Closing Bell: China’s COVID-0 recipe sour small caps, little index down circa 5pc in 2 sessions

• ASX200 crashes almost 2% on Tuesday, but can’t even get that right
• ASX Emerging Companies index over 3% lower
• Elon’s US futures up more than 1% ahead of open

Following a really terrific Friday selloff, the ASX200 has been given a good spanking on its Tuesday return to business and at 3.59pm in Sydney is currently sitting in the corner with a funny hat, down 1.9%.

For its part, the ASX Emerging Companies index (XEC), has followed its previous session loss (of just 1.5%) with a more definitive 3.25% retreat.

Weakness in commodities like zinc, iron ore and base metals led the resource reliant Australian markets lower. Iron ore, without China making stuff is worth practically nothing at US$149. Oils down under $US100 too.

Global interest rates and the conflict in Ukraine remain front of mind for global investors as markets from Asia to Europe face gathering headwinds, but here at home a pall hangs large over the region with China’s totalitarian approach to COVID-19 and it’s likely spread to Beijing – hitting Chinese supply chains, factories, families and undermining what little confidence was being felt for the world’s second-largest economy.

This morning Twitter tweeted its about-turn on Elon Musk’s $US45bn plan for the future of tweeting. With Musk looking keen to take his new toy for a Tuesday spin and US earnings season in full swing, the session on Wall Street is looking decidedly exciting – the S&P500 futures ahead by around 1% in late-arvo Asian trade.

Shanghai is down circa 2%, so is Shenzhen. In Honkers, the Hang Seng is in positive territory and so is the Nikkei, up over 1% in Tokyo.

Now to the good news

Listing today, Lithium Plus Minerals (ASX:LPM) has closed about 180% higher.

IPOing with about $10m in the kitty, raised at $0.25 the lithium play has a cornerstone investment from Suzhou CATH Energy Technologies, a subsidiary of CATL, the world’s largest EV battery manufacturer.

Stockhead’s Emma Davies is all over this one. it’s fascinating.

TODAY’S BIGGEST SMALL CAP WINNERS

(Stocks highlighted in yellow rose after making announcements during the trading day).

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“It’s now well and truly game on at Abercromby,” according to managing director Bruce McCracken, BMG Resources (ASX:BMG).

The WA explorer just hit thick, high-grade gold at ‘Capital’ — part of the ‘Abercromby’ project — including a highlight 31m at 6.18g/t gold.

This was part of a broader 77m intersection grading ~3g/t from 116m. Results from early stage ‘aircore’ drilling, testing new areas to the south of Capital, are expected shortly. Follow-up drilling to find the edges of the Capital deposit could kick off next month.

“In one single program, we have more than doubled the likely size of the deposit, intersected extremely high-grade gold in fresh rock, and proven the system is fertile at depth via the deepest drilling undertaken at the Project to date,” McCracken says.

“The nature and style of mineralisation is becoming well recognised, and the company is in a great position to leverage further success with the drill bit from here,” McCracken added for full measure.

Vanadium Resources (ASX:VR8) joins a growing list of ASX-listed vanadium companies that have been dual listed on the Frankfurt Stock Exchange (DAX), such as Neometals (ASX:NMT), Australian Vanadium (ASX:AVL) and TNG (ASX:TNG).

The listing will broaden VR8’s exposure to European investor cash as it develops the Steelpoortdrift vanadium project in Limpopo, South Africa. The $80m market cap stock is up 150% year-to-date. It had $4.8m in the bank at the end of December.

“With increasing awareness of vanadium’s demand, both as a strategic metal and its use in the storage of renewable energy, we are pleased to have listed on the Frankfurt Stock Exchange, to provide the Company exposure to the European Investment community,” VR8 exec director Jurie Wessels says.

TODAY’S BIGGEST SMALL CAP LOSERS

(Stocks highlighted in yellow fell after making announcements during the trading day).

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ANNOUNCEMENTS YOU MAY HAVE MISSED

Covid-19 Rapid antigen test supplier Atomo Diagnostics Limited (ASX:AT1) has announced expansion of its executive commercial team and a change in the COO role to better support renewed international commercial focus and operations activity.

Based in San Diego, California, Jim McMenamy is the Head of Business Development and Partnerships, the Americas, while based in the UK, Anna Tucker is Head of Business Development and Partnerships, Europe, Middle East and Africa (EMEA).

Based in Sydney, Chandra Sukumar assumes the role of COO, building on her experience running product development and OEM product management with the company. UK based Mark Smith is departing as Atomo’s COO and will consult during a transition period.

American Rare Earths (ASX:ARR) has announced it is exploring a potentially massive rare earths minerals deposit in Albany County, Wyoming.

The company staked 181 mining claims covering an area of 1191ha after positive results from 118 surface samples led the company to increase its target area.

The growth brings American Rare Earths’ Halleck Creek project to 2449ha. The company has additional projects in Arizona and Nevada. Halleck Creek drilling results are due in June 2022.

Meanwhile, Marquee Resources (ASX:MQR) has announced results from auger sampling at the Redlings Rare Earth Element Project in Western Australia have identified significant and widespread zones or rare earth element anomalism.

Results included surficial values of 2,928 pppm TREO associated with previously unrecognised REE-bearing dykes.

The company said results highlight potential to identify additional REE-bearing dykes throughout the project area.