell Two & revised Remediation Plan update

• +13.6% Silex Systems (SLX) - No news, part of a strong rally in ASX uranium stocks today, uranium price up Weds, plus Amazon investing nuclear energy production, and Sprott increased interest in DYL and LOT, rise is consistent with prevailing short term uptrend, long term trend is transitioning from down to up, closed above the long term trend ribbon (was a Feature chart in ChartWatch Scans just yesterday!) 🔎📈

• +13.4% Ora Banda Mining (OBM) - September 2024 Quarterly Activities Report, rise is consistent with prevailing short and long term uptrends (OBM is one of the most Featured charts in ChartWatch Daily Scans Uptrends since I started the series back in May) 🔎📈

• +13.0% Lotus Resources (LOT) - Change in substantial holding (Sprott increase), ditto strong rally in ASX uranium stocks

• +11.0% Paladin Energy (PDN) - No news, ditto strong rally in ASX uranium stocks

• +10.4% Westgold Resources (WGX) - No news, generally stronger ASX gold sector, has bounced strongly from the long term uptrend ribbon 🔎📈

• +9.6% Nexgen Energy (NXG) - No news, ditto strong rally in ASX uranium stocks (was a Feature chart in ChartWatch Scans just Tuesday!) 🔎📈

• +9.3% Bannerman Energy (BMN) - No news, ditto strong rally in ASX uranium stocks (was a Feature chart in ChartWatch Scans just last week!) 🔎📈

• +7.3% Deep Yellow (DYL) - Change in substantial holding (Sprott increase), ditto strong rally in ASX uranium stocks (appeared in ChartWatch Scans just Yesterday!) 🔎📈

• +6.7% Boss Energy (BOE) - No news, ditto strong rally in ASX uranium stocks

• +6.5% Develop Global (DVP) - No news, rise is consistent with prevailing short term uptrend, long term trend is transitioning from down to up (appeared in ChartWatch Scans just Yesterday!) 🔎📈

Trading lower

• -35.7% OFX Group (OFX) - Update on 1H25 Trading

• -6.9% Appen (APX) - Notice under section 708A(5)(e) of the Corporations Act

• -6.9% DUG Technology (DUG) - Successful Completion of Institutional Placement and Investor Presentation, also downgraded to neutral from positive at E&P and price target cut to $2.86 from $3.99

• -6.1% Brainchip (BRN) - No news continues sharp pullback from early October rally

• -4.9% Novonix (NVX) - No news, similar setup to BRN, testing back into the long term trend ribbon…

• -4.5% Healius (HLS) - No news

• -4.0% Wildcat Resources (WC8) - No news, generally weaker ASX lithium sector today on benchmark Nov024 GFEX lithium carbonate futures probing new all time lows...

• -4.0% Challenger (CGF) - First quarter update, see also several broker updates in Broker Moves section below

• -3.8% Mineral Resources (MIN) - Ditto tough day for ASX lithium sector, iron ore price also sharply lower in Singapore to boot!

Broker Notes

• Atlantic Lithium (A11)

  • Downgraded to neutral from outperform at Macquarie; Price Target: $0.30

• ARB Corporation (ARB)

  • Retained at buy at Citi; Price Target: $48.00

• Bapcor (BAP)

  • Retained at hold at Ord Minnett; Price Target: $5.30 from $5.40

• Bluebet (BBT)

  • Retained at add at Morgans; Price Target: $0.33

• BHP Group (BHP)

  • Retained at buy at Citi; Price Target: $46.00

• Bannerman Energy (BMN)

  • Retained at buy at Shaw and Partners; Price Target: $7.40

• Bank of Queensland (BOQ)

  • Retained at sell at Citi; Price Target: $5.30

  • Upgraded to hold from underperform at CLSA; Price Target: $6.40 from $5.10

  • Retained at underweight at JP Morgan; Price Target: $5.50 from $5.20

  • Retained at underperform at Macquarie; Price Target: $5.50 from $5.00

  • Retained at underweight at Morgan Stanley; Price Target: $6.10 from $5.70

  • Retained at sell at UBS; Price Target: $5.75 from $5.50

• Challenger (CGF)

