• Fed ups interest rates and tanks the market. Again.
  • ASX benchmark falls 0.67%, Materials down 1.13%.
  • Besra Gold bucks the trend to climb over 162% for the week (so far).

 

It’s a great day to be Besra Gold (ASX:BEZ), but a pretty dour day to be just about anyone else. More on that later, though, because I’ve got a sick joke for you.

Stop me if you’ve heard this one… but it’s all Jerome Powell’s fault. Please don’t make me explain why – because it’s for exactly the same reason that it always is.

Rates go up, market goes down, Powell looks briefly uncomfortable, and then explains that we’ll all be okay – we just need to “build another hotel on Mayfair” and things will be back to normal.

The Aussie market opened lower this morning, and worked its little patootie off all day to claw back a measly 0.1%, finishing the session down 0.67% to the accompaniment of much wailing and gnashing of teeth.

There were also early reports of garments being torn, but that turned out to be a browser tab I forgot to close before I fell asleep last night. Lesson learned, and my apologies for getting the HR department all riled up again.

A look at the market sectors shows that Materials was the big loser today, dumping 1.13% with Energy (-0.81%), InfoTech (-0.79%) and Financials (-0..77%) losing out as well.

Consumer Staples tried hard to get it right, managing +0.13% while Telcos stuck its head round the door, figured the party was a bust and bolted, leaving behind a faint whiff of brimstone and a +0.08% shadow.

 

FROM THE HEADLINES

The US Fed’s rate rise was entirely expected, but still quite damaging to the markets overnight, leading many to start wondering what RBA boss Philip Lowe has in store for Australia in a couple of weeks.

BetaShares chief economist David Bassanese has had a deep look into his crystal ball – (I heard there was a gardening accident that he doesn’t like to talk about) – and reckons that we’re going to cop another 25 basis point bop on the nose, but then we might see things settle down after that.

But it depends, Bassanese says, on local data more than it does on what’s happening overseas.

“As for Australia, the Fed’s decision to raise rates – and following the ECB’s similar decision last week – suggests concerns over global financial instability should not be a barrier to the RBA raising rates again in April,” he foretold, ominously.

“Instead, the RBA will base its decision on the run of local economic data – which so far at least has remained on the firm side, especially the 60,000 bounce back in employment during February.

“My base case remains the RBA will raise rates once more in April and then signal a pause. This depends on a still reasonably firm retail sales and monthly CPI report next Tuesday and Wednesday respectively.”

A quick look overseas, and it’s worth mentioning that a handful of “celebrities” have coughed up some hefty fines to settle “without admitting guilt” accusations that they were involved in what was allegedly a transparently clear crypto scam.

The names of the famous folks include celebrity substance abuser Lindsay Lohan, porn actress Kendra Lust, a bunch of names I don’t recognise because I’m not 12 years old, and – joy of joys – lantern-jawed YouTube sensation turned pro boxer, Logan Paul.

Of the eight celebs accused of illegally promoting crypto assets, all but two (Soulja Boy and Austin Mahone) have coughed up fines totalling more than $597,000 – which means that we’re going to have to miss out on the spectacle of seeing boxer Logan Paul get “punched around the ring” in prison.

The whole sorry mess stems from Chinese crypto entrepreneur Justin Sun’s ham-fisted effort to shift his companies’ Tron (TRX) and BitTorrent (BTT) shitcoins, using undeclared paid celebrity endorsements to pump them, while simultaneously wash trading – high-speed “buying and selling” of the assets, without them ever actually changing hands, to artificially jack up the price.

 

LAST ORDERS

It looks like Covid-19 has claimed another business scalp, after Monadelphous Group (ASX:MND) informed the market that it has decided to shutter its Chile-based construction and maintenance services business, Buildtek.

Citing a broader Covid-led downturn in Chilean industry, Monadelphous says that Buildtek has simply become too expensive to keep on the books, after the company poured millions into it over the past 3-and-a-bit years.

Monadelphous had paid about $8 million in 2019 for a 75% stake in Buildtek, parlaying early success into increasing that stake by another 15% between then and now – so it can’t have been an easy call to make.

But it seems like it was a popular call, according to investors, which has seen MND trading 1.8% higher for the day.

Closer to home, Group 6 Metals (ASX:G6M) has provided an update on the $2 million grant the Tassie government grant gave to Hydro Tasmania for the Company’s 100%-owned Dolphin Tungsten  Mine.

The grant was to enable Hydro Tasmania to effect a grid connection and other necessary upgrades and modifications to the existing HV transmission line to Grassy, so there’d be enough juice to get Dolphin chirping like it’d just been thrown a feed of kippers.

