ASX 200 raced ahead by 72 points to 7034 (1.1%) as the Albemarle bid for LTR turbo charged the resources sector and lit the blue touch paper under the bombed out lithium stocks. LTR up 68.5%, CXO up 15.4% and PLS up 11.9%. Huge short squeeze across the board. A bid too in UMG up 30.81% did not hurt the positive sentiment that spilled into resources as a whole. BHP rose 2.0% with FMG up 1.2%. Base metals also doing well with CHN a star on reserve increase, up 8.9%. MIN up 6.0% and LYC catching my disease up 2.8%. Gold miners in a funk as profit taking took hold. NCM down 0.6%, NST down 0.8% and KCN falling 25.4% as it raised some money. Didn’t waste much time after production began at Chatree. Oil and gas better led by WDS up 4.8% and WHC up 6.1% with NHC up 4.2% Banks better. The Big Bank Basket up to $167.89 (1.0%) breathing a sigh of relief that things are settling down in the financial world. MQG rallied 2.0% and insurers and wealth managers better too. QBE up 1.0% and MFG up 3.7%. Industrials were firm. Nothing massively inspiring. Spots of red in some sectors, XRO down 2.9% and the All-Tech Index up 0.5%. Healthcare mixed, REITs better again, CHC up 2.8% and GMG up 0.4%. In corporate news, LTR was the talk of the town, UMG saw froth as it was bid for too. CHN up on a reserve upgrade and MP1 better as a new CEO has been announced, up 4.0%. ORG bid was finalised at around 891c depending on the USD. Few more hurdles with FIRB etc. On the economic front, retail trade better than expected. Something that Solly was telling us yesterday. Asian markets mixed, Japan down 0.2%, HK up 0.7% and China off 0.2%. 10-year yields back up to 3.29%.
- Winners: LTR, UMG, AGY, CXO, AKE, PLS, INR, SYA
- Losers: A4N, DBI, EHE, AAC, BGL, TLX, XRO, ALX
- Positive sectors: Lithium. Lithium. Lithium. Banks. Oil and gas. Coal.
- Negative sectors: Gold miners. Toll roads.
- High 7047 Low 6973
- Big Bank Basket down to $167.89(+1.0%)
- All-Tech index: Up 0.5%
- Gold slips a little to $2925.
- Bitcoin: eases to US$26,965
- Aussie Dollar: Higher at 66.93c
- 10-Year Yield: Pushing higher on retails sales numbers to 3.29%.
- Asian markets: down 0.2%, HK up 0.7% and China off 0.2%. 10-year yields back up to 3.29%.
- US Futures: Dow up 51 Nasdaq up 15
- LTR +68.52% roars ahead on Albemarle bid at 250c. Huge volume.
- UMG +30.81% gets a 500c bid.
- CXO +15.38% AGY +16.25% AKE +13.71% PLS +11.92% short squeeze.
- MP1 +3.95% new CEO.
- WBT +6.75% starting to recover.
- PDN +9.01% joining the resource bounce.
- PMT +23.22% lithium in Canada.
- PIQ +7.34% broker upgrade.
- A4N -6.49% profit taking.
- XRO -2.87% profit taking.
- AAC -4.02% no beef with this one.
- ALX -2.48% director nominations and broker downgrade.
- RHY -7.07% no respite post TGA submission withdrawal.
- KCN -25.37% cap raise weighs.
- SZL -5.26% bit of give back.
- SPECULATIVE STOCK OF THE DAY: Apart from UMG and LTR that is. Nothing.
- Above average volume: ROG, LSA, CBL, EZZ
- Strandline Resources Ltd (STA) completes its fourth shipment of Heavy Mineral Concentrate at Coburn. The company has exported ~35,000t of HMC since commencing commercial production in November 2022.
- Liontown Resources (LTR) – Rejected a conditional and non-binding proposal from Albemarle Corporation to acquire all shares in Liontown for 250cps, stating that it undervalues the company and does not reflect its growth potential, positive near-term outlook for lithium producers, and the scarcity value of its Kathleen Valley Lithium Project. This was the third proposal that Albemarle had put to LTR and it holds around 2.2% of LTR.
- Origin Energy (ORG) – Brookfield pledging to invest billions to accelerate the company’s decarbonization. Brookfield’s bid for ORG equates to $8.912 per share, valuing Origin at $18.7bn.
- SRG Global (SRG) has been awarded a $55m contract by Fortescue Metals Group (FMG) for the construction of a 21-kilometre road at Fortescue’s Eliwana Mine site in Western Australia.
- Nib Holdings (NHF) – Announces it has acquired Connect Plan Management, its third NDIS provider.
- Reliance Worldwide Corporation (RWC) has announced the launch of two new product ranges in the Americas. As well as the company’s Australian manufacturing operations will be reconfigured to support demand in the APAC region, with resources and expertise redeployed to focus on growth in Australia and APAC.
- Chalice Mining (CHN) – Increased the estimated mineral resources for its Gonneville deposit by nearly 50%, to around 3m tonnes of nickel equivalent. The new estimates come after an additional 260 drill holes were incorporated into the data, as well as improvements in metallurgical and economic parameters.
- United Malt Group (UMG) – Malteries Soufflet, the second largest maltster globally, has submitted an indicative proposal to acquire UMG, offering 500cps, which represents a 45.3% premium to the last closing price. UMG has agreed to provide due diligence access to Malteries Soufflet under a process deed.
ECONOMICS & OTHER NEWS
- February Retail Sales data in line with expectations at +0.2% m/m helping the Consumer Discretionary sector up 0.8%.
- ACTU president Michele O’Neil says Australia should study the benefits of a four-day work week as part of the push to boost productivity and help workers achieve more balance in their lives.
- The US agreed to boost cooperation with Japan on critical mineral supply chains and to expand access to tax breaks. EVs that use materials that have been collected or processed in Japan will be eligible for incentives under the US Inflation Reduction Act.
- China’s economic rebound weaker than expected, warns Maersk.
- Private equity deals in Asia plunged 44% in 2022. No wonder they are coming here.
US AND EUROPEAN HEADLINES
- Jeffrey Gundlach said on CNBC that he expects a US recession will start in a few months, and that the Federal Reserve will need to respond “very dramatically.”
- Generative AI set to affect 300mn jobs across major economies.
- Top Fed official blasts SVB collapse as ‘textbook case of mismanagement’.