Market Wraps

Evening Wrap: ASX 200 soars on global risk-on, lack of big stick from RBA, uranium stocks rip again

Tue 07 May 24, 5:40pm (AEST)

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Share article

The S&P/ASX 200 closed 110.9 points higher, up 1.44%.

Sell in May and go away?

Historically, this hasn't been a crazy thing for investors to do. Today's stonking gain could be the start of the rally that presents you with the big opportunity to do just that – so you might want to pay extra special attention from here.

The RBA spared the rod (and spoiled us children), and Uranium stocks had a ripper day...again!

Let's dive in!


Today in Review

Tue 07 May 24, 4:33pm (AEST)

Name Value % Chg
Major Indices
ASX 200 7,793.3 +1.44%
All Ords 8,065.5 +1.42%
Small Ords 3,059.5 +1.59%
All Tech 3,068.1 +1.62%
Emerging Companies 2,231.2 +1.34%
Currency
AUD/USD 0.659 -0.53%
US Futures
S&P 500 5,207.25 +0.01%
Dow Jones 39,011.0 +0.04%
Nasdaq 18,183.75 -0.06%
Name Value % Chg
Sector
Utilities 8,982.9 +2.82%
Consumer Discretionary 3,520.0 +1.91%
Energy 10,261.0 +1.69%
Industrials 6,964.6 +1.58%
Information Technology 2,258.3 +1.52%
Materials 18,256.7 +1.47%
Real Estate 3,675.5 +1.38%
Communication Services 1,505.2 +1.32%
Financials 7,385.4 +1.31%
Health Care 42,657.0 +1.28%
Consumer Staples 11,702.8 +1.02%

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Markets

S&P ASX 200 (XJO) Intraday Chart 07 May 2024
ASX 200 Session Chart

The S&P/ASX 200 (XJO) finished 110.9 points higher at 7,793.3, smack-bang on its session high. In the broader-based S&P/ASX 300 (XKO), advancers beat decliners by an impressive 238 to 41.

You guessed it, with a candle like the one you’ll see in ChartWatch below, all 11 of the major ASX sectors were up today. There’s still an interest rate sensitive skew to the winners, with the Utilities (XUJ) (+2.8%) and Consumer Discretionary (XDJ) (+1.9%) sectors taking out the top two positions on the sector performance table.

To be fair, Utilities is basically just two stocks in terms of market cap, and one of those, AGL Energy (ASX: AGL) popped over 7% today on the back of improved FY24 profit guidance.

Also doing well today was the Gold (XGD) (+1.9%) sub-index. It bounced back due to a firming of the gold price overnight. But, there's possibly also an element of generally positive broker ratings and price target changes post gold companies' recent quarterly results, as well as generally positive sentiment towards gold in general. For example, I came across a Citi report today which tipped "$3,000/oz gold over the next 12-15m".

Company

Last Price

Change $

Change %

1mo %

1yr %

Bellevue Gold (BGL)

$1.760

+$0.085

+5.1%

-6.6%

+27.5%

Genesis Minerals (GMD)

$1.790

+$0.08

+4.7%

-3.5%

+38.8%

Perseus Mining (PRU)

$2.32

+$0.1

+4.5%

+3.6%

+4.5%

West African Resources (WAF)

$1.415

+$0.06

+4.4%

+7.6%

+41.5%

St Barbara (SBM)

$0.255

+$0.01

+4.1%

+24.4%

-14.5%

Resolute Mining (RSG)

$0.435

+$0.015

+3.6%

-6.5%

-15.5%

Emerald Resources (EMR)

$3.49

+$0.09

+2.6%

+4.8%

+81.8%

De Grey Mining (DEG)

$1.265

+$0.03

+2.4%

-1.6%

-18.9%

Westgold Resources (WGX)

$2.20

+$0.05

+2.3%

-3.5%

+32.5%

Red 5 (RED)

$0.440

+$0.01

+2.3%

+14.3%

+158.8%

Gold stocks shone brightly today, extending their gains from yesterday

The worst couple of sectors were still up over 1% – so nobody really did it that tough today. Still, it wasn’t a surprise to see one of the worst performing sectors of the last couple of weeks, Consumer Staples (XSJ) (+1.0%), at the bottom of the sector performance table.

