CLOSING BELL: Like glands through the shower glass, this was a day of our lives
Well, colour me impressed, ASX 200 – at lunchtime, I was sure you were an absolute goner and I will admit that I was ready to drop you off at the vet for a very, very long nap. The benchmark had sunk 0.7% by 12:00pm, and a recovery at that stage was looking about as likely as the Aussie bowlers delivering anything other than a lacklustre performance on Day 3 at Arun Jaitley.
And yet, here we are – we’re grinding our way towards the dinner bell, and the ASX is rising like a slo-mo Lazarus, creeping upward to within 0.2% of “not terrible” in the middle of the afternoon session. Sadly, that’s as far as the benchmark made it, and so that’s where it’s been left to lie – 0.2% down after a day of drama that moved so slowly, it could easily have been mistaken for a month’s worth of the torpid and tedious US soapie, Days of our Lives.
Probably the biggest news that made surprisingly little impact came from Magnis Energy Technologies (ASX:MNS), after a massive announcement from Tesla with some huge implications for the Aussie battery metals player.
NEWS: @Tesla is rumored to have signed an offtake deal with Australian battery materials company Magnis Energy Technologies.
— Sawyer Merritt (@SawyerMerritt) February 20, 2023
The ever-capable and devastatingly-handsome-if-you-catch-him-in-the-right-light Reuben Adams has given us this solid wrap-up of all the details, which you should definitely go and read because I really don’t feel like re-writing it here.
What I will say, though, is that while a 6.1% rise for Magnis today is undoubtedly a fine result, it’s a long way short of where you’d normally expect a battery metals market announcement of this nature to land – so maybe some of the chatter about the heat well and truly coming out of battery metals shares is true.
The rest of the morning on the ASX was bruising, though, and a number of big players weighed pretty heavily on the market and made people feel sad and angry and a host of other feelings that we’re simply not equipped to process.
That included BHP (ASX:BHP), which was down by around 2.0% at one stage today on news that half-year profits had slumped 32%, as the miner continued its coal mine fire sale and – gasps of horror – slashed divvies, which never goes down well with shareholders.
Supermarket giant Coles (ASX:COL) also had a curious run today, and I reckon it played out like this: Investors were presented with a laundry list of announcements from Coles this morning, and among the earliest of them was news that chief exec Stephen Cain is stepping down, with Leah Weckert named as the first woman to lead the company, ever.
This made people happy, and Coles’ price went up for a little while. And then they read the earnings report, which is actually pretty good. The take home (provided you brought your own reusable bags) is a solid 11.4% NPAT increase to $616 million, off the back of revenue totalling $20.8 billion dollars.
But, for some reason, investor enthusiasm went off faster than out-of-season stone fruit, and Coles is set to end the day lower, down by around 1.4% – less if you have a coupon, but.
And Ingenia Communities Group (ASX:INA) came out of a trading halt today bearing bad news – it had failed to turn increased revenue into profit, which fell 16% for the half-year to $33.7 million.
Investors have voted with their feet, and INA was dumped to the tune of more than 20% today, but has since recovered some ground to close out around 14.0% down for the day.
In Japan, the market is still cowering from the 16-metre tall Gundam robot that appears hellbent on reducing Yokohama to a smoking crater, so the Nikkei’s down 0.11%.
In China, markets are moving in mysteeeerious ways again – Hong Kong is, like just about everywhere else, down by 0.99% but Shanghai has managed to climb… not much, but it’s 0.1% higher, and I have the X-Files theme music running through my head.
A quick look at the headlines from near and far will reveal that things in the United States on President’s Day were far from ideal.
A testament to the state of Ohio’s recent foray into the world of industrial-scale deregulation (aside from the toxic train wreck from last week) was an explosion at a metals plant that has sent 14 people to hospital and covered a large chunk of the state in a cloud of toxic fumes. Again.
Meanwhile, in Washington, burgeoning Republican powerhouse Marjorie Taylor-Greene has used The Holiest Day in American Politics™to call for a “national divorce”, which would see Republican states break away from Democrat states, to make their own country (with blackjack and hookers, because that’s how you do it properly).
It’s been quite some time since the last serious push for The Union to be broken up – and the last time it happened, more than 620,000 men (around 2.0% of the total US population at the time) died at the hands of their own countrymen, so this new push for a split is unlikely to end well.
Meanwhile, Yahoo News (yeah, I know…) reporting that a document purportedly leaked from somewhere deep inside Russian leader Vladimir Putin’s inner circle lays out in startling detail Moscow’s plan to absorb Belarus, in much the same way an amoeba will eat something by surrounding it with its butt.
According to the document, Moscow is angling at forming that catchily-named Union State of Russia and Belarus by 2030. Based on Russia’s “5-6 days, maybe a week, tops” invasion of Ukraine now dragging towards a terrible birthday, “by 2030” probably means “thousands of years from now”.
Locally, ABC News is reporting that Australia is likely to “flirt with recession” this year, based on a dour assessment of the economy by National Australia Bank.
Not quite sure how the mechanics of that actually work, but if Recession’s willing to buy me drinks all night, I’ll laugh at all its stupid jokes and bat my eyelids at it with the best of them.
“Looking forward, we see growth slowing sharply as consumer spending comes under pressure from both higher rates and inflation,” NAB chief economist Alan Oster said.
