Why is the Novonix share price smashing the ASX 200 on Wednesday?

The Novonix Ltd (ASX: NVX) share price is outperforming the S&P/ASX 200 Index (ASX: XJO) today. Indeed, it was the index’s second-best performer earlier this morning.

The Novonix share price is currently trading at $2.13, 3.4% higher than its previous close.

For context, the ASX 200 has dumped 1.29% at the time of writing. Meanwhile, the company’s home sector – the S&P/ASX 200 Information Technology Index (ASX: XTX) – has slipped 0.07%.

So, what might be driving the battery materials and technology stock higher on Wednesday? Let’s take a look.

What’s going right for the Novonix share price?

The Novonix share price is back on the horse today despite a broader market sell-off plunging the ASX 200 to a new eight-week low.

Making the stock’s gains even more interesting is the recent poor performance of the tech-heavy Nasdaq Composite Index (NASDAQ: .IXIC). The index fell 0.7% overnight, a seventh consecutive daily loss.

As CommSec noted, that marks its longest losing streak since November 2016. The Wall Street index was fallen 8.7% over the last month.

Meanwhile, the Australian tech sector, which typically mirrors the NASDAQ, has dropped 5.2%. At the same time, the Novonix share price has plunged 32%.

That could lead some market participants to put the company’s Wednesday gains down to bargain hunting.  

The stock is joined in the green by that of Lake Resource NL (ASX: LKE) and Virgin Money UK CDI (ASX: VUK). They’ve gained 4.5% and 3.5% respectively, with the former announcing the appointment of its next CEO this morning.

Sadly, today’s gain hasn’t been nearly enough to drag the Novonix share price back into the longer-term green.

The stock has plummeted 79% year to date. It has also fallen 56% since this time last year.

For comparison, the ASX 200 is down 11% year to date and 10.5% over the last 12 months.

The post Why is the Novonix share price smashing the ASX 200 on Wednesday? appeared first on The Motley Fool Australia.

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More reading

• Slide continues: Novonix share price dumps 14% in 2 days
• Why did the Novonix share price crumble 14% in August?
• Why is the Novonix share price slumping 6% on Thursday?
• Novonix share price lifts despite full-year loss deepening to $71 million
• Here are the top 10 ASX 200 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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