2022. The phrase ‘never a dull moment’ feels apt for investors.

January was a riot, as markets finally decided the US Fed was serious about raising interest rates and sent high-growth tech stocks to the mat.

In February, the world segued into the now-real possibility of an all-out global conflict.

Yep, volatility is still here. But instead of ‘rate hikes and the looming inflation threat’ variety, it’s more of the ‘can Russia remove the Ukraine government by force, and what does that mean for the European Union, NATO and the global world order?’ variety.

In other words, something like this B-grade action clip where Major Payne distracts a soldier from the agony of a bullet wound by breaking his finger instead:

In the monthly wash-up, it was a mixed ASX bag for local stocks.

The ASX 200 eked out a 1.1% gain in February, after slumping by 6.4% in January.

The ASX microcap Emerging Companies index lost another 1.9%, following a 7.7% fall to start the year.

In terms of silver linings, commodities proved their worth in January amid the prospect of tighter financial conditions.

And when geo-political conflict rears its head, commodities are also in demand.

Oil prices are at eight-year highs while other base metals and electric vehicle (EV) supply inputs got a bump over the last two weeks in connection with Russia-related supply shortfalls.

As a result, plenty of junior explorers populated the February Top 50, but it wasn’t the one-way traffic we saw in January when those stocks occupied 90% of the list.

A number of software and biotech stocks also outperformed last month, alongside a long-awaited rebound in a couple of ASX payment stocks.

HERE’S THE TOP 50 SMALL CAPS FOR THE MONTH OF JANUARY 2022

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CODE COMPANY PRICE - Feb 28 1 MONTH % RETURN MARKET CAP
GCR Golden Cross 0.18 847.4% $19,750,610
IS3 I Synergy Group Ltd 0.26 356.1% $47,763,453
BRX Belararox 0.7 233.3% $19,831,014
MAY Melbana Energy Ltd 0.07 204.3% $187,164,277
HOR Horseshoe Metals Ltd 0.03 150.0% $16,364,786
FAR FAR Ltd 0.71 94.5% $70,851,249
CPM Cooper Metals 0.565 71.2% $15,266,300
TMK TMK Energy Limited 0.0135 68.8% $38,880,000
TER Terracom Ltd 0.315 59.5% $237,386,403
TYM Tymlez Group 0.039 56.0% $38,487,209
WHK Whitehawk Limited 0.155 55.0% $35,297,336
N1H N1 Holdings Ltd 0.295 51.3% $24,058,894
AUH Austchina Holdings 0.015 50.0% $26,979,997
PBX Pacific Bauxite Ltd 0.15 50.0% $1,189,876
BGT Bio-Gene Technology 0.29 48.7% $49,164,663
NC1 Nico Resources 0.615 48.2% $53,658,751
HMX Hammer Metals Ltd 0.077 48.1% $62,754,586
HE8 Helios Energy Ltd 0.13 47.7% $338,526,428
MDX Mindax Limited 0.059 47.5% $112,391,211
ITM Itech Minerals Ltd 0.42 47.4% $37,169,999
AUQ Alara Resources Ltd 0.069 46.8% $48,674,617
BOC Bougainville Copper 0.55 44.7% $220,584,375
MEK Meeka Gold Limited 0.052 44.4% $47,860,034
BUX Buxton Resources Ltd 0.1 42.9% $13,605,543
RFT Rectifier Technolog 0.06 42.9% $82,494,237
ATP Atlas Pearls Ltd 0.054 42.1% $23,105,075
HVM Happy Valley 0.071 42.0% $15,089,598
KAM K2 Asset Mgmt Hldgs 0.08 40.4% $19,286,816
NET Netlinkz Limited 0.021 40.0% $68,526,367
CAE Cannindah Resources 0.325 38.3% $170,434,924
BRU Buru Energy 0.255 37.8% $137,302,963
NWH NRW Holdings Limited 2.16 37.6% $985,756,003
QGL Quantum Graphite 0.33 37.5% $96,690,000
AKN Auking Mining Ltd 0.185 37.0% $12,646,703
CIM Cimic Group Ltd 22.09 35.9% $6,876,534,958
FME Future Metals NL 0.23 35.3% $68,665,392
IHL Incannex Healthcare 0.615 35.2% $743,244,722
EVZ EVZ Limited 0.175 34.6% $16,820,428
ARE Argonaut Resources 0.004 33.3% $14,424,819
KEY KEY Petroleum 0.004 33.3% $7,871,713
NTL New Talisman Gold 0.002 33.3% $6,254,451
OEX Oilex Ltd 0.004 33.3% $28,451,806
PCL Pancontinental Energy 0.004 33.3% $28,616,891
BCB Bowen Coal Limited 0.22 33.3% $334,449,489
AMT Allegra Orthopaedics 0.165 32.0% $17,235,768
CLH Collection House 0.145 31.8% $20,582,483
VLS Vita Life Sciences 2.37 30.9% $124,786,690
ALK Alkane Resources Ltd 1.04 30.8% $619,406,757
SAN Sagalio Energy Ltd 0.017 30.8% $3,479,222
PGL Prospa Group 0.98 30.7% $161,364,415
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(Re)-heating is cheating

Copper explorer Golden Cross (ASX:GCR) popped up at the top of Stockhead’s IRESS winner’s list with a monthly gain of 847%, but that figure was somewhat distorted.

