Kick Back: The 10 biggest stories you might have missed on Stockhead this week
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Every new year brings some new fad, but the start of this new decade has delivered something completely out of this world: donning a shape shifting balloon for an outfit.
This has been labelled the “new fashion of 2020”. Pretty cool, but try getting out of that when you’re drunk…
Now here’s what you might have missed on Stockhead this week, but everyone else didn’t, and liked the most.
For small cap investors, initial public offerings (IPOs) often make for an interesting addition to the portfolio.
And in hindsight, 2019 proved to be a good year for paying close attention to who was hitting the ASX boards.
Data compiled by Stockhead just before Christmas showed that of 61 listings, 37 (61 per cent) had returned a gain, with nine companies posting returns of 100 per cent or more. Not bad.
In short, the ASX is a pretty important part of Aussie capital markets, but one expert reckons there might be some headwinds in the IPO market this year thanks to the planned launch of the +$500m Small Business Growth Fund by the big banks and federal government.
Coronavirus fears are gripping several industries and commodities aren’t escaping the fallout.
This new epidemic could result in a 1 per cent hit to China’s gross domestic product and industrial production if the 2003 SARS epidemic is used as a benchmark.
However, commodity analysts CRU Group noted that this time, the impact on global commodity prices was likely to be much larger given that China’s economy had grown significantly in the past 15 years and now consumed about half of the world’s commodities.
Good news for our cabal of rare earths explorers – heavy rare earths (HREE) demand will continue to increase, driven by the nascent electric vehicle market.
$1.7 billion market cap rare earths producer Lynas (ASX:LYC) says market prices of dysprosium and terbium — used in clean energy tech — are increasing as the global supply of HREE decreases.
And, of course, that’s good news for the handful of small aspiring rare earths producers.
Wanna know who that is? Read on.
Market watcher Wood Mackenzie has been very busy compiling its predictions for several commodities for 2020.
The latest is battery metals and disappointed investors were obviously drawn to this yarn in intense anticipation that this year would be a lot better for the ASX’s battered lithium and cobalt stocks.
Wood Mackenzie identified five areas that it would be watching closely in 2020.
Stockhead columnist Tim Treadgold was on the money when he told investors to wait until manganese producer Jupiter Mines (ASX:JMS) had been trading for awhile before injecting any capital.
Why? Because there have only been a few occasions when Jupiter has traded above its 40c IPO price, with the stock spending more time close to its all-time low of 24c, reached around this time last year.
What went wrong for Jupiter, which has a 49.9 per cent stake in one of the world’s best manganese mines, Tshipi in South Africa, was a slump in the price of the steel-hardening material caused by over-supply and sluggish demand in China.
But times, they are a changin’ for the better. So is it manganese’s time in the sun? Tim Treadgold reveals all.
Stockhead’s experienced columnists are dominating the top 10 this week, with a yarn on ASX-listed burns house Polynovo (ASX:PNV) by Tim Boreham taking out the sixth spot.
So far, the twenties have been roaring for Polynovo, with its shares surging 11 per cent to a fresh record high on January 22.
The catalyst was German artificial skin outfit Polymedics Innovations lodging first orders for Polynovo’s lead product, the Novosorb Burns Temporising Matrix (BTM), and the first German use of the product.
It’s not surprising our extensive coverage of the Coronavirus situation has caught readers’ attention, investors clearly want to know just how this crisis will hit markets.
And unfortunately tourism and China-focused stocks are bearing the brunt.
Markets panicked after a positive start to the year and Australian stocks retreated with both the ASX200 and ASX Small Ords falling more than 1 per cent.
Tourism stocks were hit especially hard, with China’s Ministry of Culture and Tourism suspending all tour groups and the sale of flight and hotel packages overseas.
On the flipside, however, this new epidemic has sparked panic buying in things like face masks and hand sanitisers – which is great news for the stocks making and selling that stuff.
ASX-listed small cap Holista CollTech (ASX:HCT) sold out of its NatShield sanitiser in Asia very fast.
But CEO Dr Rajen Manicka didn’t do much to quell the public’s fears saying, “people are panicking, and I don’t think the panic is unjustified”.
“There have been 138 deaths and this virus unlike the others tends to be contagious even in incubation — even before you realise you’re sick. That is a big difference.”
Obviously that number has risen since Nick Sundich spoke to him, but you get the idea.
Crowdfunding is gaining momentum, with platforms having raised more than double last year than what they did in 2018.
And there appears to be no shortage of deals on the cards for 2020.
But does this mean the demise of investment banks? Haha of course not, stupid question. But things might get a little interesting.
The topic of tax is always a controversial one and draws the readers – if for no other reason than so they can have a bit of a gripe about how much tax us Aussies pay. Hey, no argument here!
Although this may make you feel a little better: In 1972, The Rolling Stones were all individually paying a tax rate of 98 per cent (no typo!) on their income.
It’s little surprise then that there is a mass exodus to jurisdictions with better tax perks.
Look on the bright side, at least we don’t have a beard tax like Russia once did, or a baby name tax like Sweden, or a cow flatulence tax like Denmark!
Have a good (sadly, not a long) weekend!