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Closing Bell: Between rocks and a hard place (to get COVID), small caps crash and stimmy hopes dash on China lockdowns
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- XEC falls hard on Monday
- XOJ closes 1.2% lower
- Seafarms Group (ASX:SFG) recovers Friday losses
Australian markets fell and fell hard on Monday. The benchmark ASX200 is nudging two month lows, while the Greenback’s near 20-year high has left the wee Australian dollarbuck retreating to under US70¢ for the first time since January. China – and fears for China’s economy – are playing out across regional markets. The Hang Seng is down 3.8%.
Reports that Shanghai has tightened COVID-19 restrictions pressured the local currency, while iron ore futures also slumped.tech and hit by tech firms Block and Xero as US stocks closed lower and iron ore fell.
Chinese trade data for April was a beat on expectations – imports didn’t fall more than 3% as economists feared – no, that was actually the ASX Emerging Companies index (XEC), down 3.5%, with key commodities under a cloud now the reality of China’s hard lockdowns is tearing a hole in the hopes and dreams of an arse-saving stimulation package out of Beijing.
OANDA’s Jeffrey Halley, senior market analyst, Asia Pacific says Asian equity markets are certainly off to a bad start.
“Although the US Dollar has been steadily rising versus Asian currencies, and the risk-sentiment barometers, the Australian and New Zealand Dollars are having a tough day at the office.
“There is no one theme that is causing Asian equities to crate, but if I had to pick one, it would be that concerns over the depth of the China slowdown are accelerating, with virus restrictions tightening in Beijing and apparently, Shanghai once again,” Halley says.
Chinese port activity fell below levels seen during the first hint of COVID back in 2020. Manufacturing activity slid to its worst level since February 2020 and exports are spluttering at their weakest pace since June 2020. Supply chain bottlenecks are looking unlikely to unwind with the mere flick of an official wand either.
TODAY’S BIGGEST SMALL CAP WINNERS
(Stocks highlighted in yellow rose after making announcements during the trading day).
Scroll or swipe to reveal table. Click headings to sort.
| Code | Company | Last | % | Volume |
|---|---|---|---|---|
| YPB | YPB Group Ltd | 0.0015 | 50% | 5,371,879 |
| PTX | Prescient Ltd | 0.1650 | 32% | 11,229,531 |
| LNY | Laneway Res Ltd | 0.0050 | 25% | 850,000 |
| NZS | New Zealand Coastal | 0.0050 | 25% | 100,000 |
| SFG | Seafarms Group Ltd | 0.0170 | 21% | 5,370,312 |
| ODM | Odin Metals Limited | 0.0200 | 18% | 325,435 |
| XST | Xstate Resources | 0.0035 | 17% | 6,425,220 |
| MDI | Middle Island Res | 0.1500 | 15% | 2,946,560 |
| EMU | EMU NL | 0.0150 | 15% | 1,258,608 |
| BRN | Brainchip Ltd | 1.2200 | 15% | 37,976,726 |
| DCX | Discovex Res Ltd | 0.0080 | 14% | 25,505,427 |
| MEB | Medibio Limited | 0.0040 | 14% | 250,247 |
| POW | Protean Energy Ltd | 0.0080 | 14% | 2,595,815 |
| SHE | Stonehorse Energy Lt | 0.0170 | 13% | 2,520,653 |
| EAX | Energy Action Ltd | 0.1800 | 13% | 20,000 |
| AJQ | Armour Energy Ltd | 0.0090 | 13% | 1,308,894 |
| CFO | Cfoam Limited | 0.0090 | 13% | 444,444 |
| AYT | Austin Metals Ltd | 0.0190 | 12% | 9,424,821 |
| RRR | Revolverresources | 0.3500 | 11% | 114,916 |
| CNB | Carnaby Resource Ltd | 1.2400 | 10% | 2,048,129 |
| PNX | PNX Metals Limited | 0.0055 | 10% | 1,900,000 |
| TMX | Terrain Minerals | 0.0110 | 10% | 3,819,192 |
| 1VG | Victory Goldfields | 0.1700 | 10% | 31,250 |
| ABE | Ausbondexchange | 0.4100 | 9% | 200 |
| HVM | Happy Valley | 0.0600 | 9% | 81,333 |
Prescient Therapeutics (ASX:PTX) is well ahead after the clinical stage oncology company announced its Phase 1b clinical trial of PTX-200 and cytarabine in patients with relapsed acute myeloid leukemia (AML) will expand the cohort at 45 mg/m² PTX-200 following another complete remission and no dose limiting toxicities at this dose level.
Three patients were treated at 45 mg/m² PTX-200 together with cytarabine, with no dose limiting toxicities reported. One patient achieved a CRi, meaning complete remission of the disease. CR (complete remission). The latest patient brings the total of complete remissions on this study to four patients.
The Discovex Resources (ASX:DCX) and Carnaby Resources (ASX:CNB) Greater Duchess’ JV announced a “stunning drill result” of 68m at 2.4% copper and 0.4g/t gold from 40m.
CNB says wide, high grade and very shallow copper gold mineralisation now been intersected over a core zone of over 300m strike length which remains strongly open.
“These stunning drill results clearly demonstrate the resource and development potential of the Greater Duchess Copper Gold Project,” CNB MD Rob Watkins said.
“We are discovering and building a pipeline of exceptional and highly desirable copper gold deposits whose intrinsic value will only grow over time as we define and grow the maiden resource and move towards a development timetable.”
