The benchmark got off to a pretty good start this morning, knocking out a 0.4% gain which the market then worked pretty hard to squander, approaching flatline on the way towards lunch.

The good news is that it’s bounced again, and at the time of writing, the benchmark’s back on the happy side of zero at +0.25% – I’ll have the details behind that shortly.

But first, a quick delve into the world of AI, which is – evidently – coming under some pretty serious scrutiny, after investors around the world have been throwing enormous stacks of cash at just about anything that has AI even loosely attached to it.

Obviously, it’s a pretty big deal, but the rush on getting money into AI tech and the companies in that space is starting to make AI look less like the Next Big Thing, and more like the Next Big Bubble.

I won’t bore you with a history lesson on bubbles – we’re all painfully aware of just how utterly boneheaded things got during the dot-com bubble of the late 90s, which cost a lot of people a lot of money and, apparently, didn’t teach any of us a mother-lovin’ thing.

Even the Greatest Investor of All Time, Warren Buffett, isn’t immune – word on the street is that he is still smarting from the pantsing he took during the Dutch Tulip Mania of the 1630s.

So the recent fistfights around getting money into AI tech are starting to ring some alarm bells.

It was only recently that Nvidia broke into the Trillion Dollar Company club by stencilling the letters A and I onto the side of a few of their flagship computer chips, which seems to have kickstarted a new surge in interest.

But it was a news item from Europe overnight that has raised a few eyebrows about whether this is a sustainable rush, or an outright disaster waiting to happen.

French startup Mistral AI, founded by former Meta and Google AI researchers, raised more than $166 million in Europe’s biggest seed round ever.

And while the researchers undoubtedly have some fine pedigrees and a few runs on the board, there are a few points to consider that should have the hairs on your neck standing up, even just a little.

Mistral AI, as a company, is just four weeks old – and, as you’d expect from a company that’s younger than a depressingly large quantity of the items in my fridge, it has precisely zero in the way of product.

According to Fortune, the firm’s employees only came on board in the past few days… meaning half of them probably don’t even know where the bathrooms are, let alone which local eatery is going to be supplying them with the gold-plated croissants the company has promised them for brunch every day.

The only thing on offer is a nebulous game plan to develop “a large language model in early 2024 that will be similar to the generative AI technology underpinning OpenAI’s chatbot phenomenon, ChatGPT”.

$166 million in seed money to build something that already exists? How could it not be the investment opportunity of a lifetime?

One indication that all is not well in the AI space, though, is news out of Japan that should give pause to AI enthusiasts everywhere: The career of AI-generated soft porn star Ai Satsuki I wrote about two weeks back has been tragically cut short.

According to the publishers behind the completely unnatural New Face of Weird Asian Porn, the backlash against her was so severe, they’ve been forced to pull all copies of her special photobook from sale, and – shock, horror – her Twitter account has been terminated as well.

If even the highly inventive and outright greasy Japanese soft porn industry – which is quite famously tolerant of all manner of extremely questionable content – isn’t ready for AI, then what kind of future does that tech really have?

I should have an answer for you in a few weeks’ time, when the news inevitably breaks that Mistral AI has burnt through that $166 million in record time, producing award-winning packaging for a product that will never exist.

 

TO MARKETS

After a jump and a slump, the ASX 200 benchmark is at +0.25% this morning, following a mediocre mixed-bag lead-in from Wall Street overnight.

Most of the initial leap and slide are attributable to the volatile tech sector doing its thing this morning, which saw the XTX ASX All Tech index zoom out of the gate and then ease just as suddenly between 10:00am and 11.30am.

It still left the InfoTech sector out in front for the morning on +1.35%, in front of Real Estate – which was due for a win – on +1.1% and Financials, up 0.9%.

At the bottom of the ladder, though, it’s Health Care again… backing up from yesterday’s -4.7% Emergency Room bloodbath with a 1.75% drop, despite positive news for both HeraMED (ASX:HMD) and Careteq (ASX:CTQ).

