Category: Stock Market

The Global Lithium Resources Ltd (ASX: GL1) share price is heading south on Tuesday despite the company providing its latest drilling results.

Currently, the lithium explorer’s share price is down 1.22% to $2.42 after spending the morning in positive territory.

At one point, the share price rose to as high as $2.54 before profit takers swooped in.

Let’s take a closer look at what the Western Australia-based lithium company announced and why its shares are falling.

Global Lithium returns significant lithium assay results

In its release, Global Lithium announced that it has received the highest-ever grade of a lithium-bearing pegmatite from the Manna Lithium Project.

It is the first diamond core drilling program at the site which is located 100 kilometres east of Kalgoorlie in Western Australia.

Global Lithium highlighted the assay results:

• 5.7 metres @ 1.82% lithium oxide (Li2O) from 136.7 metres
• 3.9 metres @ 1.72% Li2O from 148.9 metres
• 6.8 metres @ 1.65% Li2O from 160.3 metres
• 6.8 metres @ 1.49% Li2O from 313.2 metres

In addition, a second reverse circulation (RC) rig has now commenced drilling at the Manna Lithium Project.

Once the drilling program and metallurgical test work is complete, Global Lithium will update the mineral resource estimate (MRE). This is expected to occur around the fourth quarter of 2022.

At present, the Manna Lithium Project hosts a maiden inferred mineral resource of 9.9Mt @ 1.14% Li2O.

Commenting on the results, Global Lithium general manager of exploration Stuart Peterson said:

It is very encouraging to see such high grade spodumene zones within the pegmatites at the Manna Lithium Project. This result shows that the spodumene crystal growth was complete during the pegmatites formation and having these clean, high grade spodumene intervals within the pegmatites should provide a clear metallurgical upgrade pathway to produce a saleable lithium concentrate.

So why is the Global Lithium share price tumbling?

Investors are selling down the Global Lithium share price today after surging more than 50% in the past week.

A key indicator, the relative strength index (RSI), touched 81 as sellers began to swing into action.

The RSI is a momentum oscillator that is used to assess the strength or weakness of a share price. Normal levels range between 30 and 70, but anything outside this tells us if the share price is cheap or expensive.

Furthermore, the share price was drifting outside the Bollinger Bands. This works well in conjunction with the RSI, which signals if a share is oversold or overbought.

Despite today’s decline, the Global Lithium share price has risen 160% in 2022, and is up an astonishing 525% over the past 12 months.

The post Global Lithium share price backtracks despite ‘highest ever grade’ discovery appeared first on The Motley Fool Australia.

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More reading

• 2 ASX lithium shares leaping more than 9% on Monday
• Why is the Global Lithium Resources share price rocketing 27% this week?
• 3 little-known ASX lithium shares that rocketed today
• Global Lithium shares edged higher today amid ‘very promising’ results
• Why are ASX lithium shares having such a cracking start to the week?

Motley Fool contributor Aaron Teboneras 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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The S&P/ASX 200 Materials Index (ASX: XMJ) is up 0.89% Tuesday, but three ASX mining shares are lifting much higher.

Critical Resources Ltd (ASX: CRR), Rafaella Resources Ltd (ASX: RFR), and Recharge Metals Ltd (ASX: REC) shares are all soaring today.

So why are these ASX mineral explorer shares having such a great day today?

Critical Resources

The Critical Resources share price is surging 34% at the time of writing. The lithium explorer provided an update on the Mavis Lake Lithium Project in Ontario, Canada. Assay results delivered “the highest grade lithium results” in the project’s history. The company said the results confirmed “thick, high-grade intercepts” with up to 4.32% lithium oxide. Commenting on the news, chairman Robert Martin said:

To receive such exceptional assays results and for them to contain the company’s highest
grading results of lithium mineralization ever to be intersected at Mavis Lake is absolutely
outstanding.

Rafaella Resources

This ASX mining share is soaring nearly 37% today. It comes amid news Rafaella will acquire the Horden Lake battery metals project in Quebec, Canada for C$4 million (AU$4.485). The company has secured financing for $2 million and other “significant” late-stage discussions are continuing around funding. Rafaella has paid C$400,000 already from existing cash.

Commenting on the news, managing director Steven Turner said:

The acquisition of the Horden Lake deposit will be, once completed, truly and immediately transformative for the company.

