Lake Resources share price finally slumps after jumping 72% this week

The Lake Resources NL (ASX: LKE) share price astounded many market watchers after it rocketed 72% over the first four sessions of this week.

But the lithium stock’s green streak appears to have ended on Friday, as the company trades in the red for the first time since 3 August.

At the time of writing, the Lake Resources share price is $1.48, 7.4% lower than its previous close. However, that still sees it 60% higher than it was at the final close of last week.

In comparison, the S&P/ASX 200 Index (ASX: XJO) is also in the red today, falling 0.4% to trade 0.1% higher than it closed last week. Meanwhile, the S&P/ASX 200 Materials Index (ASX: XMJ) is down 0.04% today and has lifted 2.3% in the last five sessions.

Let’s take a closer look at what’s been going on with ASX 200 lithium share Lake Resources lately.

What was driving the Lake Resources share price this week?

This week brought a resurgence for the Lake Resources share price after a disastrous few months on the market.

The stock was caught up in June’s major lithium sell-off. It tumbled 49% that month.

Then, in July, it was hit by a short seller attack. That saw its share price fall a further 10% following a trading halt.

Following this week’s surge, the Lake Resources share price is now roughly flat with the levels it was trading at in May.

It’s also worth noting the company hasn’t been alone in the green through most of this week.

Fellow ASX 200 lithium shares Core Lithium Ltd (ASX: CXO) and Liontown Resources Limited (ASX: LTR) have both lifted around 15% since last Friday’s close.

Their gains came amid news China saw record electric vehicle (EV) sales in June – with 571,000 EVs driving away in the nation – while the United States moved to provide greater incentives for EV manufacturers.

That likely points to higher demand for EVs in the future and, as a result, higher demand (and potentially higher prices) for lithium.

Of course, signs pointing to higher lithium prices often spell good news for ASX lithium shares like Lake Resources.

The post Lake Resources share price finally slumps after jumping 72% this week appeared first on The Motley Fool Australia.

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More reading

• New records and looming deficits. Why ASX lithium stocks are in the spotlight
• Here are the top 10 ASX 200 shares today
• Here are the 3 most heavily traded ASX 200 shares on Thursday
• Why Block, Lake, Mirvac, and QBE shares are racing higher
• Why is the Lake Resources share price up so much more than other ASX lithium shares today?

Motley Fool contributor Brooke Cooper 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 Scott Phillips.

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