 

NOT THE ASX

The two-day US Fed gabfest concluded last night, ending with interest rates on hold for the time being thanks to a last-minute reprieve by better than expected CPI data.

However, while it should have been like a Vitamin B shot in Wall Street’s thigh, it definitely wasn’t for a couple of reasons.

First, it was a Christmas in June surprise that everyone kinda knew was coming – and the Fed’s own presentation on the matter of interest rates is still pointing to at least two more hikes between now and the end of the year, which would take rates to 5.6%.

“It may make sense for rates to move higher, but at a more moderate pace,” US Fed chief Jerome Powell told a press conference.

“Not a single person on the committee wrote down a rate cut this year, nor do I think it is at all likely to be appropriate,” he added.

Having been delivered that steaming hot bowl of “meh”, Wall Street responded in kind, and the major indices closed the session mixed: The Dow fell 0.7%, The S&P was flat and the Nasdaq closed 0.4% higher.

Earlybird Eddy reports that Nvidia rose another 5% to its all time high, while another chipmaker Advanced Micro Devices also rose 2% after announcing its line of artificial intelligence processors.

Tesla fell 0.75%, snapping its record 13-day winning streak, possibly after one of the company’s pre-production Cybertrucks was spotted out and about in California.

 

 

The camo paint-job is industry standard for pre-release vehicles on public roads, used by manufacturers to make it difficult for photographers to pick up on external design features that the company doesn’t want made public just yet.

Despite that, though, there’s no denying that underneath the Urban Assault Vehicle paint job, that Tesla looks completely ridiculous.

 

 

Meanwhile in Japan, the Nikkei is up 0.3% this morning on news that AI-generated porn isn’t  as likely to send a generation of young men completely blind by 2035, while China’s  Shangahi markets are up 0.2%, and Hong Kong’s Hang Seng is 0.92% higher as well.

 

ASX SMALL CAP WINNERS

Here are the best performing ASX small cap stocks for June 15 [intraday]:

Swipe or scroll to reveal full table. Click headings to sort:

Code Company Price % Volume Market Cap
GRE Greentech Metals 0.365 248% 17,944,528 $4,400,507
INP Incentiapay Ltd 0.015 88% 1,475,888 $10,120,509
RDN Raiden Resources Ltd 0.005 67% 18,031,042 $6,165,807
AHN Athena Resources 0.006 50% 38,265,603 $4,281,870
MTL Mantle Minerals Ltd 0.0015 50% 780,643 $6,147,446
VPR Volt Power Group 0.0015 50% 139,294 $10,716,208
ERW Errawarra Resources 0.16 39% 620,935 $6,957,960
LKY Locksley Resources 0.087 34% 455,427 $3,149,071
MTB Mount Burgess Mining 0.002 33% 14,820,050 $1,324,757
TD1 Tali Digital Limited 0.002 33% 400,000 $4,942,733
MQR Marquee Resource Ltd 0.06 30% 15,619,950 $15,051,545
MM1 Midasmineralsltd 0.27 26% 378,936 $15,318,624
GLV Global Oil & Gas 0.015 25% 3,643,316 $4,114,556
LYK Lykos Metals 0.1 25% 613,053 $4,992,000
EMU EMU NL 0.0025 25% 586,260 $2,900,043
ENT Enterprise Metals 0.005 25% 300,108 $2,820,323
SFG Seafarms Group Ltd 0.005 25% 349,814 $19,346,397
LCY Legacy Iron Ore 0.021 24% 13,981,778 $108,916,045
HAW Hawthorn Resources 0.12 21% 840,573 $33,166,546
CAV Carnavale Resources 0.003 20% 800,138 $6,833,879
DC2 Dctwo 0.024 20% 433,325 $2,614,322
FRS Forrestania Resources 0.078 20% 445,850 $3,957,935
MRD Mount Ridley Mines 0.003 20% 160,000 $19,462,207
BNZ Benz Mining 0.46 19% 215,678 $37,760,782
CG1 Carbonxt Group 0.082 17% 239,025 $19,270,921
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So… that high-pitched screaming sound you’ve probably been hearing all morning belongs to Greentech Metals (ASX:GRE), which is up 257% on news that rock chip sampling at the Ruth Well Project in the Pilbara region of WA has confirmed multiple lithium bearing pegmatites.

