Closing Bell: Humm is rattled as small caps and tech lead losses
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Small Caps are sharply lower and the ASX 200 is wandering aimlessly on Wednesday as tech names tumble and a directorless Humm help keep anxious traders on the sidelines.
The Americans got into it overnight after yet another long weekend – US stocks jumping like the bounce of a still living feline – Wall Street closing near session highs after its worst week since October 2020.
The bounce of the living feline comes ahead of Fed Reserve Chairman J Powell’s semi-annual appearance on The Hill to talk his way out of WTH happened on inflation later tonight Sydenham time, while the Uni of Michigan consumer sentiment figures still a way aways on Friday are already pulling some focus and, should they go south, may well trigger a whole new set of emotional spasming across stateside and therefore local markets.
The IT sector has had a simply crap day, ignoring the Nasdaq’s overnight 2.5% gain.
After US energy names surged some 5% overnight – cashing in after last week’s broad-based US$2 trillion rout on the S&P 500 – the local energy sector was our stand out performer until crude prices began to diminish after lunch. Near the close, West Texas is now short about 5% dipping to a six week low as anxieties re-constellate ahead of J Powell’s appearance at about midnight our time.
In a note today, AMP senior economist Diana Mousina warns that the risk of an economic downturn have clearly increased sometime in the next 12-18 months.
“This means that the next few months could see more downside in sharemarkets, until inflation moderates and the growth outlook stabilises.
“We remain more optimistic on Australian shares versus US or Europe because of the higher exposure to commodities in our sharemarket (which remain in an uptrend) and less tech shares (which tend to perform worse as interest rates/bond yields rise),” she added.
(Stocks highlighted in yellow rose after making announcements during the trading day).
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Not much of a tweeter, I find myself rooting for the diggers that do:
Finding innovative ways to locate and develop mineral deposits in Western Australia and beyond is our passion!💪 🔥
— Tempest Minerals Limited (@tempestminerals) June 22, 2022
This is clearly a terrific tweet with its author Tempest Minerals (ASX:TEM) rising by about fitty percent today.
Reuben notes that in March TEM spiked hard on a potentially very large copper discovery.
The first 709m-long hole of a two-hole diamond drilling program at ‘Orion’, part of the flagship ‘Meleya’ project in WA, pulled up three mineralised copper sections. The second, 1,021m-long hole hit more of the same.
Meleya is part of TEM’s 900sqkm ‘Yalgoo’ tenements, where the company has + 50km strike length of a previously unexplored segment of a mineral-rich greenstone belt.
Assays are still pending.
(Stocks highlighted in yellow fell after making announcements during the trading day).
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Incredibly, Zip Co (ASX:Z1P) and it’s previously buoyant share price have just about got their feet back on solid ground – the BNPL darling has shed about 92% on its share price, when at this time last year shares in Z1P were going for well over eight dollarbucks.
Today Zip Co is down a further 7% and headed toward what would be a more than six year low.
The disintegration comes as doubts and crack appear in the company’s vaunted UK expansion, while the model is also failing to meet its lofty promises over in the states.
But it’s not always the number losses which hurt the most. Today, the suddenly flailing fintech Humm lost the cream of its Board who were not to outlive the death of their much touted takeover deal with Latitude Financial.
“The events leading to the termination of the proposed sale of Humm consumer finance (HCF) to Latitude have caused the majority directors of Humm Group to conclude that they cannot remain on the board of directors with Andrew Abercrombie.”
Majority directors Wylie and Muir have already fallen on their knives, while chairman Christine Christian says she’ll go when a fitting replacement is found.
No board now, we’ll find one later.
Kicking off with a big-time two-banger is Lithium Power International (ASX:LPI), which has entered into definitive binding agreements to consolidate 100% ownership of the Maricunga Lithium Brine project in Chile via two all scrip mergers with JV partners Minera Salar Blanco SpA and Bearing Lithium Corp. (BRZ:TSXV).
As it stands, LPI currently owns a 51.55% interest in Maricunga, with JV Partners MSB SpA holding 31.31% and Bearing holding 17.14%. The deal structure is a little on the convoluted side, but the good news for shareholders is that they will increase their proportionate interest in Maricunga from 51.55% to ~57.9%.
Meanwhile, Iceni Gold Limited (ASX:ICL) says it’s received the assay results from the 127-hole AC drilling program at TOTK totaling 3,488m surrounding its initial DD program. The results include 2m @ 0.18g/t Au from 20-22m, 2m @ 0.11g/t Au from 28-30m and 2m @ 0.10g/t Au from 4-6m.
ICL says the full DD results are pending, so you’ll just have to wait to find out whodunnit.
And a super-quick lightning round because today’s getting a little long in the tooth: Azure Minerals (ASX:AZS) wants to avoid any “new phone… who dis?” moments by informing us their new number is +61 8 6187 7500, Renegade Exploration (ASX:RNX) quite shockingly says Lady Agnes has been drilled, and – because it can’t all be fantastic news for humanity – we felt we should probably tell you that the New South Wales government says it’s fine for Crown Resorts Limited (ASX:CWN) to start emptying everyone’s pockets in Sydney. Super.
Livehire Limited (ASX:LVH) – Material master services agreement announcement.
ArchTIS Limited (ASX:AR9) – Announcement regarding a material customer contract.
Hartshead Resources NL (ASX:HHR) – Announcement in relation to the Phase I development of the Anning and Sommerville gas fields.
Horizon Minerals Limited (ASX:HRZ) – Capital raising.
Orbital Corporation Limited (ASX:OEC) – reimbursement request against Insitu Inc., associated with Insitu’s termination of the third engine development program under its long term supply agreement.
PainChek Ltd (ASX:PCK) – Non-renounceable entitlement offer and placement announcement.