Recharge Metals

The Recharge Metals share price also soared 20% in earlier trade before pulling back. The company’s share price is currently rising nearly 3%. Recharge announced “encouraging” results from drilling at the Brandy Hill South project in Western Australia. Drilling intercepted with broad zones of nickel and cobalt mineralisation, along with silver and multiple intercepts of copper.

Commenting on the results, managing director Brett Wallace said:

We are very excited to report not only multiple zones of copper mineralisation and broad
zones of silver intercepts, but thick, shallow intercepts of nickel and cobalt mineralisation from
the two remaining diamond holes.

The post 3 ASX mining shares leaping more than 20% on battery minerals news appeared first on The Motley Fool Australia.

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More reading

• Broker tips 100% upside for Lake Resources share price
• The ASX 200 rare earths mining share this fundie is watching like a hawk. (Hint: not Lynas)
• Why this top broker is tipping 14% upside for the Wesfarmers share price
• Runaway train? Pilbara Minerals share price leaps to yet another all-time high
• Why Bitcoin and Solana jumped on Monday

Motley Fool contributor Monica O’Shea 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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The Lake Resources N.L. (ASX: LKE) share price is pushing higher on Tuesday afternoon.

At the time of writing, the lithium developer’s shares are up almost 3% to $1.29.

This means the Lake Resources share price is now up 19% since the start of the year.

Where next for the Lake Resources share price?

While opinion is fiercely divided on this heavily shorted lithium share, one top broker that is sitting well and truly on the bull side of the fence is Bell Potter.

According to a note released this morning, the broker has retained its speculative buy rating with a trimmed price target of $2.54.

Based on the latest Lake Resources share price, this implies a potential return of almost 100% for investors over the next 12 months.

What did the broker say?

Bell Potter notes that Lake Resources is currently transitioning into project development and has appointed a new CEO to lead the charge. It said:

LKE’s near-term outlook centres on delivery of the Kachi project definitive feasibility study, demonstrating larger scale success of the ion exchange direct lithium extraction technology which the project will employ, and ultimately coordinating binding lithium offtake and debt financing arrangements. The March 2021 prefeasibility study pointed to 25ktpa lithium carbonate production at a capital cost of US$544m; the DFS is now assessing a project with 50ktpa production. LKE has sufficient funds to take Kachi to development with cash at 30 June 2022 of $175m at 30 June 2022. A new Managing Director has been appointed to transition the company into development.

However, given the doubts over the company’s direct lithium extraction technology, the broker acknowledges that demonstrating that it works will be very important in the near future. As this is not guaranteed, it explains why Bell Potter’s buy rating has a speculative warning.

The broker commented:

LKE’s Kachi lithium project in Argentina is strategic in terms of scale, applied technology and uncommitted product offtake. Demonstrating the feasibility of ion exchange lithium extraction is key to de-risking the project; success will disrupt traditional lithium brine production. The technology also brings significant ESG benefits including less land disturbance and water consumption. […] LKE is an asset development company with prospective operations and cash flows. Our Speculative risk rating recognises this higher level of risk and volatility of returns.

The post Broker tips 100% upside for Lake Resources share price appeared first on The Motley Fool Australia.

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More reading

• Here are the 10 most shorted ASX shares
• Here are the 3 most heavily traded ASX 200 shares on Friday
• Why are Lake Resources shares among the most shorted on the ASX?
• Here are the top 10 ASX 200 shares today
• Here are the 3 most heavily traded ASX 200 shares on Thursday

Motley Fool contributor James Mickleboro 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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When you think of S&P/ASX 200 Index (ASX: XJO) rare earths mining shares, Lynas Rare Earths Ltd (ASX: LYC) may be the first to spring to mind. It’s certainly dominant in the field with a market cap of $8 billion.

But in Perennial Partners’ August 2022 report, the ASX 200 rare earths miner under the spotlight isn’t Lynas. It’s the somewhat smaller Iluka Resources Ltd (ASX: ILU) which has a market cap of $4.3 billion.

This ASX 200 miner fits the bill

Perennial expects to see more merger and acquisition (M&A) activity in the resources sector “as people scramble to secure supply of critical minerals, with particular focus on those located in stable, well-regulated and geopolitically friendly regions”.

Perennial said ASX 200 miner Iluka, one of its holdings, “fits this bill”.

