ASX Small Cap Lunch Wrap: Who’s asking for a miracle today?

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By close of business yesterday, things were getting pretty ugly on the local market. The ASX200 slumped sharply again to cap a three-day fall of almost seven per cent, with sharper falls on the Small Ords Index.

And it didn’t look much better in the US overnight, as the S&P500 initially fell more than two per cent on second-wave COVID-19 fears…before closing 0.83 per cent higher.

The catalyst for that significant turnaround was an afternoon announcement from the US central bank. Along with its treasury purchase program, the Fed said it will now start buying up a broad portfolio of US corporate debt “to support market liquidity and the availability of credit for large employers”.

To paraphrase Hans Gruber: “you asked for miracles, Theo? I give you the F.B.I US Federal Reserve”.

Also, did we mention we love this gif? (One more time for those in the back — we love this gif):

Anyway, the old adage “don’t bet against the Fed” rang true at the opening bell this morning, with local stocks rising strongly across the board.

At the big end of town, the ASX200 was up by around three per cent into midday trade, while the Small Ords index was almost 3.5 per cent higher.

In line with the broader risk-on sentiment, the Aussie dollar bounced off recent lows to make a push back towards the US70c mark.

WINNERS

Here are the best performing ASX small cap stocks at 12pm Tuesday June 16:

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

Cancer-fighting company Race Oncology (ASX:RAC) rose by more than 50 per cent in morning trade, and in the biotech space that usually means one thing; a positive clinical trial.

The company is developing a treatment for a rare bone cancer called acute myeloid leukemia (AML), and results from its Phase II clinical trial in Israel revealed the drug showed an objective clinical response in 40 per cent of patients — a significant result for a single course of treatment with patients with late-stage cancer.

Today’s rally caps off an eight-fold increase in RAC shares over the last 12 months, from six cents to 49 cents. Nick Sundich has more here.

And in what could be viewed a positive leading indicator on domestic consumption, consumer-finance platform Wisr (ASX:WZR) rose strongly after announcing monthly loan growth of $13.8m in May. After navigating a rocky period through the worst of the pandemic, Wisr said lending activity has now returned to “pre-COVID-19 origination levels”.

LOSERS

Here are the worst performing ASX small cap stocks at 12pm Tuesday June 16:

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

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