The overall mood in the room in the final hour of the ASX on Monday is one of (somewhat bruised) relief – Trump’s latest tariff threats against China, which over the weekend led many investors to predict a second ‘April 2’ slaughter – haven’t yet proven to be as damaging as what we saw earlier this year.
(That could be because earlier on Monday Australian time Trump effectively softened his rhetoric on China when compared to last Friday’s statements that also triggered some interesting moves on crypto markets.)
As for US futures when trying to divine what the ASX might do on Tuesday, investors are looking less spooked than they were over the weekend:
Big ASX takeaway from Monday
Now that the US is expected to increasingly tap allies for critical mineral support – including some reports Australia may be coerced into introducing price floors, potentially for metals like NdPr, a la the Pentagon and MP Materials – investors in Aussie critical metals (read: rare earths) miners and explorers alike have continued a strong run.
For now, gold and REEs remain desirable portfolio inclusions; particularly if the latter have meaningful exposure to US markets and good geology.
Another batch of stocks running hard lately, most notably Electro Optic and Droneshield, both saw declines around -5% in the final hour on Monday as news of an apparent peace deal struck between Israel and Hamas has led to a slight easing of conviction in momentum for those two companies. Still, war in Ukraine continues to roll on.
Companies in the green
Arafura Rare Earths had a strong Monday session reaching new highs as the company benefits from the US-Australia REE thematic following moves by China to further restrict such exports.
Litchfield Minerals meanwhile, by coincidence also in the NT, soared after hitting a 100m+ wide intercept of copper sulphides from surface on-site its project in the Top End. Like gold and silver, copper prices also remain well supported in the current moment.
Finally, St George Mining was also lifted by this geopolitical tide, hitting 14cps and brining 1Y returns to +420%.
Companies in the red
Treasury Wine Estates sunk today after it revealed ongoing difficulties getting people to buy its wine in China, also highlighting some issues around distribution in the US. The company dropped existing guidance for the next two years and also flagged issues around a buyback – not what investors wanted.
PainChek meanwhile was red intraday after announcing its first customer in the US for its aged care home monitoring app on a 3Y contract valued at just A$40K. Last week, the stock spiked one day before it announced an FDA approval for its app in the US; stocks immediately hit 10cps, and just as quickly sold off.
Finally, Invictus Energy receded to 16cps as investors perhaps poke around the traps for similar peers (or similarly priced companies) with attractive liquidity and entry point as the market waits for further updates to come from its deal with the Qatari Royal Family.
That’s Market Close, have a great night and we’ll see you on Tuesday.