This material has been provided courtesy of BULLS N’ BEARS
The brief rally known as the "dead cat bounce" has ended, and losses resumed as the Australian Securities Exchange (ASX) fell almost 3% this week. There was no relief from discussions surrounding U.S. President Donald Trump or his trade tariffs. On Wednesday, he declared his so-called "Liberation Day" tariffs. These new duties did not follow an expected complex calculation method; instead, they targeted all countries having a trade surplus with the U.S., imposing reciprocal taxes. As part of these measures, Australia faced a basic import tariff increase of 10%, equivalent to what we apply to goods coming into Australia from the U.S. However, China along with several Southeast Asian nations heavily dependent on American markets received even higher punitive tax rates in response.
It appears that the beef sector may suffer the most in Australia. The United States is the top importer of Australian beef, with American buyers consuming $3 billion worth of high-quality products from them last year. Due to a trade embargo enacted in 2003 aimed at safeguarding the country’s livestock from the potential threat of bovine spongiform encephalopathy—commonly known as mad cow disease—Australia doesn’t import U.S. beef. This situation has been a point of contention for U.S. trade representatives for quite some time.
The frenzy seen in the US might originate from other places — yet it still appears widespread.
This week, lithium and energy stocks suffered the most significant losses, as an ongoing glut of lithium, concerns over tariffs, and OPEC increasing oil output wreaked havoc on these industries.
Australia's leading hard rock lithium producer, Pilbara Minerals, lost over 25 percent of its market capitalization for the week as analysts expressed concerns about potential underestimations in their yearly production forecasts. This comes amidst ongoing negative sentiments towards lithium.
The value of iron ore and lithium heavyweight Mineral Resources plummeted another 25% over the past week. The firm's stock price has fallen well beyond 80% from its peak levels recorded two years prior. This week brought additional challenges for both the corporation and its former billionaire leader, as their 'slightly profitable' lithium ventures edged closer to being merely sustainable. Moreover, founder Chris Ellison faced legal action from the company’s once-loyal investors through a class-action lawsuit.
The legal action alleges that Ellison engaged in misleading and deceptive behavior as part of an extensive equipment and tax exploitation scheme lasting more than ten years in the British Virgin Islands. This misconduct led to a significant drop in the company's stock value upon revelation. The leading mining corporation has seen its market capitalization plummet significantly, falling beneath the $4 billion mark. Moreover, its substantial $5 billion debt appears to be increasing considerably.
Should there be a silver lining from this week, it would be the surge in gold prices amid Trump’s tariffs and global uncertainties. The precious metal reached an unprecedented level, hitting $5050 per ounce at one point.
As expected, this week’s Bulls N’ Bears ASX Runners of the Week list has fewer highlights than usual—though some positive signs emerged amid overall losses. A leading cybersecurity firm secured the top spot by a significant margin, while an intriguing lithium company received recognition amidst general turmoil within their industry.
WHITEHAWK LTD (ASX: WHK)
increased up to 300% (from 0.8 cents to 3.2 cents)
This week’s Bulls N’ Bears ASX highlight goes to cybersecurity company WhiteHawk Limited, whose stock surged dramatically to reach an impressive peak of 3.2 cents on Wednesday—a significant jump of 300 percent from its closing value of 0.8 cents the previous week.
Following the announcement of securing a significant position as the primary cybersecurity collaborator for an extensive $920 million USD ($1474 million AUD) contract from the U.S. government, the firm's stock value skyrocketed. This deal involves prominent players such as Knexus Research, Babel Street, and Dun & Bradstreet.
WhiteHawk states that they will serve as the exclusive cybersecurity solutions provider, offering AI-driven tools to handle cyber threats within federal supply chain operations over a decade-long agreement. This partnership has the potential to generate significant ongoing income for the small-cap firm with continuous issuance of task orders.
The agreement is supported by a White House executive order from 2025 and aims to simplify governmental purchasing processes, which could create additional chances for WhiteHawk to thrive.
Given the scale of the agreement and WhiteHawk’s crucial position within it, investors seemed quick to buy shares following the news release on Tuesday morning.
WhiteHawk saw a significant trading volume of $6 million for the week, with its market capitalization eventually stabilizing just above $12 million by Friday.
WhiteHawk is providing its AI-driven solutions for managing cyber risks within the supply chain specifically for the U.S. government during an increasing worldwide focus on cybersecurity and tech advancements. The firm could secure numerous additional contracts due to being selected as a top-tier supplier for the U.S. government.
OZR Resources Ltd (ASX: OZM)
Increased by 94% (from 6.7 cents to 13 cents)
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.
On the very day when the gold price surged to an unprecedented peak, the firm released reverse circulation drilling findings from its Mulgabbie North gold venture located in Western Australia. Notable discoveries were made at their Cross Fault site, showcasing significant intersections such as 48 meters of ore yielding 1.66 grams per tonne (g/t) of gold starting right from the surface level, along with another segment measuring 12 meters averaging approximately 4.26 g/t of gold beginning at depths over 18 meters deep.
OzAurum plans to immediately initiate a subsequent drilling campaign, which includes diamond core drilling, beginning early next week. In the near term, the company aims to increase its current gold resource of 260,000 ounces throughout its project area.