  • Retained at buy at Citi; Price Target: $7.80 from $8.30

  • Retained at outperform at Macquarie; Price Target: $7.10 from $7.20

  • Retained at equal-weight at Morgan Stanley; Price Target: $7.20

  • Retained at ADD at Morgans; Price Target: $8.20 from $8.60

• Catalyst Metals (CYL)

  • Retained at buy at Bell Potter; Price Target: $4.30 from $3.90

• DUG Technology (DUG)

  • Downgraded to neutral from positive at E&P; Price Target: $2.86 from $3.99

• Evolution Mining (EVN)

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

  • Retained at hold at CLSA; Price Target: $5.05 from $4.20

  • Downgraded to underweight from neutral at JP Morgan; Price Target: $4.10

  • Downgraded to neutral from outperform at Macquarie; Price Target: $4.60 from $4.50

  • Retained at equal-weight at Morgan Stanley; Price Target: $4.25

  • Retained at hold at Ord Minnett; Price Target: $4.60 from $4.70

  • Retained at underperform at RBC Capital Markets; Price Target: $3.80 from $3.40

• Galan Lithium (GLN)

  • Retained at neutral at Macquarie; Price Target: $0.14 from $0.12

• Incitec Pivot (IPL)

  • Upgraded to outperform from sector perform at RBC Capital Markets; Price Target: $3.60 from $3.20

• Peninsula Energy (PEN)

  • Retained at buy at Shaw and Partners; Price Target: $0.26

• Qoria (QOR)

  • Retained at buy at Ord Minnett; Price Target: $0.51 from $0.47

  • Retained at buy at Shaw and Partners; Price Target: $0.52

• Rio Tinto (RIO)

  • Retained at buy at Goldman Sachs; Price Target: $136.20 from $136.60

  • Downgraded to neutral from outperform at Macquarie; Price Target: $119.00 from $120.00

  • Retained at overweight at Morgan Stanley; Price Target: $135.00

  • Retained at add at Morgans; Price Target: $127.00 from $128.00

  • Retained at buy at Ord Minnett; Price Target: $133.00

  • Retained at sector perform at RBC Capital Markets; Price Target: $123.00 from $125.00

  • Retained at neutral at UBS; Price Target: $124.00 from $126.00

• Smartpay (SMP)

  • Retained at hold at Bell Potter; Price Target: $0.75 from $1.30

• Santos (STO)

  • Retained at neutral at Citi; Price Target: $8.00

• Southern Cross Gold (SXG)

  • Retained at buy at Shaw and Partners; Price Target: $3.26

• Transurban Group (TCL)

  • Retained at neutral at Macquarie; Price Target: $13.00

• The Reject Shop (TRS)

  • Retained at equal-weight at Morgan Stanley; Price Target: $3.40

• Treasury Wine Estates (TWE)

  • Retained at neutral at Citi; Price Target: $12.97

  • Retained at outperform at CLSA; Price Target: $16.50

  • Retained at buy at Goldman Sachs; Price Target: $15.20

  • Retained at buy at Jefferies; Price Target: $15.50

  • Retained at outperform at Macquarie; Price Target: $13.90

• Woodside Energy Group (WDS)

  • Retained at neutral at Goldman Sachs; Price Target: $27.20

  • Retained at neutral at Jarden; Price Target: $26.80 from $26.60

  • Retained at overweight at JP Morgan; Price Target: $31.00

  • Retained at neutral at Macquarie; Price Target: $27.00

  • Retained at equal-weight at Morgan Stanley; Price Target: $29.00

  • Retained at add at Morgans; Price Target: $33.00

  • Retained at hold at Ord Minnett; Price Target: $26.50 from $26.00

  • Retained at outperform at RBC Capital Markets; Price Target: $34.00 from $33.50

  • Retained at neutral at UBS; Price Target: $28.30 from $28.10

• Webjet (WJL)

  • Initiated at overweight at JP Morgan; Price Target: $1.20

• Xero (XRO)

  • Retained at buy at UBS; Price Target: $175.00 from $154.00

Scans