ASX News LIVE | ASX to Slip; Musk’s $56b Pay Approved; DRR Sinks on Lithium Play

The ASX 200 closed down -0.33% to 7,724.3 today as the market failed to recover from losses seen in the first hour of opening today.

Only the Discretionary and HealthCare sectors finished up as the major market caps fell back amidst macro uncertainty in Europe and the US.

This was the third loss in four days for the Aussie benchmark, with the ASX 200 closing down by -1.25% for the past week.

The ASX continues its sideways movement, up only 1.76% in the year so far.

The outperformer today was Dimerix on the wider ASX 300, up by 11.21% as investors expect positive results from its latest trial going to be presented soon, while Opthea fell by nearly -25 % after its capital raise.

Overseas, the big news today was the Bank of Japan’s decision to hold its ultra-low interest rates between zero and 0.1%, when it met today.

It also didn’t provide guidance on the rate of future decreases in government bond purchases.

Opthea [ASX:OPT], a promising biotech company, has successfully closed a capital raise of $171.5 million from institutional investors today.

The company also announced plans for a fully underwritten $55.9 million retail investor offer.

The funds raised will provide Opthea with sufficient capital to support its ongoing pivotal phase 3 clinical trial for an innovative eye disease treatment.

The trial results are anticipated to be available between the second quarter and mid-2025.

Shares are down by nearly -24% in this afternoon’s trading new shares are issued and traders expect the price to fall further on the raise.

The Bank of Japan (BoJ) has maintained its interest rates at near-zero levels following a unanimous vote by the board. The decision comes as no surprise, as the central bank continues to grapple with economic challenges in the country.

With this move, Japan’s short-term interest rate target remains officially between 0% and 0.1%. In its statement, the BoJ acknowledged that while the nation’s economy has experienced a moderate recovery, weaknesses persist.

As a response, the AUD now buys 104.783 JPY.

Despite keeping rates steady, the central bank has opted to scale back its bond-buying program, signalling a potential shift in its monetary policy stance.

The global rare earth metal market has been heavily influenced by China’s dominant position in the industry.

China has long been the world’s largest producer and exporter of rare earth metals, accounting for over 80% of the global supply.

This near-monopoly has allowed China to exert considerable control over prices. In recent years, China has implemented various measures, such as production quotas and export restrictions, to regulate the supply and maintain price stability.

However, these actions have also raised concerns among other countries about the potential manipulation of prices and the security of their rare earth metal supply chains.

Here is a great infographic by mining investor Paola Rojas on what prices it would take for the rest of the world to compete with China’s stranglehold on supply.

It's really pretty simple

(yet hard to do)

REE prices need to be much higher to incentivise ex-China supply.$LYC #rees

📊 @benchmarkmin pic.twitter.com/CHbooKmEjy

— Paola Rojas 🐝 (@paola_rojas) June 13, 2024

 

Telix Pharmaceuticals [ASX:], a promising cancer treatment company, has suddenly withdrawn its plans to raise US$200 million ($300 million) and list on the Nasdaq stock exchange.

Last week, Telix announced its intention to pursue a secondary listing in New York and its shares on the ASX, where the company has a market capitalisation of approximately $5.4 billion.

The stock was placed in a trading halt yesterday in anticipation of the Nasdaq initial public offering but it seems the company has had a change of heart.

The decision comes after the company faced pressure to offer significant discounts to attract investors in the United States.

Telix’s inability to list on the Nasdaq is a setback for the Company, which has consistently promoted its growth to US investors. In January, CEO Christian Behrenbruch presented at JPMorgan’s healthcare conference in San Francisco.

The withdrawal of the IPO raises questions about the company’s ability to attract US investors and its future growth prospects. Telix will now need to reassess its fundraising strategies and consider alternative options to support its ongoing development of cancer treatments.

The ASX 200 is down by -0.31% at midday, trading at 7,725.8 even as Wall Street crept up to record highs driven by optimism around AI.

This morning only Discretionary, Healthcare and Real estate were in the green as industrials and mining saw sell downs from their mega caps.

