"2/10 - literally unplayable. Thanks a lot, Red Cross." Pic via Getty Images.
ASX Small Caps Lunch Wrap: Who’s trying to suck all the joy out of fragging a few n00bs this morning?
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Local markets have opened lower this morning, sinking 0.5% in pretty short order, only to lurk there – just under the surface – like a blubbery toad in a foul, fetid swamp.
It feels like that’s about as good as the broader market’s going to get today – the big gainer is an outlier, one-off deal to buy out Blackmores (which I’ll get to in a minute), while the bottom six sectors of the market are all at -0.5% or worse as the market trends down.
But before we get to that, I’ve got a small Community Service Announcement to plug from The International Committee of the Red Cross, which has launched a campaign to get gamers to “follow the rules of war” while they’re killing people from the comfort of their couch.
“Every day, people play games set in conflict zones right from their couch. But right now, armed conflicts are more prevalent than ever,” the ICRC says.
“To the people suffering from their effects, this conflict is not a game. It destroys lives and leaves communities devastated… we’re challenging you to play FPS by the real Rules of War, to show everyone that even wars have rules.”
It’s definitely an ambitious ask from the ICRC – which, if my experience with Call of Duty lobbies is anything to go by, will be met with global howls of derision, and a veritable tidal wave of obscenely racist scorn.
The ICRC has identified four main “rules” it wants players to follow, including “No Thirsting” (which means you’re not allowed to shoot at unresponsive players), and “No Targeting Non-Violet NPCs” (which makes games like Grand Theft Auto completely unplayable).
The committee also wants players to stop targeting civilian buildings, which is dumb because everyone knows those are the best places to hide.
But the best one is a request to use medkits and healing potions on everyone – including your enemies. Whether that’s so you can shoot them again, or the ICRC is assuming that you personally have a death wish, remains unclear.
What is clear, however, is that the vast majority of gamers will cheerfully ignore the pleas from the ICRC to murder people responsibly, because – really – what’s the fun in that?
And speaking of dying a slow, horrible death at the hands of strangers, it’s time to have a look at what the markets are doing this morning.
TO MARKETS
It would appear that local markets are carrying some hefty injuries this morning, down 0.5% and labouring to breathe as a broad sell-off drags the benchmark into the Afterlife.
Looking across the sectors, and there’s a swathe of segments struggling today, including Consumer Discretionary (-0.94%), Real Estate (-0.86%) and Industrials (-0.69%).
The leading ASX index is the XTX All Technology scan, which is sitting around -0.11%, thanks to the Telcos putting in a +0.25% effort to offset a drop by InfoTech of 0.35%.
It’s not very often that we get to see a Large Cap company right up the top of the winner’s list, but this morning Blackmores (ASX:BKL) has gone soaring more than 22% on news that it has entered into a Scheme Implementation Deed with Kirin Holdings Company, which would see Kirin snaffle up 100% of Blackmore’s shares at $95 a pop in a deal worth close to $2 billion.
That is well above – like, nearly $20 per share above – yesterday’s closing price of $76.79 – which speaks volumes about just how keen the Japanese company, most widely known for its range of beers, is about maintaining its inner health.
Many years ago, I was invited to a local Kirin-owned brewery to write a story about their fancy new Gigantic Death Robot Arm the company had installed to tackle the task of stacking full kegs of beer onto pallets – a job that was both back-breaking and gut-busting, which led to at least three brewery workers exploding in a needlessly messy fashion. Allegedly.
The robot arm was large, and silver, and looked preposterously dangerous, like it could at-any-moment hurl a fill keg across the room with devastating accuracy. That’s about all I remember, though, because they handed out some samples towards the end of the tour, and the rest of the day is a bit fuzzy.
But I digress…
The Blackmores deal hinges on shareholder approval, but at that sort of premium price, I’d be willing to put a few pennies on vitamin-enriched, flavourless Japanese beers hitting the market in the coming months.
(Not financial advice.)
NOT THE ASX
In the US overnight, results were mixed as a new banking crisis spooked investors, thanks to First Republic’s rapid, unplanned disassembly over the past few days.
The San Francisco-based lender is seeking a lifeline after losing 40% or US$70bn of customer deposits in Q1. First Republic shares shed another 30% last night after falling 50% the previous day.
But it’s not just a cap-in-hand, help-a-brother-out play. Instead, it’s a hugely ballsy shakedown, in which First Republic has gone to a bunch of bigger US banks waving a fistful of grossly overpriced bonds it wants them to buy.
