After the bloodshed of last week’s budget, Australian markets have calmed a little this week. Aided by US President Trump's latest truth social tirade, the temperamental leader of the free world suggested that the US and Iran were once again in the "final stages” of negotiations.
The hopes of any kind of deal, at least, soothed oil prices and caused Australia's mining sector to take off simultaneously. The sector, which was already flying from last week's budget-induced bank rotation, launched again on Thursday.
BHP looks set for a bumper half-year with copper now its main game and pushing new all-time highs. The red metal is finally surging as long-term demand drivers started to catch up with constrained supply, including EVs, grid buildouts and AI-related data centre expansions.
However, the markets remain extremely wary of the long-term effects of the Strait of Hormuz-inflicted oil limitations. In particular, US bond movements have been wild this week, with massive selloffs signalling traders are concerned about oil-induced inflation.
Sticky oil-fuelled inflation now appears increasingly likely to linger, as escalating Middle East tensions continue to hammer global energy markets and a flood of new US Treasuries drives long-term bond yields even higher.
US 30-year Treasury yields hit 5.19 per cent, the highest level since the 2008 financial crisis, as 10-year bonds – linked to household debt – continue to climb alarmingly.
It also spells trouble for housing affordability with exploding borrowing costs, another reminder that with ever-rising government spending, hard assets and real stuff that produces cash flow are starting to look a lot more attractive.
Meanwhile, in the theatre of the absurdly ambitious, SpaceX has filed for what could be the biggest IPO in history, floating with a potential US$1.75 trillion (A$2.45T) to US$ 2 trillion (A$2.8T) valuation, with the ticker SPCX.
The US$80 billion (A$125B) reported filing highlights the company’s massive AI infrastructure ambitions alongside its Starlink growth.
The pitch is that SpaceX, xAI, Tesla-linked ventures and its sprawling computing infrastructure can take the fight to AI heavyweights such as OpenAI, Anthropic and Google in the enterprise AI arms race.
But this is where analysts start raising eyebrows: xAI reportedly pulled in US$3.2 billion in revenue last year while haemorrhaging US$6.4 billion in operating losses, leaving investors to bankroll an AI moonshot that is still chewing through cash at an extraordinary rate.
It was a cavalcade of all things drones and defence technology this week, as Aussie tech companies once again dominated our Runners list. A fresh drone IPO and a battery-additive specialist came charging hard, only to be narrowly beaten out by a company now building the very systems designed to hunt down and neutralise their technology.
HYDRIX LTD (ASX: HYD)
Up 170% (1c – 3.5c)
Bulls N' Bears Runner of the Week is counter-drone technology company Hydrix Limited, which rocketed as much as 170 per cent on Wednesday after it announced a major strategic pivot into the rapidly emerging counter-drone defence sector.
The pivot will be bankrolled by a simultaneous $3.89 million capital raising, as Hydrix unveiled a binding deal with privately owned global munitions manufacturer NIOA Group to get its venture up and running.
The deal is designed to develop telemetry-enabled payload technology for small uncrewed aerial systems, positioning the company squarely in the middle of Australia's growing sovereign defence push. Its systems will be designed to detect, track and neutralise hostile drones in flight, the part of modern warfare that is still busy catching up.
Hydrix will specifically target mission-critical embedded electronics, guidance software, sensor integration and payload control systems that allow counter-drone weapons to operate with precision in real-world combat environments.
The move comes as the US and Canberra ramp up spending on modern warfare technologies, with up to $7 billion Aussie earmarked for counter-drone capabilities under the latest National Defence Strategy. Investors appear to be betting Hydrix can carve out a lucrative niche in the booming global counter-drone market, which is forecast to grow from US$6.6 billion this year to more than US$20 billion by 2030.
The initial NIOA contract is relatively modest, capped at $1.2 million. Still, the market reaction suggests traders are focusing less on the near-term revenue and more on Hydrix's exposure to one of the fastest-growing areas in modern defence technology.
KTEK AEROSYSTEMS LTD (ASX: KTK)
Up 133% (20c – 46.5c)
Flying out of the gates into our runner-up spot was newcomer KTEK Aerosystems, which debuted on the market Monday with an almighty 133 per cent gain on day one.
The company hit the boards after raising $10 million at 20c a share to advance its production ambitions in end-to-end engineering solutions for aerospace and defence drones.