The drilling campaign this week effectively verified the existence of high-quality gold mineralization across an extensive 400-meter stretch.
It seems that OzAurum has uncovered a high-quality, sandstone-hosted find characterized by gold mineralization and widespread quartz veins, along with pyrite and arsenopyrite mineralization. The company reports encountering broad areas of sulfide minerals, which suggest the possibility of substantial gold deposits.
Sandstones serve as a brittle host rock and are characteristic of the extensive gold deposits currently being extracted from the highly profitable 4-million-ounce Carasou Dam basin, located merely 2 kilometers away from Mulgabbie North.
The firm thinks its latest cross-fault prospect lies on the Relief Shear approximately 2 kilometers south of the current 260,000-ounce Mulgabbie North mineral deposit along the same fault line.
There are still seven reverse circulation holes covering 745 meters left to process in the assays. This leaves ample opportunity for shareholders eagerly awaiting gold assay results, even as the broader market remains unenthusiastic.
ARGENT BIOPHARMA LTD (ASX: RGT)
increased by 69% (from 16 cents to 27 cents)
The third-place spot on the winners' podium is claimed by biotech firm Argent BioPharma Limited as they announced their leading product, the cannabinoid-based treatment CannEpil, has received approval for prescriptions in Germany through a specific access program.
On Thursday, Argent's share price spiked, reaching as high as 27 cents—a 69 percent increase from last week's closing value of 16 cents per share. This dramatic rise occurred with only $110,000 worth of shares exchanged in an infrequently traded registry where ownership seldom shifts.
Argent’s leading CannEpil treatment features an oral solution with a high concentration of CBD and a low level of THC, designed for patients battling a type of epilepsy that does not respond well to conventional medications.
Cannabidiol (CBD) in cannabis is gaining recognition as a potential treatment for various medical issues, whereas tetrahydrocannabinol (THC) is the component known for causing psychoactive reactions.
Argint mentions that approximately 816,000 individuals in Germany receive an epilepsy diagnosis each year, and a significant number of these patients will experience a form of the condition that does not respond well to medication. The company anticipates that CannEpil could provide transformative therapy for sufferers who currently lack effective options.
By bolstering its position in Germany — a crucial pharmaceutical center — Argent has broken through a significant barrier to entering the highly prioritized European market.
As more cannabinoid-derived medications gain worldwide recognition, Argent has achieved a significant milestone with its first cannabis-based treatment being acknowledged for its uses in the central nervous system. The firm appears optimistic that this success will not remain their only triumph in this field.
Galan Lithium Ltd (ASX: GLN)
increased by 45% (from 11°C to 16°C)
This week's ASX Runners list highlights Galan Lithium, a company that stood out amidst the poor performance of the lithium sector due to its cost-effective Argentine lithium venture located within the prestigious Lithium Triangle.
The firm covertly rejected a $150 million USD ($240 million AUD) cash bid from China’s Zhejiang Huayou Cobalt Co and France’s Renault Group for its Hombre Muerto West (HMW) and Candelas lithium brine ventures in Argentina, deeming the proposition as "opportune" and "underpriced."
On Thursday morning, the rejection of the offer was concealed in an additional trading statement, where the firm’s stock price began the day without any change.
The market swiftly caught on, causing Galan’s share price to surge almost 50% to reach as high as 16 cents per share, jumping from a market capitalization of $92 million the previous week to an intra-day peak of $134 million.
This amount fell significantly below the suggested $240 million cash acquisition.
The increase went against the wider trend of declining markets.
The unexpected, conditional, and non-binding proposition put forth by battery materials heavyweight Zhejiang Huayou and electric vehicle manufacturer Renault marked the second such uninvited offer extended to Galan within less than 12 months.
In August last year, Galan was approached with an unexpected, private, preliminary, non-committal offer from Energy Exploration Technologies to purchase their Argentine properties for $100 million in cash and stock. However, the company swiftly declined this proposition.
Galan thinks that finalizing offtake and financing agreements for phase one of HMW should happen soon, which could result in a clearer and better acquisition outcome compared to the $240 million offer that was merely 2.6 times the company’s previous market value.
Galan’s HMW and Candelas projects boast a substantial 9.5 million tonne lithium carbonate equivalent (LCE) resource with a high grade of 841 milligrams per liter (mg/L). The firm has progressed beyond half the journey toward achieving phase one production.
The project lies approximately 100 kilometers south of Rio Tinto’s Rincon project, situated in Argentina’s notable Lithium Triangle. In 2022, when lithium prices were higher, this same area was purchased by the major mining company for slightly above $1 billion due to its substantial non-JORC 5.8 million tonnes of lithium carbonate equivalent (LCE) resources. Notably, Galan’s Hombre Muerto salt flat boasts lithium concentrations twice as high as those found at the Rincon site, measuring around 420 mg/L.
Galan’s choice to hold off on production for its affordable lithium venture appears perplexing; however, the leadership is determined to negotiate a favorable deal for their extensive initiative—possibly when lithium prices rise or after they quickly secure both a buyer agreement and funding.
Is your company listed on the ASX and involved in an intriguing project? Get in touch: mattbirney@bullsnbears.com.au