Current Market Analysis

Macroeconomic/ geopolitical developments Key this week Date Key Macroeconomic Events 07/10/2023 China CPI & PPI 07/11/2023 UK Unemployment and wage growth; German ZEW Economic Sentiment 07/12/2023 Reserve Bank of New Zealand monetary policy; US CPI; Bank of Canada monetary policy 07/13/2023 UK GDP (monthly); US PPI and Weekly Jobless Claims 07/14/2023 Michigan Sentiment (prelim)

The minutes of the June FOMC meeting did not tell us a huge amount that we already did not know. However, they do confirm the hawkish lean on the committee which leaves the Fed on a continued path of tightening despite the recent pause in rate hikes. The move higher seen in US Treasury yields … Continued

As US traders wearily return to their desks following their Independence Day celebrations there is a sense that consolidation is developing across USD major forex pairs. Views are becoming set that the Fed still has a likely one more rate hike to come this year before a prolonged pause. But if traders are settled in … Continued

Rainbow Rare Earths (LON: RBW) is a small cap (£50 million) London listed rare earths adventure. It looks like it’s actually going to work too, which is nice. But it’s also an excellent example of why we’re simply not going to run out of any particular metal or mineral that we’re interested in. We can … Continued

Brine, pegmatites, clay, spodumene, carbonate, hydroxide; these terms are quite simple to understand if you can spare five minutes. As an investor and analyst in battery metals, commodities, and equities, a very common question in my inbox is whether it is possible to invest directly into lithium. You can physically buy gold, silver, and copper; … Continued

The Reserve Bank of Australia (RBA) kicked off the July round of major central bank announcements with another pause in its monetary policy tightening. The guidance from the RBA suggests that there might yet be more tightening in the pipeline with data-dependent decisions to come. This topsy-turvy approach leaves AUD traders with a sense of … Continued

As we all know the lithium market – that “white gold” – is the new hot thing. So much so that we’ve microcaps like Western Yilgarn (ASX: WYX) rising 50% because people on the next property over found the right sort of rock that might have lithium in it. No, really. There’s a frenzy going … Continued

Macroeconomic/ geopolitical developments Key this week Date Key Macroeconomic Events 07/03/2023 Eurozone & UK Final Manufacturing PMI; US ISM Manufacturing, US Factory Orders 07/04/2023 Reserve Bank of Australia monetary policy; US Independence Day holiday 07/05/2023 China Caixin Services PMI; OPEC meeting; FOMC meeting minutes 07/06/2023 ADP Employment Change, US Weekly Jobless Claims, ISM Services 07/07/2023 … Continued

From Avacta to Cizzle, the UK small cap market boasts dozens of cancer-fighting shares. Read more to understand what these companies are doing to improve cancer care. As an avid analyst of high-risk, high-reward London-listed small cap shares, I tend to predominantly cover mining and biotech companies. This is to some extent a self-fulfilling prophecy; … Continued

Major currencies have seen fluctuating performance in recent months. USD performance has ebbed and flowed, with major currencies often reacting in line with swings in risk appetite. However, there is one currency that has failed to take part in these moves. That is the perennially underperforming Japanese yen. The record levels of weakness that the … Continued

Macroeconomic/ geopolitical developments Key this week Date Key Macroeconomic Events 06/26/2023 German Ifo Business Climate 06/27/2023 Canada CPI; US Durable Goods Orders, S&P/CS House Prices Index, US Consumer Confidence, US New Home Sales 06/28/2023 Australian CPI; central bank governors of the Fed, ECB, BoJ and BoE speak; 06/29/2023 US final GDP, Weekly Jobless Claims, Pending … Continued

The outlook for Gold futures has been teetering on the brink of correction in recent weeks. A hawkish-sounding Fed Chair Powell may have tipped the balance for a continued correction in the yellow metal. However, the big question is whether markets believe him. Fed Chair Powell sounds hawkish Last week’s FOMC decision for a “hawkish … Continued

With CPI inflation stubbornly high, Governor Andrew Bailey must choose the path of least damage. A recession is imminent. The Bank of England has two official objectives in its monetary policy remit: It has two key tools to perform its duties — setting the base rate and controlling the money supply. While it usually takes … Continued