The sales pitch: “Sure, you’ll lose some money buying these bonds from us at outrageously inflated prices, but that’s chump change compared to the Federal Deposit Insurance fees you’ll get stung with if our little bank fails.”
Along with that sideshow, JP Morgan analysts were painting a bleak picture for the US stockmarket by predicting a big selloff that would see the S&P 500 (currently at 4,055) fall to as low as 3,500 by early US summer.
It’s little wonder markets there were mixed – the S&P 500 index was down 0.38%, the Dow Jones slipped 0.68%, while the Nasdaq lifted 0.47%.
In Japan, the Nikkei has dropped 0.32% this morning as the country deals with the murder of a well-known and well-liked ramen restaurant owner, famed for his ox-tail soup.
Regular diners were shocked to learn that the owner of the Ryu no Hige ramen place in Kobe, 57-year-old Manabu Yojima, had been shot in the head in the kitchen, and his body discovered by an employee who had been “out buying ingredients and didn’t see nothing, I swear”.
Turns out that when he wasn’t running his noodle shop, Manabu Yojima was also heading up the local branch of one of Japan’s most infamous crime syndicates, as boss of the Kodo-kai affiliate of the Yamaguchi-gumi, Japan’s largest yakuza organisation.
Police are investigating whether the slaying was the result of a turf war, or just a bad bowl of noodles. I’ll do my best to keep you posted.
Meanwhile in China, Shanghai markets are largely flat, and Hong Kong’s Hang Seng has dipped 0.43% in early trade.
And lastly, if you’re in the mood for some hardcore pretend-money volatility porn, head on over to Mooners & Shakers, where Rob “Don’t Stop, I’m Nearly There” Badman has the skinny on how and why Bitcoin managed to hit the magic $30k mark, only to plummet 7% again.
Will the excitement ever end?
ASX SMALL CAP WINNERS
Here are the best performing ASX small cap stocks for April 27 [intraday]:
Swipe or scroll to reveal full table. Click headings to sort:
Code Company Price % Volume Market Cap AXP AXP Energy Ltd 0.003 50% 30,027 $11,649,361 LNU Linius Tech Limited 0.004 33% 52,966,954 $9,689,239 SIT Site Group Int Ltd 0.004 33% 14,359,537 $3,903,735 AVE Avecho Biotech Ltd 0.005 25% 530,029 $7,351,477 MTL Mantle Minerals Ltd 0.0025 25% 10,986,349 $10,691,210 AM7 Arcadia Minerals 0.22 22% 224,508 $8,405,621 BKL Blackmores Limited 93.52 22% 451,520 $1,493,614,262 NAE New Age Exploration 0.006 20% 1,430,000 $7,179,495 HXL Hexima 0.013 18% 494,863 $1,837,436 EZZ EZZ Life Science 0.475 17% 239,558 $17,295,525 FFT Future First Tech 0.021 17% 917,191 $12,777,058 BPP Babylon Pump & Power 0.007 17% 250,000 $14,746,628 A3D Aurora Labs Limited 0.022 16% 682,929 $4,670,353 ANR Anatara Ls Ltd 0.03 15% 50,000 $3,118,024 LRL Labyrinth Resources 0.015 15% 109,257 $12,473,335 BKG Booktopia Group 0.27 15% 53,474 $32,279,435 B4P Beforepay Group 0.585 15% 52,718 $17,771,877 SYM Symbio Holdings Ltd 1.9175 14% 642,663 $142,346,987 AHN Athena Resources 0.004 14% 864,500 $3,746,636 MOM Moab Minerals Ltd 0.008 14% 2,571,959 $4,773,744 WMG Western Mines 0.8 13% 5,533,113 $35,110,410 OMA Omega Oil & Gas 0.255 13% 7,824,600 $34,407,932 1MC Morella Corporation 0.009 13% 3,982,655 $48,788,644 ICN Icon Energy Limited 0.009 13% 125,000 $6,144,109 SOR Strategic Elements 0.14 12% 416,936 $55,866,680
While the big winner this morning is clearly Blackmores, there are a handful of Small Caps posting gains on volume or recent news worth talking about, and that includes EZZ Life Science (ASX:EZZ), which is up a shade over 16% off the back of a highly positive quarterly today.
