Evening Wrap: ASX 200 stalls around nine month highs, uranium and BNPL stocks surge

Welcome back to the first Evening Wrap for 2023! Today will be rather short and sweet as the market begins to stall after a massive rally from recent lows. Some sectors to note include lithium, uranium and junky tech.

Let's dive in.

Markets

The ASX 200 closed around breakeven after a brief 0.28% rally at the open. Is the market beginning to stall after an outsized 7.4% rally since the 3 January low?

• Tech stocks led thanks to an outsized 2.66% move by the Nasdaq. Some notable movers include Xero (+1.4%), Altium (+1.4%) and Block (+6.1%)

• Energy outperformed with Woodside Energy shares up 1.7% to a two month high. This follows a 1.1% increase in crude oil prices last Friday, to a likewise two month high

• Utilities was the worst performing sector following declines from names like Origin Energy (-0.55%), Meridian Energy (-1.8%) and AGL (-1.9%)

• 107 of the top 200 advanced (54%)

Economy

The Bank of Japan was scheduled to meet at 10:50 am AEDT. The meeting was suspended at the government's request, the first since June 2021.

Latest news

Post market brief

The ASX 200 has staged a V-shaped rally into 9 month highs. I'm sure investors can't help but to feel a pullback of some sort is brewing after such an outsized rally.

XJO chart (Source: TradingView)

The rest of the post market brief will be short but hopefully sweet. A few sectors to note:

Lithium: We're beginning to see some life come back into lithium stocks after a rather sharp selloff last December. Pilbara Minerals has now rallied 20.2% in the last two sessions. As the stock gets more extended (given its vertical bounce), it would be healthy to see a pullback, which would also give us feedback about the underlying health of the lithium heavyweight.

Junk names: BNPL names staged a wild rally, with Zip up 22.8% and Sezzle up 38.9%. Of note, Zip experienced a 30.9m volume versus its 20-day average of just 8m. Is this what a turnaround looks like? Or just a dead cat bounce for a name that's down more than 90% from all-time highs?

Uranium: Uranium stocks, more broadly speaking, went nowhere in 2022. Spot prices were rather stubborn despite bullish headlines like the energy crisis, Japan's turnaround for nuclear energy, China ramping up nuclear reactors etc. Monday witnessed a broad-based rally for the uranium sector, with notable movers like Aura Energy (+11.7%), Boss Energy (+7.9%) and Deep Yellow (+7.3%). Will 2023 be the year that uranium stocks move? Or just another sideways chop?

Interesting news and movers

We will be swapping out the coverage of most major announcements to more interesting news and movers.

Trading higher

• Zip (ZIP) +22.8% – BNPL sector move

• Kargoon Energy (KAR) +7.4% – Reports 23% increase in Bauna 2P Reserves

• Deep Yellow (DYL) +7.3% – Uranium sector rally

• Pilbara Minerals (PLS) +6.2% – Upgraded to overweight at Barrenjoey plus sector rally

• Block (SQ2) +6.1% – BNPL sector move 

Trading lower 

• Stanmore Resources (SMR) -6.6% – Reports Q4 production plus general coal sector weakness

• Terracom (TER) -3.4% – Reports Q2 operating EBITDA

Trading halts

Broker updates 

Scans