It was not meant to be like this. Inflation in other countries is falling, but not in the UK. Once more, the CPI data from the Office of National Statistics has come in hot. UK CPI has come in much higher than expected as headline inflation did not fall, whilst core inflation increased sharply. The … Continued

The Australian dollar (AUD) has been one of the standout performers on major forex in recent weeks. However, it may now be time for a bit of a retracement. Profit-taking is setting in this morning as a double whammy of factors hit the AUD. A rate cut from the People’s Bank of China (PBoC) and … Continued

Macroeconomic/ geopolitical developments Global financial market developments Key this week Date Key Macroeconomic Events 19/06/2023 US public holiday (for Juneteenth) 20/06/2023 US Building Permits and Housing Starts 21/06/2023 UK CPI; Canadian Retail Sales; Jerome Powell Congressional testimony (House Financial Services Committee) 22/06/2023 Swiss National Bank monetary policy; Bank of England monetary policy; US Weekly Jobless … Continued

The Bank of Canada paused its rate hiking cycle in January but then hiked rates at its last meeting. The Royal Bank of Australia paused in April but then had to start hiking again in June. The Fed also paused at its June meeting or at least skipped a rate hike. This was the case … Continued

After being much touted in the previous meeting and successive hawkish rhetoric from ECB President Lagarde in recent weeks, the ECB has hiked its rates corridor by 25 basis points. That much was expected. However, this is still being seen as a hawkish hike amid a sharp increase in inflation projections. If this runs true, … Continued

Inflation continues to fall in the US. The CPI for May has shown that as the sharp jump in price over the first half of 2022 continues to drop out of the data, inflation is decisively falling. This disinflationary path leaves me questioning the Fed’s next move after the pause in the FOMC hikes in … Continued

UK economic growth is pretty anaemic. Headline inflation has only just dropped below double digits. Some would arguably point to the economy going through a period of stagflation. Despite this, the performance of GBP continues to stand up strongly against other major currencies. The Bank of England is having to prioritise inflation reduction in its … Continued

International Airline Group’s (LON:IAG) – or as we all still call it, BA – next results come out on 28th July. We’ve just had their Q1 results here. Things are obviously getting better, the recovery from Lockdown is happening. But what we really want to know is how far is that comeback going to go. … Continued

Macroeconomic/ geopolitical developments Global financial market developments Key this week Date Key Macroeconomic Events 12/06/2023 N/A 13/06/2023 UK Unemployment and wage growth; German ZEW Economic Sentiment; US CPI 14/06/2023 UK monthly GDP; US PPI and Federal Reserve monetary policy 15/06/2023 Australian Unemployment; Chinese Industrial Production & Retail Sales; European Central Bank monetary policy; US Retail … Continued

With five major central banks giving monetary policy decisions in the first half of June, this is a period that could shape the outlook of forex markets for the weeks to come. There is a key theme that is emerging, with hawkish surprises coming from both the Reserve Bank of Australia and the Bank of … Continued

US equity markets have broken out to multi-month highs. The reasons to not be positive (or perhaps even outright bearish) are still prevalent. Yet, investors still seem happy to climb a wall of worry. Since October, the S&P 500 futures have rallied from a shade above 3500 to hit levels above 4300 this week. However, … Continued

Bidstack’s share price no longer comes close to representing the fundamentals. But investors will need patience. I last covered Bidstack (LON: BIDS) in mid-December 2022, hailing the video game advertising company as ‘one of the best undervalued tech stock opportunities to consider in 2023.’ As neither a mining company nor a biotech, BIDS is one … Continued

Gold has been corrective over the past month. This has come as the US dollar (USD) and US Treasury yields have rebounded. The two big factors that are historically so crucial the near to medium-term outlook for gold remain the key drivers right now. Subsequently, with the USD rally starting to falter, the corrective move … Continued

C3.ai (NYSE.AI) and Nvidia (NASDAQ: NVDA) are the two major stocks that people are using to bet on the AI revolution. As Paul Graham points out, this might not be the best set of possibilities: “AI is the first big new wave of technology we’ve had since start-ups started going public much later. The result … Continued

