• The ASX 200 index closed flattish on Monday
  • Lithium stocks declined, while Elders tumbled 13pc on a huge profit miss
  • A US default could trigger a volatility spike in the market – expert


The ASX 200 finished flat on Monday, with gains in Mining and Real Estate offset by losses in Banking stocks.

Lithium stocks were among the decliners today, while gold stocks rose.

The spot gold price is currently trading at US$2,016.30 an ounce, driven a little lower by a strong greenback.

“…the macro backdrop for gold is great. We are still looking at a US recession in the second half of this year or early 2024,” said Oanda analyst, Edward Moya.


Potential US default: opportunities for both bulls and bears

Whilst Wall Street has mostly taken US debt-ceiling concerns within stride, the issue could severely hamper the economy if the US government defaults on its debt.

That’s the view from Matt Simpson, a senior market analyst at City Index.

Conversely, Simpson believes an excellent buying opportunity could present itself if or when the debt ceiling is inevitably raised once more.

“And that leaves opportunities for both bulls and bears, depending on how this plays out,” he said.

Traders are also currently keeping a close eye on the US dollar, equities and gold ahead of the debt ceiling decision.

“Any concerns and uncertainties are likely to elevate VIX and spur volatility across the board,” said Zoran Kresovic, Head of Sales (APAC) at Eightcap.

“If we see a default on the debt, this is most likely going to cripple the USD currency and its reputation as a reserve currency of the world.

“A default also means household spending will be largely affected. The US economy could also be in recession and the unemployment rate could potentially skyrocket.

“If this does happen, then the stock market will likely follow suit, and other asset classes too, providing investors who like to trade volatility with an opportunity to take advantage of the moves,” added Kresovic.



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Code Name Price % Change Volume Market Cap
IVC InvoCare Limited 12.44 12.17 1,499,484 $1,597,633,529
EVN Evolution Mining Ltd 3.93 3.84 7,092,933 $6,936,361,686
DEG De Grey Mining 1.49 3.65 1,415,241 $2,248,080,358
RRL Regis Resources 2.15 3.62 2,057,981 $1,562,903,665
RMS Ramelius Resources 1.38 3.56 2,634,445 $1,165,786,976
SYA Sayona Mining Ltd 0.22 3.49 30,513,217 $1,956,231,924
BGL Bellevue Gold Ltd 1.35 3.46 3,426,847 $1,469,051,648
NST Northern Star 13.99 2.98 1,397,825 $15,619,779,337
DBI Dalrymple Bay 2.63 2.94 366,089 $1,264,192,251
GOR Gold Road Res Ltd 1.93 2.79 2,359,802 $2,027,432,215
PRU Perseus Mining Ltd 2.11 2.43 2,799,421 $2,818,052,911
CHC Charter Hall Group 11.54 2.31 1,080,936 $5,335,408,405
BSL BlueScope Steel Ltd 19.40 2.29 1,841,583 $8,738,206,192
CMM Capricorn Metals 4.32 2.25 450,814 $1,586,543,499
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In stock news, making the headlines today was Newcrest (ASX:NCM), which rose 1.5% after accepting the takeover offer from Newmont worth about $28.8 billion.

The combined group will become the world’s biggest gold producer with assets in places like North and South America, Africa, Australia and Papua New Guinea.

Invocare (ASX:IVC) surged 12%, also on takeover news.

The company said its suitor, private equity firm TPG Capital, has come back with $13 per share offer (up from $12.35 in March), valuing IVC at $1.9bn. Invocare’s board said it was willing to accept the $13 offer in the absence of a higher bid.

Gaming machine manufacturer Aristocrat Leisure (ASX:ALL) rose 1% after announcing that it has agreed to acquire NeoGames for $1.8 billion.

Aristocrat also announced that its on-market share buy-back program has increased by up to $500 million.



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Code Name Price % Change Volume Market Cap
ELD Elders Limited 7.23 -12.95 6,907,036.00 $1,298,755,564
NAN Nanosonics Limited 5.15 -8.13 1,651,531.00 $1,692,937,691
WAM WAM Capital Limited 1.64 -5.76 1,860,356.00 $1,898,253,409
ANZ ANZ Group Holdings 23.59 -3.71 7,415,285.00 $73,582,486,159
APE Eagers Automotive 14.11 -3.29 457,851.00 $3,726,258,264
SQ2 Block 83.67 -2.90 189,954.00 $2,580,305,760
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Listed investment company WAM Capital (ASX:WAM) fell 1.5% despite reporting an increase in its portfolio value during the month of April.

The company said significant contributors for the gains were data centre provider NextDC, and asset manager HMC Capital.

Agribusiness company Elders (ASX:ELD) meanwhile tumbled 13% after reporting a 45% decline in NPAT for the first half. The company also declared a 30 per cent franked dividend of 23c a share, down from 28c a year ago.