ASX nickel shares are struggling on the market today.
Nickel explorers in the red today include Nickel Mines Ltd (ASX: NIC), Mincor Resources NL (ASX: MCR), Panoramic Resources Ltd (ASX: PAN), and IGO Ltd (ASX: IGO). By comparison, the S&P/ASX 200 Materials Index (ASX: XMJ) is down 0.91% at the time of writing.
Let’s take a look at why nickel shares are having such a tough day on Wednesday.
Nickel outlook
The IGO share price is down 13% at the time of writing with Nickel Mines 4.12% lower. Meanwhile, Mincor Resources is down 4.69% while Panoramic Resources is 6.78% in the red.
ASX nickel shares appear to be falling in response to nickel price pressure and a note out of Goldman Sachs.
The nickel price has fallen 3% today to $28,343 per tonne, Trading Economics data shows.
But it seems the Goldman Sachs Group may have had the most impact. The broker has predicted key battery metals, including nickel, cobalt, and lithium, could drop over the next two years, Bloomberg reported.
Analysts Nick Snowdon and Aditi Rai predicted nickel will rise 20% this year before being driven down by “fundamental pressures”.
Nickel is a crucial component in electric vehicle batteries.
The analysts also expressed overall concern the battery metals bull market is over. They said:
Investors are fully aware that battery metals will play a crucial role in the 21st century global economy.
Yet despite this exponential demand profile, we see the battery metals bull market as over for now.
Nickel Mines held its annual general meeting yesterday. In a presentation titled “Building a Nickel Empire”, the company highlighted it plans to become among the top 10 nickel producers in the world.
Share price recap
While these four ASX nickel shares may be down today, overall they have surged over the past year.
Mincor shares have exploded 133% in the past 12 months while Panoramic shares have soared 67%. The Nickel Mines share price has jumped 21% and IGO shares are 44% higher.
In comparison, the S&P/ASX 200 Index (ASX: XJO) has returned around 1% in the past year.
The post Why are ASX nickel shares tumbling today? appeared first on The Motley Fool Australia.
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More reading
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