Special mentions? Uranium stocks had another good day today, but you either already knew this because you're all over them, or you don't have any exposure and you'd rather I not say it again (for about the hundredth day in a row)!

Company

Last Price

Change $

Change %

1mo %

1yr %

Paladin Energy (PDN)

$16.96

+$1.32

+8.4%

+19.4%

+175.8%

Lotus Resources (LOT)

$0.475

+$0.035

+8.0%

+11.8%

+143.6%

Alligator Energy (AGE)

$0.064

+$0.003

+4.9%

+1.6%

+100.0%

Peninsula Energy (PEN)

$0.120

+$0.005

+4.3%

-7.7%

-22.6%

Nexgen Energy (NXG)

$13.20

+$0.52

+4.1%

+3.2%

+140.9%

Deep Yellow (DYL)

$1.675

+$0.06

+3.7%

+20.5%

+225.2%

Boss Energy (BOE)

$5.62

+$0.2

+3.7%

+11.7%

+129.4%

Bannerman Energy (BMN)

$4.69

+$0.11

+2.4%

+18.7%

+255.3%

Do you really want to know?

ChartWatch

S&P/ASX 200 (XJO)

S&P ASX 200 XJO 7 May 2024
Tuesday's candle indicates a strong demand-side showing

Big white candle. What does it mean? πŸ€”

1. Motivated buyers – "Let me in, I don't care what I pay...just let me in!"

2. Reluctant sellers – "Oh, you want my shares? Well, I couldn't possibly let you have them for that much. Oh, that much, well, (sighs), ok then". (Seconds later: "Darn I should have waited for more...I better not sell any more / I want to get back in!")

Big white candle on low volume. What does it mean? πŸ€”

1. Motivated demand (i.e., bidding up prices) was chasing very few shares for sale.

2. Sellers are likely holding out for more.

Close at the high. What does it mean? πŸ€”

1. (Buyers:) At the end of the day, prices are much higher than yesterday, but I don't care – let me in!

2. (Sellers:) At the end of the day, prices are much higher than yesterday, but I don't care – I still won't sell!

Economics 101 suggests that when the price of something goes up there should be more supply of that something. What does a big white candle which closes on the high of the session tell you about this concept? Prices went up, yet there was just as little supply.

Nobody knows what's going to happen tomorrow – the future is unwritten. But we can infer from the price action what is more likely to occur all things being equal (i.e., assuming the demand-supply environment isn't impacted by new information).

Given this, I have a question for you! What does today's candle infer about tomorrow's likely direction in Aussie share prices?

Always remember: Good technical analysis is simply the study of demand and supply. How they interact, how they change, and they manifest themselves in price. Never complicate it more than this! (Oh, and can I say: All hail the long term uptrend ribbon! πŸ’ͺ)


Economy

Today

  • AUS RBA Cash Rate, Monetary Policy Statement, Monetary Policy Statement

    • No change to official cash rate of 4.35%

    • Key omissions in May statement versus March statement:

      • March: Recent information suggests inflation continues to moderate, ***in line with the RBA’s latest forecasts***

      • Now: ***but is declining more slowly than expected***

      • Leaves out: While there are encouraging signs that inflation is moderating

      • March: While recent data indicate inflation is easing, it remains high.

      • Now: While inflation is easing, ***it is doing so more slowly than previously expected*** and it remains high.

    • Reserve Bank Governor Michelle Bullock said in response to our own Ally Selby's question: "I think we've always felt that it was a bit too soon to declare victory, and I think that the numbers in recent weeks have demonstrated that for us. We think policy is restrictive, we don't think we necessarily think we have to tighten again, but we can't rule it out. If we have to, we will."

For full coverage of the RBA's decision and post-meeting press conference, check out this article.