Locally, tech company Life360 and uranium miners Boss Energy and Deep Yellow were among the top performers on the benchmark this morning.

However, Deterra Royalties faced a -5.8% drop in its shares after announcing an all-cash offer for British lithium mining group Trident Royalties.

The £144 million ($277 million) deal marks a shift into lithium and green metals for Deterra, which has traditionally relied on royalties from BHP’s iron ore streams. The move drew criticism from some investors, with fund manager Andrew Brown questioning the logic behind diluting the BHP royalty.

In other news, the Bank of Japan is expected to maintain ultra-low interest rates between zero and 0.1% at its upcoming meeting.

US tech giants Nvidia, Apple, Broadcom, and Adobe continued their upward trajectory, while Tesla’s shares rose after shareholders approved Elon Musk’s $US56 billion pay package.

European stocks, however, took a hit following the French European Parliament elections, where Marine Le Pen’s National Rally party dealt a blow to President Emmanuel Macron’s centrist alliance, prompting parties to reassess their strategies and candidates.

Citi has updated its earnings projections for copper stocks today.

The price of copper is near its lowest in over a month in the midst of low demand in the near term after further weakness in China’s latest PMI.

Chinese copper inventories are at their highest level since 2020, but traders are hoping for a medium-term reversal.

Source: Tradingeconomics

The broker increased its copper price estimates to $US12,000 a tonne for 2025, up from the previous forecast of $US10,000 a tonne.

According to Citi, the metal is expected to consolidate in the range of $US9,500 to $US10,500 a tonne during the September quarter.

The broker believes this will present a buying opportunity, propelling prices to an all-time high of $US12,000 a tonne by the end of the year

Although Sandfire Resources is the only pure-play copper exposure in the ASX 100, Citi anticipates that investors will now seek deeper exposure to the metal.

Citi also reaffirmed its preference for BHP over Rio Tinto due to its copper exposure and Evolution Mining over Northern Star Resources.

At Tesla’s annual meeting held in Austin last night, investors voted in favour of CEO Elon Musk’s compensation package and the relocation of the company’s state of incorporation to Texas.

Although the EV manufacturer announced the results, it did not provide a detailed breakdown of the votes.

It’s also worth noting that the pay vote is non-binding and does not guarantee that Musk will receive the pay outlined in the package.

In January, a Delaware judge invalidated Musk’s 2018 compensation plan, a decision that Tesla is expected to appeal. Under the terms of the 2018 package, Musk would have been eligible to receive up to $55.8 billion in stock options if Tesla achieved certain milestones.

However, as of the close of trading on Thursday (US time), the current value of these options had decreased to approximately $48.4 billion, according to the Bloomberg.

Good morning. Charlie here,

The ASX 200 opened down -0.20% this morning to 7,734.6 but could end the day flat as Utilities and Energy stocks see some early positive buying.

On Wall Street, markets again closed slightly up for the S&P500 and Nasdaq, which hit fresh highs. US PPI unexpectedly fell in May to 2.2% versus the consensus 2.5%.

Elon Musk’s giant $56 billion dollar payday was the biggest news in the US, with shareholders voting to both approve the pay package and Tesla’s move to Texas.

For the ASX, a continued selloff on commodities and precious metals will see many major market players finish the week down as the market struggles to find momentum.

Wall Street: S&P 500 +0.23%, Dow -0.17%, Nasdaq +0.34%.

Overseas: FTSE -0.63%, STOXX -1.97%, Nikkei -0.18%, SSE -0.28%.

The Aussie dollar -0.58% to US 66.23 cents.

US 10-year bond yields -7bps to 4.25%.

Australian 10-year bond -14bps to 4.13%.

Gold -0.69% to US$2,304.75, Silver -1.91% to US$28.99.

Bitcoin -2.11% to US$66,679, Ethereum -2.3% to US$3,468.

Oil Brent -0.68% to US$82.19, WTI Crude -0.98% to US$77.85.

Iron ore +2.1% to US$106.85 a tonne.