EMU (ASX:EMU) is up very nicely on no news this one can see. The WA explorer has four main projects: ‘Badja’ (gold, tungsten), ‘Graceland’ (nickel, copper, PGEs), Viper (nickel, copper), and ‘Sunfire’ (nickel, copper).
In early April the company noted “the possibility of further and imminent discoveries” at Badja’s ‘Monte Cristo’ gold-tungsten target, where assay results from 24 drillholes are due any day now.
Reuben says, 2,500m and 500m drilling campaigns are due to kick off on some nickel sulphide targets at ‘Graceland’ and ‘Viper’ respectively, with timing “depending on rig availability”.
The ~$12m market cap stock is down 20% year-to-date. It had $1.6m in the bank at the end of March.
Seafarms Group (ASX:SFG) have rallied hard shares are up well over 20%, recouping some of Friday’s bleeding as the battle for its future intensifies now that the SeaDragon aquaculture project is under a mighty cloud.
SFG has a market cap of around $74 million.
Todd River Resources (ASX:TRT) is also trading sharply higher on new news. TRT has a handful of projects, the most interesting for Reubs right now being its copper-nickel-PGE ground near Chalice Mining’s (ASX:CHN) Julimar called ‘Berkshire Valley’.
Early drill results have been mixed so far, but TRT reckons there is something big lurking. A bunch of drilling results are expected within the next month.
TRT is talent packed. Managing director Will Dix was part of the team that discovered the ‘Waterloo’ nickel mine and the 2Moz ‘Thunderbox’ gold project, which is probably where he met non exec director Mark Bennett, best known for his leadership of small cap success story Sirius Resources.
Also on the board is Stu Crow, non-exec chairman at white hot lithium stock Lake Resources (ASX:LKE).
The $28.5m market cap stock is down 33% in 2022. It had $5.5m in the bank at the end of March.
TODAY’S BIGGEST SMALL CAP LOSERS
(Stocks highlighted in yellow fell after making announcements during the trading day).
Scroll or swipe to reveal table. Click headings to sort.
| Code | Company | Price | % | Volume |
|---|---|---|---|---|
| IPTRA | Impact Minerals - Rights 13-May-22 | 0.001 | -50% | 13,266,739 |
| BOC | Bougainville Copper | 0.48 | -24% | 192,851 |
| GFN | Gefen Int | 0.19 | -24% | 73,800 |
| HIO | Hawsons Iron Ltd | 0.505 | -22% | 16,105,863 |
| EQS | Equitystorygroupltd | 0.11 | -21% | 133,162 |
| OAU | Ora Gold Limited | 0.011 | -21% | 1,751,433 |
| TKM | Trek Metals Ltd | 0.072 | -21% | 1,579,597 |
| DMM | Dmcmininglimited | 0.14 | -20% | 21,656 |
| GME | GME Resources Ltd | 0.1 | -20% | 214,258 |
| IVZ | Invictus Energy Ltd | 0.22 | -20% | 13,267,252 |
| AOA | Ausmon Resorces | 0.008 | -20% | 14,649,866 |
| CWX | Carawine Resources | 0.17 | -19% | 179,155 |
| AVE | Avecho Biotech Ltd | 0.018 | -18% | 5,224,454 |
| CST | Castile Resources | 0.185 | -18% | 544,700 |
| PNN | PepinNini Minerals | 0.555 | -18% | 1,623,877 |
| LEL | Lithenergy | 1.33 | -17% | 976,170 |
| SRK | Strike Resources | 0.175 | -17% | 2,089,268 |
| AQX | Alice Queen Ltd | 0.005 | -17% | 5,524,922 |
| CLE | Cyclone Metals | 0.005 | -17% | 49,060,778 |
| CT1 | Constellation Tech | 0.005 | -17% | 3,750,766 |
| LCT | Living Cell Tech. | 0.005 | -17% | 356,986 |
| PCL | Pancontinental Energ | 0.01 | -17% | 14,415,191 |
| XTC | Xantippe Res Ltd | 0.01 | -17% | 62,062,308 |
| CRR | Critical Resources | 0.076 | -16% | 30,689,779 |
| KWR | Kingwest Resources | 0.13 | -16% | 1,058,092 |
ANNOUNCEMENTS YOU MAY HAVE MISSED
Aurelia Metals (ASX:AMI) has got regulatory approval to extend the life of its Peak Gold and base metals project up until 2035 following the NSW’s government’s issue of development consent for the New Cobar Complex.
The New Cobar Complex is a State Significant Development (SSD) that almagates the existing approved underground mining of the Chesney and Jubilee deposits, and development of new underground workings at the Great Cobar and Gladstone deposits.
Resource Mining Corporation (ASX:RMI) has announced its conditionally agreed to acquire 100% of the issued capital of Massive Nickel Ltd which indirectly holds a portfolio of Tanzanian nickel exploration assets.
Massive Nickel holds a 100% interest in prospecting licences that are granted or in application that comprise the Kabanga North Nickel Project, Kapalagula Nickel (copper+PGE’s) Project and the Mbinga Nickel, Liparamba Nickel and Kitai Nickel Projects.
TRADING HALTS
Broo Limited (ASX:BEE) – trading halt, pending a market update in relation to a company restructure
AUB Group (ASX: AUB) – trading halt, pending an announcement regarding the outcome of the institutional component of the accelerated entitlement offer
Wellfully (ASX: WFL) – trading halt, pending an announcement with regards to a capital raise
Galileo Mining Ltd (ASX:GAL ) – trading halt, in relation to material assay results from recent drilling at the company’s Norseman Project