Macroeconomic/ geopolitical developments Global financial market developments Key this week Date Key Macroeconomic Events 05/06/2023 S&P Global Services PMI global data and from US ISM Services PMI, US Factory Orders 06/06/2023 Reserve Bank of Australia monetary policy 07/06/2023 Australian GDP; China Trade Balance; Bank of Canada monetary policy 08/06/2023 US Weekly Jobless Claims 09/06/2023 China … Continued

Darktrace (LON: DARK) has long had a rather fragile share price. In part this is simply because it’s something of a hot, go-go, stock and therefore any contrary news hits the price hard. When prices are based on dreams and assumptions about the future then anything that deflates the balloon hits hard. As we’ve noted … Continued

Eurozone inflation was lower than forecast in May. Core inflation fell to 5.3% in a move that saw two consecutive months of declines for the first time since mid-2021. With GDP faltering this will mean that the ECB will be more cautious in hiking rates aggressively from here. This is likely to weigh on the … Continued

Premier African Minerals has achieved something that few thought possible – brought a patch of bush into lithium concentrate production in under 8 months. That really is remarkable and they have indeed achieved that at the Zulu Project in Zimbabwe. They’ve also got a horrible, horrible, financial problem here. It is about, vaguely, possible that … Continued

Macroeconomic/ geopolitical developments Global financial market developments Key this week Date Key Macroeconomic Events 29/05/2023 US Memorial Day and UK Spring bank Holiday, markets closed 30/05/2023 Eurozone Sentiment; US Consumer Confidence, Dallas Fed Manufacturing Index 31/05/2023 Japanese Retail Sales and Industrial Production; Chinese PMIs (official); German inflation; Canadian GDP; US JOLTS jobs openings 01/06/2023 Final … Continued

The AIM index has always been a poor performer. It’s the star players you need to keep an eye on. As a long-term investor in small cap FTSE AIM shares, I would say that sentiment on the UK’s growth index feels a tad negative. Maybe it’s just me? The index is down 17.3% over the … Continued

The Bank of England (BoE) is facing an ongoing battle against inflation. Despite interest rates having been aggressively hiked to 4.50% as headline inflation reached double digits, there is more work to be done. Today’s announcement of inflation for April suggests that the work could be considerable. The likely need for further rate hikes (yes, … Continued

PREM is just the latest example of why it’s so essential to read the details. Premier African Minerals (LON: PREM) pulled a little trick last week that should be used as the poster child for why we should always, but always, read the details. PREM had a rights issue. Well, nothing wrong in that, they’re … Continued

Gold has been a consistently solid investment over recent months. However, the shine is beginning to be taken off the performance. The drivers that have allowed gold to outperform other metals (that are deemed to be a higher risk) are starting to dissipate. This is leading to a retreat which could drag the gold price … Continued

MNK was up 435% on Friday – this is option-like price movement. Mallinckrodt (NYSEAmerican: MNK) jumped 435% on Friday. Which is the sort of price behaviour we expect from options, not from major corporations. The reason for the volatility – not for the price movement, the volatility – is that in effect MNK stock is … Continued

Oil rebounded yesterday as traders have taken progress in the talks over the US debt ceiling as a positive for market sentiment. This near-term boost may still have legs to run, but the path to sustainable upside looks restricted. There is a whole catalogue of mixed signals impacting the oil price right now, but for … Continued

The mechanics, the politics, McCarthy, and why it really is different this time. Every so often, the prospect of a US default rears its ugly head. The common wisdom is that the government will always push through some kind of ‘fudge,’ an unhappy middle ground that keeps the can kicking down the road. And usually, … Continued

This has been a tough period for metals prices in the commodities sector. As so often has been the case, there is a key link between the performance of the USD and that of metals prices. However, with risk appetite and the USD playing a role, this is also meaning that there is a safe … Continued

Macroeconomic/ geopolitical developments Global financial market developments Key this week Date Key Macroeconomic Events 15/05/2023 Eurozone Industrial Production 16/05/2023 Chinese Industrial Production & Retail Sales; UK Unemployment; Eurozone Trade Balance; Eurozone GDP (2nd); German ZEW Economic Sentiment; Canadian Inflation; US Retail Sales & Industrial Production 17/05/2023 Japanese GDP (Q1 prelim) & Industrial Production; Eurozone HICP … Continued