The rock chip assays are coming back sporting grades up to 1.65% from a pegmatite bearing zone about 200m wide and traced for 6km strike, and the company says the zone remains open in all directions.

Another 40 recon samples have since been dispatched to the lab, and results from those are due back pretty soon.

In second place is Incentiapay (ASX:INP), which is up 75% this morning, on a rebound after being sold off heavily on Tuesday.

There’s no apparent reason for the movement in either direction, though – the company hasn’t said boo to the market since late May.

And in third place on +52% today is this week’s semi-sleeper, Errawarra Resources (ASX:ERW), which has been hovering around the Small Caps winner’s circle for a few days now, on no particular news.

The company did offer an exploration update this morning from its Andover West lithium project in Western Australia’s Pilbara region – which didn’t really say much more than “we’re still looking around, but things feel positive” – so it’s likely to be lithium hype-driven, with a spot of “aren’t the neighbours doing well!” thrown in for good measure behind today’s solid gains.

Worth noting as well is yesterday’s high-flyer IperionX (ASX:IPX), which has given back a 32% slab of the gains that it made since Tuesday.

 

ASX SMALL CAP LOSERS

Here are the most-worst performing ASX small cap stocks for June 15 [intraday]:

Swipe or scroll to reveal full table. Click headings to sort:

Code Company Price % Volume Market Cap
BP8 BPH Global 0.002 -33% 33,025 $3,854,189
IPX Iperionx Limited 1.125 -30% 1,020,479 $308,975,353
NGL Nightingale Intelligent Systems 0.05 -30% 473,189 $7,040,849
DDT DataDot Technology 0.003 -25% 130,108 $4,843,811
OAR OAR Resources Ltd 0.003 -25% 2,075,474 $10,284,152
PYR Payright Limited 0.003 -25% 231,161 $3,523,541
BMG BMG Resources Ltd 0.0125 -22% 14,101,683 $9,236,721
AHI Advanced Health 0.16 -20% 1,196,492 $39,440,794
AVW Avira Resources Ltd 0.002 -20% 363,595 $5,334,475
THR Thor Energy PLC 0.004 -20% 1,274,591 $7,300,064
DGL DGL Group Limited 0.96 -17% 1,847,899 $330,496,998
MXC MGC Pharmaceuticals 0.005 -17% 2,591,750 $20,098,158
NAE New Age Exploration 0.005 -17% 246,705 $8,615,393
LDX Lumos Diagnostics 0.012 -14% 1,278,323 $4,331,881
MPR Mpower Group Limited 0.019 -14% 94,118 $6,461,472
AOA Ausmon Resorces 0.0035 -13% 111,939 $3,877,157
AVM Advance Metals Ltd 0.007 -13% 800,000 $4,708,470
RLG Roolife Group Ltd 0.007 -13% 2,506,597 $5,756,465
ROG Red Sky Energy 0.0035 -13% 505,675 $21,208,909
IMI Infinity Mining 0.14 -13% 20,818 $12,236,531
ZEU Zeus Resources Ltd 0.046 -12% 4,420,878 $22,793,940
ASR Asra Minerals Ltd 0.008 -11% 14,786 $13,204,068
CTO Citigold Corp Ltd 0.004 -11% 80,000 $12,931,466
KRR King River Resources 0.008 -11% 3,100,000 $13,981,725
TMX Terrain Minerals 0.008 -11% 1,667,886 $9,748,794
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