Closing Bell: Small caps are boss in land of the Southern Cross
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The Emerging Companies (XEC) index is well over 2% higher on Monday, while the ASX200 (XJO) has also ended the session up a very healthy 1.4% ahead.
The wee digger, Southern Cross Gold (ASX:SXG) has jumped on a ‘spectacular’ gold and antimony hit in Victoria, while around the Asia-Pacific equity markets opened with relative confidence as China’s icy take on Covid-19 began to show signs of a thaw.
Around the Asia-Pacific equity markets opened with relative confidence as China’s icy take on Covid-19 began to show signs of a thaw and the Friday lead out of Wall Street lasted well into the weekend after celebrating its punchiest fighting week since almost Christmas 2020.
Local small caps surged with rare earth diggers and local goldies showing the way with what Reuben calls some rampaging performances.
Japanese and Hong Kong equities led gains, while S&P 500 and Nasdaq 100 contracts climbed in a sign the bounce may have further to run. The S&P 500 wiped out its May losses and snapped a string of seven weekly declines as institutional investors rebalanced portfolios into the end of the month.
(Stocks highlighted in yellow rose after making announcements during the trading day).
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The explorer Southern Cross Gold (ASX:SXG) has lit up the ASX like a bunch of meaningful stars in the desert sky. The stock price has gone ionospheric as well, up at 150% when I first checked it at lunchtime.
SXG has made what the strange creatures in our West Coast newsroom also call a spectacular hit. They point to SXG pointing to this: 119m at 3.9g/t gold equivalent from 106m depth at the ‘Sunday Creek’ project in Victoria. They reckon it’s gold (and some other stuff, but mainly gold).
Reuben says the true thickness – the width of the vein/orebody/shoot at its narrowest point – is estimated at an impressive 71m – 83m.
This hit in hole SDDSC033 included a bunch of higher-grade zones like:
The stock did well last week, reporting some high-grade and fatty fat-fat zones of gold and antimony mineralisation in assays returned from the ol’ Sunday Creek. Antimony Reuben tells me, is alloyed with lead and tin for use in products like bullets, batteries, and semiconductors.
But this latest result — drilled to test a 120m gap between three mineralised shoots — is and here we’re quoting the company: “unprecedented”.
SXG managing director Michael Hudson is understandably pleased, as this sort of yawning width of high-grade mineralisation is rarely – if ever – seen in the Victorian goldfields.
He says the 119m at 3.9g/t gold strike puts SXG in a “new realm” and is another cracking win in “a remarkably successful drill program,”
“Continuity, with great width and grades, is now evident down to 335m vertical depth in the Apollo Shoot that remains open to depth, while multiple adjacent shoots remain to be drilled out.
“With the freehold land secured, industry-leading drill results, strong local relationships, a team of ore discoverers in place and the drill rig continuing to target extensions to mineralisation found in SDDSC033, we highly anticipate further results,” Hudson added.
Bubs Australia (ASX:BUB) has had a pretty good day – up over 60% this morning, after the US President Joe Biden tweeted what legends they all were for prepping to send some that 1.25 million tins – or the equivalent of 27.5 million bottles – of infant formula to teet starved Americans, where formula has become more precious than babies.
By association A2Milk (ASX:A2M) jumped 10.3%. And if they’re doing well by proxy, then you can be sure the FDA is stamping licenses and taking numbers.
(Stocks highlighted in yellow fell after making announcements during the trading day).
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Well I guess that’d be the minority shareholders of Yancoal’s (ASX:YAL).
Josh Chiat reports the minor punters at Australia’s third most prolific coal miner have used this morning’s AGM to start a fire about last week’s proposal that could see its Chinese parent take out the $8 billion coal miner at a shocking 16.6% discount to its last traded price.
Yancoal shares were paying $6.08 on Wednesday before entering a trading halt as controlling shareholder Hong Kong-listed Yankuang Energy Group announced plans for a lowball US$3.60 ($5.07) a share bid for the ~38% of the miner it didn’t already own.
Yancoal shares are down almost 15% on the open before pulling back to a ~7% drop at around lunchtime.
There was some pretty big news across the small cap sector today, and with everyone going goo-goo ga-ga over baby formula – the most socially-acceptable source of powdered happiness – quite a few other bibs and bobs flew under the radar.
Among those is Chemx (ASX:CMX) which announced that it’s lodged a Prospectus for Loyalty Options. Shareholders (who we assume have sworn fealty and undying allegiance to the Board, or something) can snap up options at $0.005 each, at a 1 to 4 ratio per share owned on the record date of Friday, 3 June 2022, with an exercise price of $0.30, and a 3-year expiry date.
In a bit of a body blow for people who prefer hurtling through the air to spending hours on a coach with no dunny, Regional Express (ASX:REX) has said “get rekt” to five of its regional air routes. From June 30 the airline will cease operations to Bathurst, Grafton, Lismore, and Kangaroo Island (with Ballina grounded from July 3), and is laying the blame for its decision on the conclusion of the Federal government’s Regional Airline Network Support (RANS) program.
In the west, Enterprise Metals (ASX:ENT) has had a few people scratching about in the dirt at its Bullfinch North project, and they’ve brought back soil samples and rock chips for the lab rats to peruse. Enterprise is reporting results from this endeavour are looking pretty good, ranging from 25.2ppm to 39.2ppm of lithium from the top 30 sample sites – which means it’s probably time to wheel in the drills to take a closer look at the more promising spots.
MEC Resources (ASX:MMR) has announced it’s teaming up with BPH Energy to sink some money into a hydrogen technology company. The companies are looking to get into bed with CleanHydrogen Technologies Corporation, which has figured out a successful (at proof-of-concept scale) way of producing hydrogen at a 92% cracking efficiency – with a nice round zero on the CO2 side of the ledger. The deal needs to pass muster with the BPH Energy crowd, who are meeting on June 21 to mull it over.
And last for today, local sports prediction app maker Sportshero (ASX:SHO) has inked a deal with China’s second-largest (and CCP-funded) Wuhan Monster Technology, the commercial and operating arm of the Wuhan Esports Association. The agreement paves the way for Sportshero to enter ands operate within the unreasonably massive WeChat social ecosystem, with all revenue from the venture to be split down the middle.
9 Spokes International (ASX: 9SP) – suspension from Official Quotation at the request of 9SP, pending the submission of its annual report
Australian Rare Earths (ASX: AR3) – capital raising
Metrics Master Income Trust (ASX: MXT) – capital raising
OzAurum Resources (ASX:OZM) – capital raising
Navarre Minerals (ASX:NML) – capital raising