The oil price has been swung around like a rag doll in the past couple of months. The focus on supply factors has been shoved aside as traders have fretted over the outlook for oil demand. Concerns over an impending recession in the US have dominated the narrative. However, this may have become overdone for … Continued

Atlas Lithium (NASDAQ: ATLX) could be one of those rare and truly grand investing opportunities in the junior mining space. Someone does, after all, have to find the motherlode sometimes otherwise where would the very phrase come from? One the other hand it’s possible – as some allege – that Atlas Lithium is an over-hyped … Continued

Equity markets had a strong run higher in March and April. However, moving into May the rallies are looking tired. Macro factors are starting to weigh on sentiment ahead of crucial monetary policy announcements from the Federal Reserve and the European Central Bank. Sentiment is threatening to sour and this could mean a period of … Continued

Copper demand will skyrocket this decade. Supply is falling, and inventories are at near-record lows. For the long-term investor, it’s merely a waiting game. In early November 2022, I wrote up an article covering the growing consensus surrounding the emerging copper supply gap. Simply put, copper demand is growing exponentially, and supply is drying up. … Continued

Things do sometimes go wrong, as WANdisco (LON: WAND) and Alphawave (LON: AWE) have just shown – with an able little assist from Altyngold (LON: ALTN). More specifically things sometimes go wrong with the accounting within a company. As is the case with all three of these. However, sometimes – just the sometimes – there’s … Continued

First Quarter GDP increased at only a 1.1% seasonally adjusted annual rate. That was down from 2.6% in Q4 of last year, which was down from 3.2% during Q3. Despite the clear slowdown in economic growth, there still exists a battle between Wall Street’s soft-landing narrative, where inflation comes down in the context of robust … Continued

A near-term correction is building on gold. Since peaking at $2039 in mid-April, the gold price has been pulled lower. It is currently trading around three-week lows, with cash gold trading decisively back below the psychological $2000 level.   However, this looks to be a near-term move that is likely to be the source of … Continued

Atlantic Lithium (LON: ALL) is one of those shares that justify the AIM market in London, or the similar parts of the TSE and Vancouver exchanges. There needs to be somewhere that junior (ie, not yet producing) miners can go get the necessary capital. Someone, somewhere, has to pay for the exploration and proving work … Continued

CXApp (NASDAQ: CXAI) was quite the exciting stock last week, jumping from $1.33 to, at one point intraday, $50 or so. It fell off from that, obviously enough. Quite why the massive excitement no one is really quite sure. A recent Spac deal it does something with AI and perhaps that’s enough to get the … Continued

The former Soviet state is toeing a delicate line between Russian politics, Chinese protections, and European energy concerns. Uranium is in many ways like lithium. It’s non-fungible, very reactive, and for many years was unprofitable to mine out of the ground. But with nuclear power becoming much more acceptable as a ‘green energy’ source, and … Continued

Macroeconomic/ geopolitical developments Global financial market developments Key this week Date Key Macroeconomic Events 10/04/23 Easter Monday holiday, UK and European markets are closed; Fed’s Williams speaks 11/04/23 China CPI; EU Retail Sales; Fed’s Harker speaks 12/04/23 Fed’s Kashkari speaks; US CPI; BoC interest rate decision and statement; FOMC Minutes released 13/04/23 Australian Employment report; … Continued

OPEC has played this particular gambit before. It didn’t work then, and it won’t work now. Brent Crude — the North Sea oil benchmark — traded for an average of circa $70 per barrel in 2021, $42 in 2020 (when oil went negative for the first time ever), and $64 in 2019. BP CEO Bernard … Continued

Inflation, Sino-Western tensions, falling ore quality and excess plant capacity are all creating a flourishing mergers and acquisitions environment. As an investor in multiple LSE-listed mining small caps, and an analyst of the larger titans, I have a fairly wide view of the mining industry. And the key thing I keep coming back to is … Continued