• The S&P ASX 200 closes down 0.2%, while the S&P XEC fell 0.61
  • Larvotto Resources and OD6 Metals both rises after positive rare earths drilling results
  • VHM appoints Mineral Technologies (Downer) for plant cost estimate on Goschen rare earths project

 

Despite a mini rally in New York overnight, the ASX 200 finished 0.40% lower today after setting a new 20-day high yesterday. The S&P ASX Emerging Companies index (XEC) – a benchmark for Australia’s micro-cap companies –  fell 0.34%.

Utilities and materials were the only two of 11 sectors in the green today, rising 0.66% and 0.08% respectively. Materials led the laggards down 2.15%, followed by consumer staples dropping 1.26% and the IT sector, which fell 0.79%.

It was a different story on Wall Street overnight, where all major indexes – the S&P 500, the Dow Jones, and the Nasdaq – rose by 0.3% each on the back of a solid start to earnings season.

But there was signs the US Federal Reserve may continue its rate tightening regime to tame inflation with US government yields rallying after New York factory activity, known as The Empire State Manufacturing survey, posted its first positive reading in five months.

The rise in treasury yields and expectations of further rate hikes saw upward pressure on the US dollar, with the gold rally pausing.

Bullion was trading up ~0.30% on Tuesday afternoon to US$2000.28/ounce after sliding ~0.5% overnight to US$1995.19/ounce.

But dont fret investors, there are ways to manage stress on bad trading days.

 

FROM THE HEADLINES

The pros and cons of artificial intelligence continues to be debated in the media. In an interview with CBS’s 60 minutes Google and Alphabet CEO Sundar Pichai said he was concerned about AI’s rapid development.

Pichai warned that AI will impact on every company’s product and discussed Google’s AI projects, including the human-like chatbot Bard, which left the interviewer saying he felt “unsettled”.

Pichai said AI will disrupt jobs for knowledge workers such as writers, accountants, architects, and even software engineers.

He said, for example, AI could collaborate with radiologists to prioritise cases and that society needed to prepare for the technological advancement and adapt to the changes it will bring.

And a resurfaced clip of Elon Musk, the tech billionaire CEO of Tesla, Space X and Twitter, has also been doing the rounds where he appears deflated when discussing his deep concerns about AI.

In his 2018 appearance on The Joe Rogan Experience podcast, where Musk famously puffed on a joint, he was asked why he had taken on a “fatalistic” attitude against AI.

“I try to convince people to slow down AI – to regulate the AI,” he said.

“This was futile – I tried for years, nobody listened.”

 

ASX SMALL CAP LEADERS

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On the winner’s list today is Larvotto Resources (ASX:LRV)  which announced it has drilled into super high grade clay rare earths up to 1.26% (12,611ppm) at the Merivale South prospect, part of the Eyre lithium-nickel-REE project in WA.

That 1m intercept was within a larger 12m at 2326ppm TREO.

LRV said the mineralisation may be hosted within ionic clays, making it suitable for simple, cost-effective extraction.

And continuing success for the ASX rare earths players is OD6 Metals (ASX:OD6), which announced positive second phase drilling results of 83 holes at its Splinter Rock project.

Assays included up to 6,605ppm TREO and clay thicknesses of up to 80m with 74 of the 83 holes returning significant grades and thickness.  Results included 69m at 1,483 parts per million (ppm) total rare earth oxides (TREO) from 24m and 66m at 1,516ppm TREO

OD6 said a new 188-hole, 10,000m drill program focused on the Centre and Prop targets is scheduled to begin in the current quarter.

 

ASX SMALL CAP LOSERS

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LAST ORDERS

Advanced are earths player VHM (ASX:VHM) has appointed Mineral Technologies, part of Downer Group (ASX:DOW) to provide a detailed design in relation to Phase 1 of the Goschen Project.

“Appointing Mineral Technologies for detailed design is an important step forward for the Goschen Project as we progress towards development and construction,” VHM MD Graham Howard said.

“It also highlights the Project’s status as one of Australia’s most advanced rare earth and mineral sands projects.

“This agreement is indicative of the level of confidence we have in progressing towards production in 2025.”

Health and Plant Protein Group (ASX:HPP) shareholders could be in for a windfall after the company announced it has sold its wholly owned subsidiary, HPP America Inc, the US based holding company of MacFarms, owner of HPP’s Kapua Orchard and macadamia nut business, to Hawaiian Host.

HPP’s said its board is considering how to return the net proceeds of the transaction to its shareholders, and this information will be shared with shareholders during Q2 CY 2023.

The company said timing will subject to confirmation from the US Internal Revenue Service of the US withholding tax payable by HPP for the transaction.

And clinical stage radiopharmaceutical company Clarity Pharmaceuticals (ASX: CU6) has received ~$6.7 million boost in the form of a Research and Development (R&D) Tax Incentive refund as part of the Australian Federal Government’s R&D Tax Incentive program.

CU6 said the $6.7 million will provide additional funding to progress the development of Clarity’s Targeted Copper Theranostic (TCT) platform of products to advance the field of radiopharmaceuticals.

Executive chairman Dr Alan Taylor said it was a significant increase in the R&D tax rebate compared to the previous year due to the rapid increase in its clinical development activities.

“All three of our product areas, being six products in total when considering diagnostic and therapeutic applications, are advancing quickly with Phase 3 trials expected to begin later this year,” he said.

“Although the radiopharmaceutical market is experiencing significant supply issues, Clarity’s differentiated manufacturing and supply chains have allowed all seven of our trials to continue development unabated, generating important data as we progress towards commercialisation.”

 

TRADING HALTS

TMK Energy (ASX:TMK) – Pending a capital raising announcement.

The Environmental Group (ASX:EGL) – Also pending a capital raising announcement.

Unico Silver (ASX:USL) – Pending a capital raise announcement as well.

Linius Technologies (ASX:LNU) – Pending finalising a capital raising.

Great Southern Mining (ASX:GSN) – Another pending capital raising announcement.

International Graphite (ASX:IG6) – Pending announcement of results from a scoping study for proposed Collie Graphite Battery Anode Material Facility.

Vital Metals (ASX:VML) – Pending release of announcement on strategic review of the Saskatoon Plant.

Echo IQ (ASX:EIQ) – Pending results in relation to the Australian Clinical Study Results.

 

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