ASX Small Cap Lunch Wrap: Where do markets go from here?

Investors had a great June quarter as economies reopened and stimulus cash flooded markets.

The US Dow Jones (+17.8 per cent), S&P500 (+20 per cent) and Nasdaq (+30.6 per cent) indexes posted their biggest quarterly gains since 1987, 1998, and 1999, respectively.

The German Dax lifted 23.9 per cent. Japan’s Nikkei rose 17.8 per cent and the UK FTSE increased 8.8 per cent, according to Commsec.

The benchmark ASX200 index was up 16.2 per cent, its biggest gain since the September quarter of 2009.

Over the entire financial year the ASX200 fell by 10.9 per cent — its worst performance since 2011-12 — despite hitting record highs of 7,162.5 points on February 20.

This wild ride is far from over

But circumspect commentary from US Federal Reserve Chairman Jerome Powell and fears about growing US COVID-19 infections reduced risk appetite in late June.

The world’s largest asset manager BlackRock has downgraded US equities to ‘neutral,’ on fading fiscal stimulus, a longer than expected epidemic, and renewed US-China trade tensions.

Aussie financial commentator Peter Switzer doesn’t think a huge share market sell off is likely — but it could happen if a second wave of infections goes crazy.

“If it did, I’d be a buyer of the stocks that surged after the last stock dumping and now, like I did then, I’d be expecting to make money in a year or even two, because I’m a long-term investor, who buys good quality companies when short-term traders get scared and panic sell,” he says.

“That has been the story I’ve sold to you for years and I’m not changing it now.”

WINNERS

Here are the best performing ASX small cap stocks at 12pm Wednesday July 1:

Swipe or scroll to reveal the full table. Click headings to sort.

CODE	COMPANY	PRICE	% CHANGE	MARKET CAP
ATH	Alterity Therapeutics	0.32	1782.35%	$332.0M
CY5	Cygnus Gold	0.16	125.35%	$4.9M
ESK	Etherstack	2.7	54.29%	$306.4M
UUV	UUV Aquabotix	0.0015	50.00%	$792K
XPE	XPED	0.0015	50.00%	$2.7M
CLZ	Classic Minerals	0.002	50.00%	$9.4M
OAR	Oakdale Resources	0.003	50.00%	$1.4M
RVS	Revasum	0.6	48.15%	$19.3M
ISD	Isentia Group	0.21	44.83%	$40.0M
TSL	Titanium Sands	0.066	34.69%	$76.6M
GID	GI Dynamics	0.004	33.33%	$3.7M
KEY	Key Petroleum	0.004	33.33%	$7.9M
RDN	Raiden Resources	0.008	33.33%	$3.5M
CWL	Chant West Holdings	0.105	31.25%	$13.3M
OKR	Okapi Resources	0.18	28.57%	$5.1M
CCZ	Castillo Copper	0.034	30.77%	$26.6M
HIP	Hipo Resources	0.019	26.67%	$7.7M
CXZ	Connexion Media	0.019	26.67%	$16.4M
CAU	Cronos Aus	0.086	26.47%	$10.9M

Yesterday, dual-listed stock Alterity Therapeutics (ASX:ATH) told local shareholders it had received “guidance” from the US FDA about the development pathway for its anti-Multiple System Atrophy (MSA) drug.

That didn’t get much of a response from the Aussie market — until its US shares spiked 103 per cent overnight.

Alterity subsequently gained an eye-popping +1,780 per cent (and counting) in morning trade before entering a trading pause.

WA-based explorer Cygnus Gold (ASX:CY5) gained +125 per cent after announcing ‘the man with the golden touch’ Ray Shorrocks would join the board as non-executive director.

Shorrocks was instrumental in the success of ASX300 gold company Bellevue Gold (ASX:BGL) as former chairman, and is current chairman of market darling Auteco Minerals (ASX:AUT).

And after climbing over 1,000 per cent yesterday, Etherstack (ASX:ESK) climbed by another 54 per cent in morning trade.

In case you missed the news yesterday, it signed a deal with global behemoth Samsung Electronics.

LOSERS

Here are the worst performing ASX small cap stocks at 12pm Wednesday July 1:

Swipe or scroll to reveal the full table. Click headings to sort.

CODE	COMPANY	PRICE	% CHANGE	MARKET CAP
VPR	Volt Power Group	0.001	-50.00%	$9.2M
APG	Austpac Resources	0.001	-33.33%	$4.3M
LIT	Lithium Australia	0.005	-28.57%	$27.2M
HPR	High Peak Royalties	0.054	-22.86%	$10.2M
ELT	Elementos	0.004	-20.00%	$10.9M
LBT	LBT Innovations	0.19	-17.39%	$44.8M
VRC	Volt Resources	0.02	-16.67%	$38.0M
PSZ	PS&C	0.027	-15.63%	$14.0M
DRE	Dreadnought Resources	0.006	-14.29%	$11.3M
KAM	K2 Asset Management	0.044	-13.73%	$10.6M
FXL	Flexiroam	0.013	-13.33%	$461.4M
KAS	Kasbah Resources	0.007	-12.50%	$947K
CAY	Canyon Resources	0.15	-11.76%	$74.9M
DLC	Delecta	0.008	-11.11%	$5.8M
GIB	GIBB River Diamonds	0.036	-10.00%	$6.5M
APH	Australian Primary Hemp	0.1	-9.09%	$7.0M
EMT	Emetals	0.011	-8.33%	$4.5M
KME	Kip McGrath Education Centres	0.94	-8.29%	$48.7M