“On GDP, we see the quarterly rate of growth slowing to around 0.1 per cent in mid-to-late 2023,” the NAB report says, adding that “sees through the year growth slow to just 0.7 per cent in 2023 and 0.9 per cent in 2024 before around trend growth of 2.2 per cent in 2025”.
Meanwhile, the RBA released the minutes of its last meeting, which paint a pretty bleak picture of the mood around the dining table, once the board was done feasting on $50,000/kg caviar and whole lobsters on a stick.
“The recent inflation data had suggested more breadth and persistence in inflation than had been expected and that strong demand was leading to price increases in some parts of the economy,” the RBA minutes read.
“While inflation was expected to decline, there was a risk that it could persist at an uncomfortably high level, which would entail longer term costs.”
It’s a far cry from the board’s pandemic-era predictions that Australians would be waiting until at least 2024 to see rates on the rise, but RBA chief Lowe is still pretty salty that he’s copping all the verballing down the pub over the whole sordid mess.
Here are the best performing ASX small cap stocks:
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In Small Caps today, the day’s clear standout has been tech mob Connexion Telematics (ASX:CXZ), which has raced to an 80% gain on news that its “cornerstone OEM customer” General Motors has extended its contract with CXZ.
Connexion Telematics is the developer of Software as a Service (SaaS) solutions for the global automotive industry, most notably (and relevantly to this story) its OnTRAC and CXZTRAC platforms, with the former used used by GM to manage the largest Courtesy Transportation Program (CTP) in the US.
Metarock Group (ASX:MYE) – The Company Formerly Known As Mastermyne – is up 48% and change after announcing that the kerfuffle over its Gregory Crinum coal mine contract has finally reached an end.
Metarock’s fight with Japan’s Sojitz Corporation has “reached a full and final settlement”, with MYE set to pocket “additional impairment for balances” of $11.1 million – plus whatever money the company is set to raise when it sells off a bunch of equipment originally intended for the Gregory Crinum project to a third party.
And lastly for the day, New Century Resources (ASX:NCZ) is up 42.5% on the heels of an unsolicited takeover bid by South Africa’s Sibanye-Stillwater at $1.10 per share.
Sibanye-Stillwater already holds a 19.9% stake in NCZ after taking part in an equity capital raising that was completed in December 2021, so the takeover bid isn’t exactly out-of-the-blue – but it did put a lot of wind into New Century’s sails this morning.
The result has been an enormous volume of trade (more than $34.4 million worth between the bells), and NCZ’s price has – predictably – climbed to… $1.10 a pop.
But you’d already figured that out, hadn’t you?
Here are the least best performing ASX small cap stocks:
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A mix of news from Antilles Gold (ASX:AAU) today, after the company announced that its long-awaited revised Scoping Study for the La Demajagua mine in Cuba will be delayed for another 3 to 4 weeks.
Word is that there’s been a delay in getting additional antimony assays from the 29,000m of drill cores undertaken in 2022 back, and they’re needed so that they can be incorporated in the JORC Resources and mine planning for the project.
But, on the plus side, Executive Chairman Brian Johnson (who has, to the best of my knowledge, never sung for AC/DC, so it’s probably a totally different guy) recently had a sit-down with Cuban Minister for Energy and Mines, whose name is arguably one of the most baffling cultural mash-ups I’ve ever seen: Vicente de la O Levy.
Anyhoo… Brian and Vincente had a chat, and Brian says that Vincente said that he (Vincente, not Brian) would support a request to increase Antilles Gold’s shareholding in the joint venture company, Minera La Victoria (“MLV”), from 49% to 50% to “better reflect the partnership arrangement with the Government’s mining company, GeoMinera”.
Cat Camp lithium-nickel project, located 425km east of Perth, Western Australia in the lithium regions of Lake Johnston and Lake Percy, has previously shown successful exploration for nickel and identified anomalous lithium bearing pegmatites, BOA says, adding that it believes that “opportunities exist as neither commodity has been completely tested”.
“Completion of the agreement with Duketon on the acquisition of Cat Camp adds another major string to our portfolio of lithium and nickel projects,” BOA managing director Jon Reynold said.
“Our primary focus will be determining the extent and lithium fertility of the previously identified pegmatites.
“The Lake Johnston and Lake Percy regions already demonstrates the so-far-identified lithium fertility of the regional pegmatites and with this tenement acquisition Boadicea is adding to its excellent lithium potential.”
Cyprium Metals (ASX:CYM) – Update to the financing of the Nifty copper project restart.
AuKing Mining (ASX:AKN) – Proposed cancellation of recently granted tenements.
Red 5 (ASX:RED) – Capital raising.
Koba Resources (ASX:KOB) – Capital raising.
Cokal (ASX:CKA) – Capital raising.
Earlypay (ASX:EPY) – Sale of assets of RevRoof by Earlypay’s appointed receiver.
Queensland Pacific Metals (ASX:QPM) – Announcement regarding the gas supply chain.
Talga Group (ASX:TLG) – Capital raising.
Charger Metals (ASX:CHR) – Drilling results from its Lake Johnston project.
CogState (ASX:CGS) – ASX speeding ticket response.
That’s it from us for the day. Join us again tomorrow for another bottomless pit of percentages as we play Where’s All Our Super Gone?