The ASX has bounced, jumping 0.9% at open and trending upward throughout the morning, as the Energy and Financials sectors got some solid floor beneath their feet for the first time in days.

The rise this morning has outpaced the ASX 200 April futures contract, which was pointing up by 0.65% at 7.30am – unlike me, who at 7.30am was still well and truly face down and pretending like it was Sunday.

What I could have used this morning was a hug – something that Mexico’s clearly insane President seems to agree with.

He’s blamed America’s horrifying opioid crisis on families not hugging their kids enough.

“There is a lot of disintegration of families, there is a lot of individualism, there is a lack of love, of brotherhood, of hugs and embraces,” Andrés Manuel López Obrador said. “That is why [US officials] should be dedicating funds to address the causes.”

The comment neatly sidesteps the actual causes of the fentanyl crisis that has been blamed for about 70,000 overdose deaths per year US – those being allegedly predatory sales tactics by certain large pharmaceutical companies, coupled with a health system that is so evidently broken that it’s now too big of a problem to actually fix.

That, and claims that the vast majority of the fentanyl found on the streets in the US is being made in Mexican drug labs, from precursor chemicals being shipped in from China.

López Obrador has history when it comes to saying profoundly dumb things. His recent Twitter disaster claiming that a photo of a monkey, taken in Indonesia in 2021, is proof that mystical elf-like spirits from Mayan folklore called aluxes are real, and present in Mexico, for example.

 

 

The best part of that story is the fact that the tweet is still there, nearly a month after the entire world called the Mexican president out about being dumber than dogsh-t.

This is, as they say in the classics, democrrrrracy manifest.

 

TO MARKETS

As we head into the lunch break, the ASX 200 benchmark is at +1.27%, with Energy (+1.98%) and Financials (+1.74%) rebounding after a string of utter horror shows over the past handful of sessions.

The market is tracking higher thanks to an outburst of positivity in the US and Europe overnight, which we’ll get to in a moment, but while that has delivered a fresh half-ounce of hopium for investors, it’s not all great news.

The XEC Emerging Companies index is still flat, indicating that while investors are keen to get their money in at what looks like a short-term bottom for some of the big names that dropped value recently, the riskier Small Caps market remains a bit raw.

Among the big kids winning today are three top-tier resources mobs, namely Stanmore (ASX:SMR) up 5.35%, Whitehaven (ASX:WHC) up 5.50% and New Hope (ASX:NHC) up 8.78% – but it’s worth remembering that they all took a hammering in recent days.

Losing ground today was West African Resources (ASX:WAF), down more than 3.0% after dropping its annual report this morning. WAF says its profit for 2022 has fallen to $183.7 million, down from $214.4 million in 2021, with a sharp rise in all-in sustaining costs to US$1086/oz.

 

NOT THE ASX

That weird noise you were hearing all night was the sustained absence of people screaming as they ran around various world markets with their heads on fire and their goolies in a vice.

Investors helped Wall Street to a relief rally as the S&P closed 0.89% higher, the Dow Jones up by 1.20%, and tech heavy Nasdaq by +0.39%, while markets across Europe also lifted by around 1%, after everyone decided that it might be a good time to Calm TF Down and get smart about what’s been happening.

The next 24 hours will still be fairly fraught, though. The US Fed is due to drop its rates decision on Wednesday, while we’re all asleep so Jerome Powell doesn’t have to look us in the eye when he scuttles the market again.

Earlybird Eddy Sunarto reported this morning that Goldman Sachs is predicting a recession in the US, and a risk-off climate for stock markets in the foreseeable future.

“Market-implied recession risk for the next 12 months has picked up above 50 per cent, with Fed pricing being a core driver. There has also been a material repricing of risk premia for banks in equities and credit,” said the note from Goldman.

That lines up with Oanda analyst Edward Moya’s take: “US stocks are wavering as risk aversion won’t be going away until markets are confident that the Fed is done with their rate hiking campaign”.

In Japan today, the Nikkei has dropped 1.42%, as the country deals with the shocking news that, for the first time ever, a Member of Parliament has been expelled without setting foot inside the National Diet.

Yoshikazu Higashitani, who is more widely known by his YouTube handle GaaSyy, was elected more than seven months ago, off the back of his fame as a celebrity gossip vlogger.

However, he’s been in self-imposed exile in the United Arab Emirates, refusing to come back to Japan as he is convinced he will be arrested and have to face fraud charges, as well as civil lawsuits from Japanese celebs who he’s allegedly defamed.

And so, for only the third time in more than 70 years, Japan has expelled an MP, creating a story which is about as 2023 as you could get, and which really doesn’t bode well for the future of democracy.

Speaking of which, in China, Shanghai’s markets are up 0.44%, while in Hong Kong the Hang Seng has risen 1.08% in early trade.

 

ASX SMALL CAP WINNERS

Here are the best performing ASX small cap stocks for March 21 [intraday]:

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

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Leading the way in Small Caps today is Besra Gold (ASX:BEZ), which has gone soaring with a 72.5% leap on news that it’s inked an (up to) US$300m gold pre-purchase and offtake non-binding drawdown funding facility term sheet with major shareholder Quantum Metal Recovery.

Besra says the company believes it to be one of the largest deals of its kind signed by an ASX listed junior, with the money to flow in over 30 months against future production ounces, enabling Besra to fully fund production at Bau and the appraisal of other deposits within the Bau goldfield corridor.

Also charging hard today is Galileo Mining (ASX:GAL), on news that it’s drilled into a monster 72m intercept at the Callisto palladium-nickel discovery within GAL’s 100% owned Norseman project in Western Australia.

The intercept is juicy: 72m @ 1.16g/t 3E1 (0.95g/t Pd, 0.16g/t Pt, 0.05g/t Au), 0.20% Cu & 0.24% Ni from 498m, which includes a handsomely higher-grade interval of 39m @ 1.46g/t 3E (1.19g/t Pd, 0.20g/t Pt, 0.06g/t Au), 0.26% Cu & 0.28% Ni from 503m.

Galileo says that the result supports its geological interpretation that the 5km of untested strike length to the north of Callisto is highly prospective for further discoveries, which has really excited investors. GAL is trading 45.3% higher so far today.

Meanwhile, Mincor Resources (ASX:MCR) is surging on news of a takeover offer from The Wyloo Group, for the whole Mincor kit and kaboodle on market at $1.40 cash per share.

Wyloo is already Mincor’s major shareholder, with 19.9% of the company in its pocket, and is prepared to dig deep to make the buy.

The $1.40 bid per share implies an equity value for Mincor of roughly $760 million on a fully diluted basis,  and represents a 35% premium to the closing price of Mincor shares on 20 March 2023, the last trading day prior to this announcement, of $1.04 per share.

It’s currently at $1.47 per share, a rise of 41.5% for the day.

And lastly, market minnow Renegade Exploration (ASX:RNX) is up 30% this morning on news that its recent RC drilling program has hit large copper sulphide zones at the company’s Mongoose project.

Renegade director, Robert Kirtlan, says assay results will be forthcoming in 2-3 weeks, and it’s an exciting time for the company.

“Within two months of assuming control of Mongoose we have completed a maiden RC program and it has all the hallmarks of being very successful.” Kirtlan said.

“Multiple large zones of visible copper mineralisation have been hit in the drilling program.

“One such zone is located underneath the appropriately named ‘Malachite Hill’ which has not been tested by prior drilling and has a potential strike of over 200m and remains open to the south, east and at depth.”

 

ASX SMALL CAP LOSERS

Here are the most-worst performing ASX small cap stocks for March 20 [intraday]:

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

Wordpress Table Plugin

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