The Novonix Ltd (ASX: NVX) is climbing higher on Wednesday as most ASX shares slump in early trade.
Shares in the Aussie battery materials and technology company have jumped more than 4% at the time of writing to outperform the All Ordinaries Index (ASX: XAO) today. The broad market index is down 1.56% at midday with Aussie shares getting off to a weak start.
So, why is Novonix any different to other ASX shares on Wednesday?
Why the Novonix share price is outperforming on Wednesday
For long-term investors, a one-day price trend doesn’t necessarily tell a story. However, the Novonix share price continues to climb this morning despite broad market weakness.
Today’s gains are not a once-off, however. The Novonix share price is up nearly 200% in the last 6 months and 447.6% year to date. Those are some impressive numbers that have boosted the group’s market capitalisation above $2.5 billion.
Novonix shares recently hit an all-time high on the back of strong lithium demand. Battery grade lithium carbonate prices jumped more than 20% in the Chinese domestic market in the first 2 weeks of September alone.
That means battery grade lithium prices are up more than 200% in 2021, which may help to explain the bumper performance seen in the Novonix share price. Those gains have also propelled Novonix into the S&P/ASX 300 Index (ASX: XKO), which has helped further boost its profile and coverage.
Today’s gains have continued that run despite many ASX shares slumping lower on Wednesday. This morning’s gains continue the recent trend we’ve seen amongst ASX lithium shares.
The Pilbara Minerals Ltd (ASX: PLS) share price is up more than 130% this year, while the Li-S Energy Ltd (ASX: LIS) share price soared as much as 260% above its 85 cent-per-share listing price in yesterday’s initial public offering (IPO).
Despite the market weakness today, we’re seeing gains in the Novonix share price as investors continue to hunger for Aussie lithium shares to capitalise on the current boom.
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Motley Fool contributor Ken Hall has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.
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