Later this week

Friday

  • 03:00 USA 30 year bond auction

Saturday

  • USA Preliminary University of Michigan Consumer Sentiment

    • Expected -0.9% to 76.3% vs -0.9% to 77.2% in April


Latest News


Interesting Movers

Trading higher

  • +12.1% Sayona Mining (SYA) - Lithium carbonate prices were up again today in China, still, a big jump on decent volume without any news πŸ€”

  • +8.5% Latin Resources (LRS) - No news, rise is consistent with prevailing short and long term uptrends πŸ”ŽπŸ“ˆ

  • +8.4% Paladin Energy (PDN) - No news, Aussie U-stocks keep ripping! Rise is consistent with prevailing short and long term uptrends πŸ”ŽπŸ“ˆ

  • +8.0% Lotus Resources (LOT) - No news, Aussie U-stocks keep ripping! Rise is consistent with prevailing short and long term uptrends πŸ”ŽπŸ“ˆ

  • +7.4% AGL Energy (AGL) - Updated FY24 Guidance, rise is consistent with prevailing short term uptrend, long term uptrend is transitioning from down to up, bounced off long term trend ribbon πŸ”ŽπŸ“ˆ

  • +6.9% OOH!Media (OML) - No news, continues to bounce off long term uptrend ribbon πŸ”ŽπŸ“ˆ

  • +6.9% The Star Entertainment Group (SGR) - No news πŸ€”

  • +6.8% HMC Capital (HMC) - Macquarie Conference Presentation, continues to bounce off long term uptrend ribbon πŸ”ŽπŸ“ˆ

  • +6.7% Cettire (CTT) - No news πŸ€”

  • +6.5% Lycopodium (LYL) - No news, rise is consistent with prevailing short and long term uptrends πŸ”ŽπŸ“ˆ

  • +6.1% WA1 Resources (WA1) - No news, rise is consistent with prevailing short and long term uptrends πŸ”ŽπŸ“ˆ

Trading lower

  • -11.9% Omni Bridgeway (OBL) - No news, fall is consistent with prevailing short and long term downtrends πŸ”ŽπŸ“‰

  • -6.4% Sims (SGM) - Trading Update, fall is consistent with prevailing short and long term downtrends πŸ”ŽπŸ“‰

  • -5.8% Lindsay Australia (LAU) - Trading Update FY2024, fall is consistent with prevailing short term downtrend, long term is transitioning from up to down πŸ”ŽπŸ“‰

  • -4.3% Imdex (IMD) - Macquarie Australia Conference Presentation 2024

  • -3.4% Bapcor (BAP) - Downgraded to hold from buy at Jefferies and price target cut to $5.30 from $7.15, fall is consistent with prevailing short and long term downtrends πŸ”ŽπŸ“‰

  • -3.4% Southern Cross Electrical Engineering (SXE) - Pullback from yesterday's massive gain following Profit guidance announcement

  • -3.1% Graincorp Class A (GNC) - Downgraded to hold from buy at Jefferies and price target cut to $9.20 from $9.30


Broker Notes

  • Bapcor (BAP)

    • Downgraded to hold from buy at Jefferies; Price Target: $5.30 from $7.15

  • Chrysos Corporation (C79)

    • Retained at buy at Shaw and Partners; Price Target: $7.50

  • Comet Ridge (COI)

    • Downgraded to hold from buy at Canaccord Genuity; Price Target: $0.21

  • Cyclopharm (CYC)

    • Retained at buy at Bell Potter; Price Target: $3.40 from $3.80

  • Endeavour Group (EDV)

    • Retained at buy at Goldman Sachs; Price Target: $6.30 from $6.20

    • Retained at overweight at Jarden; Price Target: $6.30 from $6.40

    • Retained at overweight at JP Morgan; Price Target: $6.00

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

    • Retained at hold at Morgans; Price Target: $5.20

    • Retained at buy at UBS; Price Target: $6.00

  • Elders (ELD)

    • Retained at buy at Citi; Price Target: $8.50

  • Goodman Group (GMG)

    • Retained at buy at Citi; Price Target: $32.50

  • Graincorp Class A (GNC)

    • Retained at buy at Bell Potter; Price Target: $9.20 from $9.30

    • Downgraded to hold from buy at Jefferies; Price Target: $9.10 from $9.65

  • Liontown Resources (LTR)

    • Initiated at buy at Argonaut Securities; Price Target: $1.60

    • Retained at buy at Bell Potter; Price Target: $1.85

  • Megaport (MP1)