The company has “demonstrated a strong financial performance in the quarter, with cash receipts from customers totalling $11.2 million, a 30% increase from the previous quarter and a 182% increase on the same period last year”, according to the release.
EZZ’s operating cash flows increased by a massive 371% over the previous quarter to $2.8m, leaving the company in a strong cash position at $12.3 million, an increase of about $2.7 million compared to the previous quarter.
Omega Oil & Gas (ASX:OMA) is also having a cracker this morning, on great news that its Canyon-2 gas exploration well in Queensland’s Bowen Basin has returned better than expected net reservoir pay and porosity.
Earlier exploration at the site confirmed the presence of hydrocarbon shows within the Kianga and upper Back Creek Group Formations, and also returned better than expected interpreted porosities averaging more than 9%.
Porosity, which is the tiny spaces between the grains that make up rocks, is – along with permeability – one of the factors that determine if a discovery can produce gas or oil commercially.
Encouragingly, Canyon-2’s average porosity also exceeds that of BG’s (now Shell) Tasmania-1 discovery well, which flowed gas at a peak rate of 0.2 million cubic feet per gas after it was fracture stimulated and tested.
And recent market darling Western Mines Group (ASX:WMG) is back in the news again, climbing 14.8% on news that the company will be expanding its current diamond drilling program at the flagship Mulga Tank Ni-Cu-PGE Project, on the Minigwal Greenstone Belt, in Western Australia’s Eastern Goldfields.
WMG has noted that the MTD026 drill hole is currently at ~400m depth “with significant examples of disseminated and remobilised nickel sulphides observed in top 250m”, while proceeds from the recent capital raise will fund a further eight holes over and above the original Phase-2 drilling program.
And Micro Capper Linius Tech (ASX:LNU) has bumped out a 33% surge on a massive volume spike, after announcing a deal that will see its Whizzard product used in the IMG Replay service, “virtualizing the entire IMG Replay archive to make it more searchable and usable”.
IMG Replay represents the fourth new client signed by LNU in the past five months and is the largest contract to date. The new customer for Linius Tech is a licensing and video clip production service, that appears to specialise in historic sporting event content.
It also holds rights to footage of every Miss Universe contest dating back to 1958, so if ogling women in bikinis who are probably long dead by now is your thing, you know where to find it.
ASX SMALL CAP LOSERS
Here are the most-worst performing ASX small cap stocks for April 27 [intraday]:
Swipe or scroll to reveal full table. Click headings to sort:
Code Company Price % Volume Market Cap HHI Health House Int Ltd 0.004 -56% 3,768,619 $1,604,022 TIG Tigers Realm Coal 0.0055 -45% 30,957,990 $130,667,024 CGO CPT Global Limited 0.215 -34% 27,675 $13,616,644 MEB Medibio Limited 0.001 -33% 333,333 $6,225,891 PVS Pivotal Systems 0.008 -27% 934,551 $2,750,156 AGR Aguia Res Ltd 0.039 -22% 541,174 $21,692,713 GNM Great Northern 0.0025 -17% 25,399,999 $5,127,153 IDA Indiana Resources 0.04 -17% 1,307,010 $24,177,831 MCT Metalicity Limited 0.0025 -17% 2,830,000 $10,513,618 OAU Ora Gold Limited 0.0025 -17% 20,000 $11,810,775 GGE Grand Gulf Energy 0.011 -15% 6,999,827 $21,583,211 SKN Skin Elements Ltd 0.011 -15% 97,500 $6,059,754 HCT Holista CollTech Ltd 0.012 -14% 1,045,000 $3,903,201 W2V Way2Vat 0.012 -14% 80,000 $3,082,126 TFL Tasfoods Ltd 0.025 -14% 63,291 $12,675,770 KNO Knosys Limited 0.065 -13% 89,624 $16,210,402 OPL Opyl Limited 0.026 -13% 243,103 $2,401,952 BAT Battery Minerals Ltd 0.0035 -13% 106,234 $13,427,769 SKY SKY Metals Ltd 0.05 -12% 486,041 $21,476,658 NYM Narryer Metals 0.11 -12% 6,035 $3,810,938 BTR Brightstar Resources 0.015 -12% 240,000 $14,154,690 NGY Nuenergy Gas Ltd 0.03 -12% 290,837 $50,352,487 CSX Cleanspace Holdings 0.31 -11% 5,574 $26,956,833 ACU Acumentis Group Ltd 0.062 -11% 15,640 $15,272,222
