ASX Small Caps Lunch Wrap: Who will your favourite company be voting for in the US elections?
Strap in – a lot’s happened today… so you might wanna get comfy.
Aussie markets are extending yesterday’s handsome gains, with the benchmark reaching +0.7% at this morning’s open, with the market holding its breath ahead of Aussie CPI data due out mid-morning.
When that data landed, the market went full gonzo, climbing 0.5% in an instant as investors ingested a rare spot of happy news that will no doubt play well for the RBA crowd.
Before that all happened, the early morning rise for the ASX was on the heels of a strong result on Wall Street overnight, where tech stocks rebounded and cruise liner companies remain bafflingly popular among investors and passengers alike.
But before I dig too deep into that stuff, I’m taking you on a little trip into the increasingly wild world of US politics.
Fret not, though – this isn’t a brazen and obvious attempt to rehash the trillions of words already penned on how badly boned former US President Donald J. Trump is, now that he has a list of criminal charges hanging over his head that’s significantly longer than The 10 Commandments his followers claim to live by.
Nope… I’m not even going to mention that he’s staring down the barrel of a severe penalty for breaching the US Espionage Act – which is about as big of a no-no as you can get in America.
And we’re talking about a country where, in certain parts, it’s entirely legal to shoot someone just for being in your backyard.
Like in Florida’s Pinellas County, where local resident Bradley Hocevar fired a full magazine – 30 rounds of ammunition – at Karl Polek, a man the family had hired to come to their home and clean the pool.
According to local police, Hocevar fired two shots through the glass door leading out to the pool deck at Polek, who was hit by shrapnel and broken glass, causing him to flee. Hocevar, meanwhile, just kept blasting away, firing another 28 rounds from his family AR-15 rifle.
No wonder people are risking their lives to enter the country illegally and attempt to subsist on $2 an hour wages, reliant on tips from customers who are in an equally dire financial situation themselves.
Nor am I going to mention that Texas Representative and Ambulatory Custard Ted Cruz – who is not, despite what anyone tells you, not the Zodiac Killer (he totally is, though) – is now under investigation for his role in trying to overturn the most recent US election.
And I definitely won’t be mentioning that US Supreme Court Justice Samuel Alito’s wife, Martha Ann Bomgardner Alito, made a tidy profit leasing out a 160-acre oil and gas field in Oklahoma to a company called Citizen Energy III, while her hubby was busily helping to dismantle the powers of the US Environmental Protection Agency.
No… today, I’m taking you to a town in the very business-friendly state of Delaware, where the town of Seaford, home to about 8,000 people on the Nanticoke River, has decided that it is high time that the US grants voting rights to companies.
A scant 103 years after it allowed women (shock, horror, etc) to vote, the town leaders in Seaford has amended its charter, allowing some 234 entities, including LLCs, trusts and corporations, headquartered in Seaford a vote in local elections.
To put that into perspective, at the last round of local elections (in a country where voting is voluntary, not mandatory like we have in Australia), only 340 citizens bothered to turn up at the polls.
But – and this is important – the charter amendment includes a fairness provision: any company wishing to bend the populace to its corporate will must register with local officials, including a list of the company’s beneficiaries… so that no one accidentally gets to vote twice.
Critics of the plan are, naturally, up in arms about the changes. The influence of Big Biznus in US politics is something of a sore point already, considering just how pervasive business interests have become as part of the political landscape.
The amendment still needs to be passed by the Delaware state legislature, and the jury’s out on which way that vote is going to fall… but its odds-on that Seaford will be welcoming McDonald’s icon Mayor McCheese to the podium to accept his sash and gavel within a decade.
Local markets opened higher this morning, hitting +0.7% when the bell rang to open the session, below the expected +0.9% predicted by the ASX 200 Futures Index earlier in the day.
But then Australia’s CPI data landed, revealing inflation had dropped sharply for the year to May to 5.6%, down from 6.8% in April.
I know, I know… inflation data, blah blah blah, whatever… amirite?
But this time it’s actually really good news – such a large drop in inflation almost certainly puts paid to outgoing (well… friendly, at least) RBA governor Phillip “How does a sweet chariot swing?” Lowe’s plan to nail every Australian mortgage holder to a financial cross before Christmas.
He’s been very busy yanking “the only lever he’s got” for more than a year to get inflation under control, and it looks like it might just have worked.
Well yanked, Mr Lowe. Well yanked, indeed.
Investors reacted by “smashing that like button” harder than a pack of demented Youtube viewers, and the benchmark took off almost instantly, adding 0.5% and climbing higher as we rolled towards a far happier lunch than I think anyone was expecting.
Sector-wise, Consumer Discretionary is top of the pops, up 1.57% this morning, with Financials, Energy, Real Estate and Industrials all offering up better than 1.0% gains.