    • Retained at buy at Citi; Price Target: $16.05 from $16.80

  • Macquarie Group (MQG)

    • Retained at sell at Citi; Price Target: $176.00 from $161.00

  • Propel Funeral Partners (PFP)

    • Retained at overweight at Morgan Stanley; Price Target: $6.30

  • Pilbara Minerals (PLS)

    • Initiated at buy at Argonaut Securities; Price Target: $5.10

  • QBE Insurance Group (QBE)

    • Retained at buy at Citi; Price Target: $19.50 from $18.00

  • Regis Resources (RRL)

    • Retained at sell at Citi; Price Target: $1.70 from $1.30

    • Retained at overweight at Morgan Stanley; Price Target: $2.45

  • Smart Parking (SPZ)

    • Retained at buy at Shaw and Partners; Price Target: $0.70

  • Strike Energy (STX)

    • Initiated at sector perform at RBC Capital Markets; Price Target: $0.22

  • Southern Cross Electrical Engineering (SXE)

    • Retained at buy at Shaw and Partners; Price Target: $1.70 from $1.50

  • Transurban Group (TCL)

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

    • Retained at neutral at Goldman Sachs; Price Target: $13.10

    • Retained at equal-weight at Morgan Stanley; Price Target: $13.06 from $13.68

  • Westpac Banking Corporation (WBC)

    • Retained at overweight at Barrenjoey; Price Target: $27.00 from $26.00

    • Retained at sell at Citi; Price Target: $22.25

    • Retained at neutral at Goldman Sachs; Price Target: $24.10 from $23.71

    • Retained at underperform at Jefferies; Price Target: $20.00 from $18.50

    • Retained at neutral at JP Morgan; Price Target: $25.00 from $24.30

    • Retained at underweight at Morgan Stanley; Price Target: $24.40 from $23.00


Scans

Top Gainers

Code Company Last % Chg
ADY Admiralty Resourc... $0.012 +50.00%
FGL Frugl Group Ltd $0.11 +41.03%
BUR Burley Minerals Ltd $0.073 +40.39%
OZZ OZZ Resources Ltd $0.042 +35.48%
PEC Perpetual Resourc... $0.012 +33.33%
View all top gainers

Top Fallers

Code Company Last % Chg
SNX Sierra Nevada Gol... $0.04 -21.57%
SVG Savannah Goldfiel... $0.028 -20.00%
SNS Sensen Networks Ltd $0.022 -18.52%
AFA Asf Group Ltd $0.04 -18.37%
BCK Brockman Mining Ltd $0.02 -16.67%
View all top fallers

52 Week Highs

Code Company Last % Chg
ADY Admiralty Resourc... $0.012 +50.00%
M4M Macro Metals Ltd $0.026 +23.81%
TTT Titomic Ltd $0.076 +22.58%
SXG Southern Cross Go... $2.85 +17.28%
AUE Aurum Resources Ltd $0.365 +12.31%
View all 52 week highs

52 Week Lows

Code Company Last % Chg
SNX Sierra Nevada Gol... $0.04 -21.57%
AFA Asf Group Ltd $0.04 -18.37%
BCK Brockman Mining Ltd $0.02 -16.67%
PFT Pure Foods Tasman... $0.035 -16.67%
VN8 VONEX Ltd $0.011 -15.39%
View all 52 week lows

Near Highs

Code Company Last % Chg
A1M Aic Mines Ltd $0.485 -2.02%
A2M The a2 Milk Compa... $6.13 +1.16%
AFI Australian Founda... $7.24 +0.56%
SIG Sigma Healthcare Ltd $1.285 -0.39%
SPZ Smart Parking Ltd $0.485 -1.02%
View all near highs

Relative Strength Index (RSI) Oversold

Code Company Last % Chg
WDS Woodside Energy G... $27.84 +1.87%
OBL Omni Bridgeway Ltd $0.925 -11.91%
ALD Ampol Ltd $36.00 +1.18%
SPK Spark New Zealand... $4.02 -1.23%
AVH Avita Medical Inc $2.78 +4.91%
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.

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