Cheap, lightweight drones have revolutionised war since the Russia-Ukraine conflict, with millions of drones costing a fraction of previous prices now able to fly in large, indefensible groups targeting all things from tanks to naval fleets even.
Last year, the US re-designated drones from the aerospace budget to the ammunition budget, signalling a shift to mass production. Annual US military drone purchases are forecast to move from 50,000 last year to 300,000 this year and potentially a million within a few years.
The spending wave is staggering. The US Defence budget for FY27 has set aside US$75 billion (A$105B) for drones and counter-drone warfare alone, while NATO members are committing to a defence spend equal to five per cent of GDP by 2035. Even Australia’s measly defence budget has decided it’s a good idea to tip in A$22 billion over the next decade.
KTEK says it can deliver full turnkey sub-assemblies for military UAVs, integrating mechanical, electrical and firmware components into "ship-ready" units for Tier 1 and Tier 2 defence contractors.
The company operates an asset-light “Cordless Factory” model, keeping engineering and quality control in-house while leveraging a global network of certified manufacturing partners. The strategy appears to be paying off, with revenue surging more than 300 per cent across the past two fiscal years to a reported US$3.3 million (A$5m) in FY25.
ANTEOTECH LTD (ASX: ADO)
Up 100% (1.2c – 2.4c)
Our second drone-themed mover of the week and bronze medallist goes to battery tech player AnteoTech, which lit up the boards on Thursday after unveiling independent US testing that appears to strongly validate its flagship Ultranode 95 technology in commercial-scale battery cells.
The results were eye-catching. AnteoTech says the testing demonstrated more than 40 per cent higher energy density than conventional anodes, while also surpassing the cycle-life benchmarks typically required for defence drones and UAVs.
Crucially, the company says the technology also scaled cleanly into larger-format manufacturing, removing one of the biggest hurdles facing next-generation battery developers. Customer evaluations are already underway, with additional samples now being shipped to US drone battery manufacturers.
The validation work was completed at the US-based Battery Innovation Center and builds on encouraging results delivered earlier this year. Ultranode itself is a next-generation high-silicon anode technology designed to dramatically boost lithium-ion battery performance without sacrificing longevity. Testing achieved more than 300 cycles at 70 per cent capacity retention, comfortably ahead of the roughly 200-cycle requirement common across many defence drone applications.
AnteoTech is now advancing discussions on non-exclusive joint development agreements with battery groups that supply, or are likely to supply, US defence drone programs. And with the global drone market forecast to explode to US$160 billion by 2030, even a modest foothold could prove transformational for the small-cap hopeful.
CASTLE MINERALS LTD (ASX: CDT)
Up 48% (5c – 7.4c)
Special mention to round out our Runners is West African gold hopeful Castle Minerals, after the company swooped on a transformational deal to secure a 90 per cent stake in the high-grade Nielle gold project in northern Côte d'Ivoire.
The acquisition hands Castle a proven high-grade discovery in one of West Africa’s hottest gold belts and immediately catapults Nielle into flagship status. Covering 212 square kilometres of the richly endowed Birimian greenstone belt, the project pushes the company’s Côte d'Ivoire landholding beyond 2000 square kilometres of highly prospective terrain.
Importantly, Nielle is surrounded by giants. The project sits just 50 kilometres north of the five-million-ounce Tongon gold mine and along strike from major deposits including Perseus Mining’s 1.5-million-ounce Sissingué operation and Endeavour Mining’s 3.2-million-ounce Wahgnion mine.
Historical drilling has already delivered some serious eye-openers, including 5 metres grading 15.42 grams per tonne (g/t) gold from just 7m, highlighted by a sizzling 2-metre intercept running 31.54g/t from 8m.
Castle believes the shallow, high-grade nature of the mineralisation could fast-track resource definition, while the largely untested 4.5-kilometre mineralised corridor leaves the door wide open for a much bigger discovery.
To sharpen its focus, the company is also clearing the decks by offloading its Ghanaian gold assets. Castle has signed indicative terms to sell its subsidiary, Carlie Mining, for US$400,000 (A$552,000), with US$250,000 (A$345,000) due upfront upon execution of the share sale agreement. The move gives the company fresh firepower to aggressively advance drilling and exploration at Nielle.
Is your ASX-listed company doing something interesting? Contact: matt.birney@businessnews.com.au
By Andrew Todd
