ASX News Live | ASX Ends Higher as Coal Stocks Rally; Webjet, Humm, Tyro, Raiz Feature

After a September review, the S&P/ASX 200 Index is set for a reshuffle, with familiar faces set to exit.

Jewellery retailer Lovisa, lithium developer Sayona Mining, and employee management services provider Smartgroup are set to be added to the ASX 200 index in two weeks.

But some retail favourites will depart.

Family safety app Life360, lithium developer AVZ Minerals, women’s apparel retailer City Chic Collective, fintechs EML Payments and ZIP, and bookmaker Pointsbet are set to be stricken off the benchmark index.

Unsurprisingly, the removed stocks have fared poorly in 2022, with AVZ sheltered by its interminable suspension.

It will be interesting to see what will happen to the short interest of the removed stocks.

Membership in the ASX 200 index leads to more liquidity — and easier access to shares funds can sell short.

Will being stricken off the index see short interest wane?

On the other hand, will addition to the index see short interest in the newcomers rise?

Sayona Mining’s hyped peer Lake Resources, for instance, was added to the ASX 200 earlier this year … and promptly saw short interest rise.

LKE is one of the most shorted stocks on the ASX. The latest ASIC figures show 10% of LKE’s shares are held short.

Will SYA see a similar spike in short interest?

And what about fast-growing retailer Lovisa? LOV continues to open new stores and grow its customer base but currently trades at an extended P/E of nearly 40.

$LOV, $SYA, $SIQ set for #ASX200 entry in a fortnight.$ZIP, $PBH, $AVZ, $EML, $CCX, $360 set for removal.

Will $SYA and $LOV attract more short interest? #Sayona's peer $LKE is currently one of the most shorted stocks on the ASX with 10% short interest. pic.twitter.com/kiHgLDWoIQ

— Fat Tail Daily (@FatTailDaily) September 5, 2022

Growth darlings in their heyday, Zip (ASX:ZIP) and Pointsbet (ASX:PBH) closed lower on Monday. Both stocks are set to exit the S&P/ASX 200 Index in a fortnight.

Bookmaker Pointsbet ended the day 6.4% lower. BNPL fintech Zip ended the day down 4%.

The ASX 200 ended Monday 0.35% higher after the energy sector rallied 4%.

Coal stocks featured heavily among Monday’s best performers, with Whitehaveen Coal hitting a fresh record high earlier in the day as Europe’s energy crisis deepens.

• Coal producer Coronado Global (ASX:CRN), up 7.5%
• Coal producer Whitehaven Coal (ASX:WHC), up 6.5%
• Uranium developer, Paladin Energy (ASX:PDN), up 6.4%
• Lithium developer Core Lithium (ASX:CXO), up 5.8%
• Coal producer New Hope (ASX:NHC), up 5.7%

 

Investing’s power duo — Warren Buffett and Charlie Munger — often speak about the necessity of business moats in finding successful investments.

Business moats stave off the deleterious effects competition has on profit margins.

Find a business with a sustainable competitive advantage, and you are likely to be in the presence of a stock delivering consistently high returns on equity.

But what are the types of business moats?

A great taxonomy was provided by Jerry Neumann in his detailed piece on the matter.

Source: Jerry Neumann

I’m not going to bore you today with the latest ‘will they, won’t they’ on central banks, interest rates, and inflation.

Over the weekend, I remembered that being a ‘Fed watcher’ has never been a way I’ve personally made much money in the markets.

My speciality is in hunting down exponential trends.

Simply put, I like to find new ideas with huge upside potential.

Not only does it take you to the most interesting frontiers of science, but when you get it right, you can also make a heap of money.

It’s how I’ve invested for the best part of two decades, and I follow a pretty simple thought process which I’ll share with you today.

I’ll also show you three ‘exponential’ sectors I like right now.

But the key to this investing methodology starts with one concept you have to realise.

Everyone knows it, but few do it.

When markets are down and fear is peaking, it’s often the best time to start investing in your favourite stocks and sectors.

You don’t need to go all in at once.

My preferred approach is to ‘ladder in’ — a form of dollar-cost averaging — at different price points to take advantage of panic sellers.

This way, you’ll be able to add great stocks on the cheap when others start to get irrational.

Indeed, the market is so short term in its thinking that being able to think one or two years out is a huge advantage for ordinary investors.

It’s your big edge, especially over professionals who’re usually just trying to make sure they’re not underperforming too much every quarter.

You see, if they do, investors pull money out of their funds, and they lose fee revenue.

Their short-term interests don’t allow them to make long-term strategic moves.

But you can…

And in turn, take advantage of the market fear right now as they’re forced to sell down.

But let’s take a step back.

How do you find stocks with exponential potential?

Here’s how I go about it…

https://www.moneymorning.com.au/20220905/it-could-be-time-to-jump-into-these-three-sectors.html

The British pound has never fallen below parity with the US dollar.

But the UK’s economic woes are edging the pound to a historic first.

Overnight, the British pound fell to its lowest level against the USD since 1985.

Source: Wall Street Journal

Reuters reported that global oil companies are reversing a long decline in spending by investing billions of dollars into offshore drilling.

“Surging oil prices are encouraging the investments, along with Europe’s mounting energy demand as the Ukraine-Russia war drags on.

“Offshore production sites are more expensive to build than onshore shale, the last decade’s investment darling. But once they are up and running, they can turn profits at lower prices than other forms of production, according to consultancy Rystad Energy.

“They are also designed to pump oil for decades, a counterintuitive move that could increase financial risk for the projects as the world pushes for net-zero greenhouse gas emissions by 2050 to slow climate change.”

Iron ore continued to slide on concerns over global economic growth.

Iron ore fell 9.5% over the week, with iron ore futures hovering at around US$95 a tonne.

Iron ore #stocks nearing midday:

– $BHP, up 2.4%
– $RIO, up 1.5%
– $CIA, up 1.5%
– $FEX, down 2.8%
– $FMG, down 5.5% https://t.co/7F7RPOUPuO

— Fat Tail Daily (@FatTailDaily) September 5, 2022

Energy explorer Renergen is set to become a producer, with its Virginia Gas Project in South Africa now operational.

Renergen has started filling bulk storage tanks in preparation for product delivery.

RLT said the project is set to become South Africa’s first commercial LNG plant.

CEO Stefano Marani commented:

“This watershed moment in the Company’s lifecycle has finally arrived. This is a significant step on the path to showing the world that Renergen can become a global player in liquid helium supply and a material local supplier of much needed LNG. The transformation of the Company since first listing in 2015 has been truly incredible, and I am very proud of the efforts, hard-work and determination of the team in getting Renergen to the position we find ourselves in today. Virginia is a world-class project, and we will now focus on ramping-up operations to full Phase 1 capacity over the coming months.”

RLT shares are currently up 2.5%, and up 55% over the past 12 months.

Watch veteran trader Murray Dawes as he goes through the week that was in the markets and explains how he sets up his trades.

Micro-investing fintech Raiz (ASX:RZI) released its August metrics.

Customer sign ups, investment accounts, and active customers all rose modestly month on month in August.

Global funds under management are now $1.026 billion, up 4.9% over the past 12 months.

RZI’s total FUM is actually down from December 2021’s peak of $1.034 billion.

Customer sign ups are up 49.5% over the past 12 months.

RZI shares are down 70% year to date.