The dead cat bounce is done and the pain returned as the ASX shed nearly 3 per cent this week. A reprieve from chat around either United States President Donald Trump or his trade tariffs was never going to eventuate and our favourite orange character announced his “Liberation Day” tariffs on Wednesday. The tariffs were not based on as elaborate a formula as anticipated - Trump whacked payback tariffs on all the countries that have a trade deficit with the US. Australia copped a baseline 10 per cent imports levy – matching what we already impose on the US - but China and a select few South East Asian nations reliant on the US for exports copped some of the largest retaliatory rates.
Beef seems likely to be Australia’s worst hit industry. The US is Australia’s largest beef importer, and American consumers gobbled down $3 billion worth of our premium product last year. Australia does not import US beef due to a trade ban in force since 2003 to protect the nation's cattle herd from a real risk of importing mad cow disease - a factor which has long irritated US trade officials.
Lithium and energy stocks took the biggest hit this week, with a seemingly never-ending surplus of lithium, tariff fears and OPEC hiking up oil production obliterating both sectors.
Australia’s biggest hard rock lithium miner, Pilbara Minerals, shed more than 25 per cent of its market cap on the week as analysts raised eyebrows over its potentially conservative annual production downgrades amid continued weakening lithium sentiment.
Languishing iron ore and lithium major Mineral Resources incredibly dropped a further 25 per cent off its share price on the week. MinRes share price is now more than 80 per cent below its all-time highs of two years ago. The company and its ex-billionaire founder were in more trouble this week as its ‘marginally profitable’ lithium operations approached becoming just ‘marginal’ and founder Chris Ellison was hit with a class action lawsuit from the company’s previously unwavering shareholders.
The powerhouse mining major’s market valuation is getting whacked and is now well below $4 billion, while its $5b debt no doubt balloons.
If there was an upside this week, Trump’s tariffs and global uncertainty brought more glory for gold, as the yellow metal hit a record price of a staggering $5050 an ounce this week.
As you could expect, this week’s Bulls N’ Bears ASX Runners of the Week list is understandably a bit light on – although a few green shoots could be found in a sea of red. A cybersecurity provider finished leagues ahead of the pack to take out first place, while a notable lithium hopeful got a rare mention despite widespread bloodshed across its sector.
Whitehawk Lmt (ASX: WHK)
up 300% (0.8c – 3.2c)
This week’s Bulls N’ Bears ASX Runner of the Week is Cybersecurity firm WhiteHawk Limited, which saw its share price skyrocket to a high of 3.2 cents on Wednesday up 300 per cent from a close of 0.8c last week.
The company’s share price went ballistic after it bagged a major spot as the core cyber partner in a massive US$920M (A$1474M) United States government contract, with industry leaders Knexus Research, Babel Street and Dun & Bradstreet.
WhiteHawk says it will be the sole cyber solution partner to deliver AI-powered tools for managing cyber risks in federal supply chains during the 10-year deal, which could bring in substantial recurring revenue for the micro-cap company as task orders are continually released.
The contract is backed by a 2025 White House executive order and will streamline government procurement, potentially opening up even more opportunities for WhiteHawk.
The size of the contract, combined with WhiteHawk’s pivotal role, likely triggered investors to pile into the stock after its announcement on Tuesday morning.
WhiteHawk experienced a massive $6M in volume on the week with its market cap finally settling at a little over $12M on Friday.
WhiteHawk is delivering its AI-powered tools for supply chain cyber risk management for the US government amid a growing global emphasis on cybersecurity and technological innovation. The company might have the inside track to many more contracts having been tapped as a premium US government provider.
OzAurum Resources Ltd (ASX: OZM)
Up 94% (6.7c – 13c)
OzAurum Resources took out second place on this week’s ASX Runners of the Week list after the gold junior’s share price peaked up 94 per cent to finish at 13c. Well over $7M of the company’s stock traded hands.
The company unveiled reverse circulation discovery drill results from its Mulgabbie North gold project in Western Australia on the same day the gold price ripped to a fresh all-time high. The discovery at its Cross Fault prospect featured impressive thick hits, including 48 metres at 1.66 grams per tonne (g/t) gold from surface and 12m grading some 4.26g/t from 18m.
OzAurum will waste no time starting a follow-up drill program, including diamond drill testing, as soon as next week. The company’s short-term focus is to expand its 260,000-ounce gold resource across its project.
This week’s drill program successfully confirmed the presence of high-grade gold mineralisation over a substantial 400m strike.