Languishing, however, was Utilities, which is heading into lunch as the only red sector, down 0.16%.
I’ll lead off this section with a fond vale for a man who has inspired more holes in the ground than The Hobbit and Watership Down combined.
Professor John B. Goodenough – I swear to Baal that’s really his name – has passed away at the ripe old age of 100.
Goodenough was the brains behind the almighty lithium-ion battery, an invention that changed the world and earned him the 2019 Nobel Prize for Chemistry – and kick-started a mining boom that has gripped Australian investors by the
balls hearts and minds for years.
“John’s legacy as a brilliant scientist is immeasurable — his discoveries improved the lives of billions of people around the world,” said University of Texas president Jay Hartzell. “He was a leader at the cutting edge of scientific research throughout the many decades of his career, and he never ceased searching for innovative energy-storage solutions.”
I’d like everyone who reads this to join me in a tribute to Prof Goodenough, by charging your phones to full battery for a screenlight vigil at 7:00pm tonight.
Actually.. make that ‘charged to to 70%’. It’s what he would have wanted.
On Wall Street overnight, tech stocks led a rally that help to partially undo the damage wrought on the US markets on Friday, which saw a major sell-off of some of the biggest listed companies on the planet, according to some bozo who didn’t sleep in this morning, honest.
However, last night’s tech-led recovery for US investors saw the likes of Meta up 3.1%, and metaverse-friendly gaming platform Roblox higher by 6.7% on the heels of a favourable rating from both Bank of America, and a screeching hoard of pre-teen kids, many of whom claim to have “met” my mother whenever they get even remotely aggravated.
US EV maker Lucid spiked 12% after it announced a partnership with Aston Martin, which saw the British luxury carmaker take a 3.7% stake in Lucid in return for access to its high-performance drive-train tech.
Brent crude prices were largely flat as of this morning, on US$72.26 a barrel. Gas prices were also flat and gold edged up a teensy 0.02% to US$1942.20 an ounce.
In Japan, the Nikkei is up 0.7% despite a major backlash against the country’s major television network, Fuji TV, after it was accused of trying to cash in on the horrifying submersible implosion that claimed the lives of four men and a reckless idiot earlier this month.
The network’s schedule had James Cameron’s epically boring film Titanic – the prequel to his most recent bloated undersea monstrosity Avatar: Jesus Christ, Sharon… I’m In The Bath – on the line-up, due to be screened not once, but twice, with the first airing on 24 June.
For those of you playing at home, that’s two days after it was confirmed that all those aboard the Titan submersible had been crushed into diamonds near the bottom of the ocean – with a follow-up screening a week later.
The company said that the schedule was decided sometime in May, which gives Fuji TV some level of plausible deniability, but has left the company open to claims of using witchcraft to cause the accident in order to boost audience numbers, according to some weirdos on the internet.
In China, Shanghai markets are down 0.53% for reasons I don’t really have time to go into right now, while in Hong Kong the Hang Seng is lower by 0.3%.
In crypto, Fidelity Investments, another asset-managing titan of the financial world, has reportedly filed for a spot Bitcoin ETF in the US – following in the footsteps of asset-management behemoth BlackRock.
SEC goon Gary Gensler is reportedly bug-eyed, both by the promise of even more paperwork, and because that’s the way the Good Lord hatched him.
Rob “Stop Touching My Assets” Badman has all the juicy details over at Mooners and Shakers.
Here are the best performing ASX small cap stocks for June 28 [intraday]:
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Top of the Stocks today in Small Caps is Stellar Resources (ASX:SRZ), up 30% at lunchtime after the Tassie-based explorer reported hitting a significant 38.6m-long Zn-Pb-Cu mineralised zone at ‘North Scamander’ in Tasmania, from 130m depth.
The exploration hole had reached a depth of 360m on 23 June with a planned EOH depth of 750m, according to Reubs this morning.
“The significant Zn-Pb-Cu vein and breccia mineralised zones intersected in NSD005 are interpreted as being separate from Zn-Pb-Cu-Ag-Sn mineralised breccia-hosted intersections in historic drilling, highlighting the presence of a significant new Zn-Pb-Cu mineralised zone,” the company says.
Encounter Resources (ASX:ENR), is up 26.4% this morning on news that the company has intersected niobium-REE mineralised carbonatites while drilling in the the Elephant Island Fault at the company’s Crean and Hoschke (formerly Worsley) targets.
Diamond hole EAL001 at the Hoschke target intersected a niobium-REE mineralised carbonatite which returned an assay result from a 24.8m interval of 16m at 0.6% N2O5 and 0.2% TREO (including 402ppm Nd+Pr) from 350m.
Full assay results are due in July or August, depending on how busy the labs are, I suspect.
Here are the most-worst performing ASX small cap stocks for June 14 [intraday]:
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