Sadly, after some back’n’forth, it’s become abundantly clear that the proposed solution was a non-starter  – so the leftover funds (some $1.64 million) will be put towards implementing a dedicated interim diesel power station on-site at Dolphin, as well as completing a feasibility study into the potential integration of renewable energy to complement the diesel-generated power supply.

And lastly for today, Quantum Graphite (ASX:QGL) has informed the market that something hugely technical has occurred – but the more I read this, the more all the words are jumbling together and I think I need to have a lie down.

But, seeing as how I am 100% a comsunms consomme total professional, I’m gonna have a crack at explaining it – on the understanding that if my head explodes, at least one of you has to sing “Wind Beneath My Wings” in a tremulous tone at my funeral.

So… the first phase of thermal purification results from the company’s recent test work program are in, and Quantum is pretty chuffed with how it’s all gone.

Quantum says – and, again, this is very technical – that stuff from its Uley flake graphite mineral deposits located south-west of Port Lincoln, South Australia has been purified at, like, super-high temperatures.

Seriously – they’re talking 2,200-degrees. Crazy stuff.

Anyhoo… the test work highlighted the benefits of Uley flake’s relatively clean geochemistry for use as anode material in Li-ion batteries, especially the lack of any material heavy element impurities.

Other than titanium, which turned up with a concentration of 224ppm (0.0224%), the presence of any other heavy element fell below the detectable limits of the test equipment – which is either great news for the graphite, or they need better equipment.

(Spoiler alert: The equipment is top-notch, and the graphite is the Good Stuff.)

At 2,200 degrees, thermal treatment of Uley flake samples eliminated all impurities with a boiling point of up to 2,200°C and achieved a purity of 97.59% graphitic carbon. Neat-o.

Extrapolating the data out for a heat of 3,000 degrees, Quantum says its Uley flake samples are predicted to achieve a purity ranging from 99.50% gC (80% IRE) to 99.86% gC (95% IRE).

“The Board’s pursuit of our multi-pronged commercialisation strategy genuinely sets QGL apart from other graphite producers,” boasted Quantum chairman Bruno Ruggiero.

“Adding the potential supply of anode material to the Li-ion battery market will deliver on our commitment to build a globally diversified supplier of high-quality flake products.

“Together with our proprietary downstream market in long duration storage media and high-end refractory supply, the production of anode material positions QGL to take advantage of two of the fastest growing markets in the broader industrial minerals sector.”

All jokes aside, it’s big news for Quantum. Yay team!

 

ASX SMALL CAP LEADERS

Here are the best performing ASX small cap stocks:

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We’ve reached the end of the day, so let’s take a look at who’s at the top of the ladder.

The clear winner today is still Besra Gold (ASX:BEZ), up another 49%, resulting in an unlikely three-banger under very trying circumstances to take its gains for the week past 162%.

On Tuesday, Besra announced a US$300m offtake deal with major shareholder Quantum Metal Recovery, securing funding to bring its 3Moz Bau gold project into production.

That announcement was timed to perfection, as gold became super-hot panic-buy property and BEZ flew up 55.0% – and even when the goldies were sold off yesterday, it still managed to pack on another 26.7%.

This morning’s return to safe-haven hunting couldn’t have come at a better time.

Kuniko (ASX:KNI) is up 19.7% after revealing it has chewed its way into an outstanding intersection of visible cobalt mineralisation in a new mineralised horizon at the Middagshville drill target at the Skuterud cobalt project in Norway.

A total of five drill holes returned visible cobalt intersections while another four returned shallow, near surface mineralisation.

The priority of the drill program has been around the Middagshvile target where previous drilling by Kuniko delivered cobalt mineralisation in 8 of 8 drill holes and defined a mineralised zone of 450m, open along strike and at depth.

“This is a superb result from our drilling so far at Skuterud which signals the potential for further exploration upside that remains to be unlocked at the project,” KNI CEO Antony Beckmand says.

And market minnow Renegade Exploration (ASX:RNX) is up another 16.6% today, still flying high on Tuesday’s announcement that its recent RC drilling program has hit large copper sulphide zones at the Mongoose project.

Renegade was required to provide an updated announcement yesterday, which took a bit of the gloss off Tuesday’s 30% lift, but today’s resurgence is a solid sign that investors are pretty happy with how Renegade’s copper hunt is progressing.

 

ASX SMALL CAP LAGGARDS

Here are the least best performing ASX small cap stocks:

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TRADING HALTS

Westar Resources (ASX:WSR) – Capital raising.

Bindi Metals (ASX:BIM) – An “acquisition”. That’s all I know.

Armour Energy (ASX:AJQ) – Capital raising.

Ora Banda Mining (ASX:OBM) – Capital raising.

Weebit Nano (ASX:WBT) – Capital raising.

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