OzAurum appears to have jagged a high-grade and sandstone-hosted discovery, with gold mineralisation and extensive quartz veining alongside pyrite and arsenopyrite mineralisation. Wide zones of sulphides were also intersected, indicating the potential for significant gold endowment, OzAurum says.
Sandstones are a brittle host rock and are the hallmark of the large gold deposits being mined at the extremely profitably 4M-ounce Carosue Dam basin, just 2km from Mulgabbie North.
The company believes its new cross fault target is on the Relief Shear some 2km south of the existing 260,000-ounce Mulgabbie North mineral resource along the same shear.
Assays remain to be processed for a further seven reverse circulation holes drilled for 745m, leaving plenty of meat on the bone for shareholders chomping at the bit for gold assays of any kind, in an otherwise loveless stock market.
Argent Biopharma Ltd (ASX: RGT)
up 69% (16c – 27c)
Runners’ final podium finish goes to biotech developer Argent BioPharma Limited after the company revealed its flagship cannabinoid-based therapy CannEpil had been approved for prescription in Germany under a special access scheme.
Argent’s share price shot up on Thursday touching 27c at one point, which was up 69 per cent from last week’s close of 16c per share. The price surged on just $110,000 of stock traded in a tightly held register, in which paper rarely changes hands.
Argent’s flagship CannEpil therapy has a high-CBD, low-THC liquid formulation delivered orally to patients suffering from a form of drug-resistant epilepsy.
CBD in cannabis is increasingly being considered to treat a range of medical conditions, while THC is the molecule responsible for its hallucinogenic effects.
Argent says about 816,000 people in Germany are diagnosed with epilepsy annually and a substantial portion of those patients will have a drug-resistant form of the disease. It believes CannEpil will offer life-changing treatment for patients who have no current attractive alternative.
By strengthening its presence in Germany - a key pharmaceutical hub – Argent has penetrated a substantial barrier to entry to the high priority European market.
With an increasing number of cannabinoid-based medicines gaining global acceptance, the breakthrough marks Argent’s first cannabis-based therapy to be recognised for its central nervous system applications. The company seems confident this feat won’t be its last.
Galan Lithium’s recently completed evaporation ponds being filled at its Hombre Muerto West lithium brine project in Argentina’s Lithium Triangle. Credit: File
Galan Lithium (ASX: GLN)
up 45% (11c – 16c)
Lithium developer Galan Lithium gets a notable mention on this week’s ASX Runners list, having bucked the trend in a disastrous week for lithium thanks to its low-cost Argentinian lithium project in the world-class Lithium Triangle.
The company sneakily turned down a US$150M (A$240M) cash offer from China’s Zhejiang Huayou Cobalt Co and France’s Renault Group to acquire its Hombre Muerto West (HMW) and Candelas lithium brine projects in Argentina, labelling the proposal “opportunistic” and “undervalued”.
The offer rejection was hidden within a secondary trading notice on Thursday morning, which saw the company’s share price open unchanged.
The market quickly cottoned on, with Galan’s share price charging up nearly 50 per cent to a high of 16c per share from a market cap of $92M the week before a high of $134M intraday.
This level was well short of the proposed $240M cash takeover.
The surge defied a broader market downturn.
The unsolicited, conditional and non-binding proposal from battery materials giant Zhejiang Huayou and EV producer Renault was the second such unsolicited offer received by Galan in under a year.
Last August, Galan also received an unsolicited, confidential, conditional, non-binding indicative proposal from Energy Exploration Technologies to acquire the Argentinian assets for US$100M in cash and scrip, which the company quickly batted away.
Galan believes that completing offtake and financing arrangements for phase one of HMW will occur shortly, leading to a more certain and superior takeover outcome than the $240M offer that was ‘just’ 2.6 times the company’s prior market cap.
Galan’s HMW and Candelas projects have a 9.5M-tonne lithium carbonate equivalent (LCE) resource at a high-grade 841 milligrams per litre (mg/L) and the company is more than halfway towards phase one production.
The project is just 100km south of Rio Tinto’s Rincon project, also within Argentina’s prominent Lithium Triangle. Rincon’s non-JORC 5.8Mt LCE resource was acquired by the mining giant in 2022 for a little over $1 billion in a time of more buoyant lithium prices. Importantly, Galan’s Hombre Muerto salar features lithium grades double that of the Rincon project, which comes in at about 420mg/L.
Galan’s decision to bat away takers for its low-cost lithium development seems a puzzling one, but management seems intent on securing the right price for its expansive project - perhaps at a time of stronger lithium prices or once it ‘shortly’ secures an offtake partner and financing.
Is your ASX-listed company doing something interesting? Contact: matt.birney@businessnews.com.au
By Andrew Todd