By re-heating we mean re-listing, which GCR did on February 18 when it came out of suspension with a $1.5m cap raise after satisfying the ASX’s conditions of reinstatement.

That followed some January data at its Copper Hill project in New South Wales, where GCR said a preliminary review showed promise for indicative copper mineralisation.

Helpfully for GCR, its 18c reinstatement price was around 7x the 2c level that the stock previously traded at.

However, it’s still trading below the 30c level that the company raised its $1.5m injection at.

GCR was also targeting a raise of $3m, and the $1.5m was equal to the amount underwritten by Martin Place Securities.

The company hasn’t had any news since its re-listing and closed out the December quarter with $1.34m in the bank.

Mooning tech microcaps

ASX tech (particularly BNPL) provided some early retirement-level gains in the post-COVID bull run.

But broadly speaking, the pivot to commodities has been underway ever since inflation prints started to run hot in the middle of last year.

However, a couple of tech minnows got on the ramp in February — in a big way.

Among them was affiliate marketing firm I Synergy Group (ASX:IS3), which posted a February gain of more than 350%.

(That was followed by another surge on March 1, which took its cumulative gains since January 27 to more than 500%).

In February, IS3 posted strong gains on 15 out of 17 trading days (and was flat on the other two).

The company got an ASX speeding ticket on February 28, and responded by saying it wasn’t aware of any catalysts that would’ve prompted its February surge.

The stock’s rally followed its January 27 acquisition of Perth-based rewards platform POSTech — the company behind loyalty program app Rewalty — in a share-based deal valued at just under $1m.

Also climbing into the February Top 10 was data software company Tymlez (ASX:TYM), which says it works with clients looking to reduce their carbon footprint by offering blockchain-based technology services.

Like IS3, Tymlez also got a please-explain from the ASX on February 18 but said it too didn’t know what was causing the price spike.

The company released its preliminary annual report on February 28, where it booked no operating revenues and an annual loss of $3.527m. It closed out the year ended December 31 with $4.96m in the bank.

Commodity winners

Before we get too far afield — this is still a commodities market. And there were plenty of small cap resources winners in February despite the broader turbulence.

Near the top of the list was 2022’s best IPO so far; NSW-based copper-zinc explorer copper-zinc Belararox (ASX:BRX).

The stock raised $6m in its IPO in January and closed out February at 70c — good enough for an early return of 250%.

Following its hot start, investors will now await drilling results at two historical copper-zinc mines: Belara and Native Bee, where BRX is aiming to extend the current mineralisation using modern techniques at both sites, where previous mining efforts go back almost a century.

Also high up on the winner’s list is Melbana Energy (ASX:MAY), which has made anyone who backed its onshore drilling efforts in Cuba a very happy investor.

As the Russia-Ukraine conflict pushes oil prices back to the US$100/b mark, Melbana kept the market informed with a number of positive drilling updates at its Alameda-1 well.

In its February 24 update, Melbana said Alameda-1 is “on trend with the nearby Varadero oil field, reported to contain 11 billion barrels of oil in place and responsible for tens of million of barrels of oil production since its discovery in the 1970s”.

Investors are now awaiting initial flow testing work which is expected to be completed in March, with the drilling results so far raising “expectations for the commercial recovery of the oil” at the site, Melbana said.

Healthcare returns

After a no-show in the previous month, a number of ASX healthcare small caps returned to the February winner’s list.

Leading the pack was clinical-stage medical cannabis and psilocybin treatment company Incannex Healthcare (ASX:IHL), which continues to attract investor attention.

The stock closed above 60c on February 28 to bring its annual gains north of 200%, and on February 28 it announced that American Depositary Shares representing ordinary IHL stock have begun trading on the US Nasdaq index.

“By achieving a dual listing on Nasdaq, the Company is now more accessible to a wider audience of investors with sophisticated understandings of medicinal cannabinoids, psychedelic therapies, and pharmaceutical development,” IHL said.

Other notables

Elsewhere, the February winner’s list was populated by a more eclectic list of companies than January, when resources stocks took up 45 of the top 50 spots.

Cybersecurity play Whitehawk (ASX:WHK) posted solid gains, after spending a few days in voluntary suspension to prepare a response to an ASX letter.

The subject of the correspondence was WHK’s announcement that it had landed a US$1.5m contract for a “Fortune 100 US-based global social media company”, following a proof-of-concept period.

Whitehawk announced the deal on its website, but not on the ASX. When the ASX asked why, WHK said that “the key information relating to this client — namely the conversion of a proof of concept to finalising a Master Services Agreement for ongoing services — had already been made known to the market”.

WHK shares continued climbing at the end of the month following the release of its preliminary final report, where the company flagged a 180% lift in annual revenues to US$3.4m.

And another ASX minnow that’s gone on a barnstorming run to start the year is SME lender N1 Holdings (ASX:N1H).

The company ripped higher again following its half-year results on February 28, where it flagged a 73% uplift in revenue to $4,615,503 which flowed through to net profits of $388,212 — a gain of 113%.

N1H said it’s well-placed to drive further growth via the $20m November expansion of its debt financing facility, which increased its total capital available for lending to $90m.

From 6c in June last year, N1H closed out the month of February at 29.5c.

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