According to Perennial:

Iluka, which delivered a strong result on the back of high mineral sands prices, is currently developing a rare earths refining facility in Western Australia. The facility, which is predominantly funded by a $1 billion non-recourse loan from the Australian Government’s Critical Minerals Facility, will process rare earths for Iluka and other miners.

Rare earths are strategically important, being used in a range of advanced electronics applications as well as being critical to electrification, where they are used to produce very strong magnets.

Perennial added, “Currently, the majority of the world’s supply of rare earths come from China, which presents obvious risks.”

Below is quick recap of how the ASX 200 rare earths miner has been performing.

Iluka performance snapshot

The Iluka share price has outperformed in what’s broadly been a difficult year in the markets, gaining 4% in 2022 compared to the 8.7% loss posted by the ASX 200.

As the Perennial report mentioned, Iluka has benefited from high mineral sands prices. This saw a 186% increase in its net profit after tax (NPAT) in H122 to $369 million. The miner also more than doubled its interim fully franked dividend to 25 cents per share.

At the current share price, the ASX 200 rare earths miner pays a 3.7% trailing dividend yield.

The post The ASX 200 rare earths mining share this fundie is watching like a hawk. (Hint: not Lynas) appeared first on The Motley Fool Australia.

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More reading

• These ASX 200 shares are going ex-dividend on Monday
• 5 ASX shares that could rocket from a rare earths crisis: expert
• Guess which ASX 200 share just upped its dividend by 108%
• These three ASX 200 shares rocketed higher on earnings updates today
• Why Domino’s, Iluka, Netwealth, and WiseTech shares are storming higher

Motley Fool contributor Bernd Struben 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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It’s been a solid start for the S&P/ASX 200 Index (ASX: XJO) so far this Tuesday. At the time of writing, the ASX 200 has added a healthy 0.54% and is now over 7,000 points. But let’s talk about the Wesfarmers Ltd (ASX: WES) share price.

Wesfarmers shares are having an even better time than the overall market over this session thus far. The ASX 200 industrial and retail conglomerate has added a pleasing 1.41% so far today to $48.495 a share.

Saying that, the Wesfarmers share price has still been a bit of a laggard in recent months. The company remains down a painful 18% or so over 2022 thus far. That doesn’t compare too well with the ASX 200’s loss of 6% year to date. The company also remains down 15% over the past 12 months.

So what might be next for Wesfarmers shares as we stand here in September 2022?

Well, let’s discuss what one ASX broker reckons.

Is the Wesfarmers share price a buy today?

ASX broker Morgans is indeed calling Wesfarmers a buy today. As my Fool colleague James covered on the weekend, the broker has a buy rating on the company at present, complete with a 12-month share price target of $55.60. That target implies a potential upside of around 14.4% over the coming year.

Morgans describes Wesfarmers as having “one of the highest quality retail portfolios in Australia with strong brands including Bunnings, Kmart and Wesfarmers Consumer Officeworks”.

Here’s some of what the broker said on its buy rating:

The company is run by a highly regarded management team and the balance sheet is healthy. While COVID-related staff shortages are proving to be a challenge, the core Bunnings division (>60% of group EBIT) remains a solid performer as consumers continue to invest in their homes.

We see the pullback in the share price as a good entry point for longer term investors.

In terms of dividends, Morgans is also anticipating some big things. The broker has pencilled in fully franked dividends of $1.82 per share for FY23 and $1.89 for FY24. That compares to the $1.80 the company will shell out for FY22.

So no doubt that would all be very welcome news for Wesfarmers shareholders. But we’ll have to see what happens.

At the current Wesfarmers share price, this ASX 200 retail share has a market capitalisation of $54.99 billion, with a dividend yield of 3.51%.

The post Why this top broker is tipping 14% upside for the Wesfarmers share price appeared first on The Motley Fool Australia.

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More reading

• How I’d invest $10,000 in ASX shares if I were saving for a house
• Brokers rate these ASX dividend shares as buys
• Buying Wesfarmers shares? Here’s why the company says Bunnings can continue to outperform
• Could these ‘little’ businesses be a secret weapon for Wesfarmers shares?
• Are ‘cracks starting to show’ for ASX 200 retail shares?

Motley Fool contributor Sebastian Bowen has positions in Wesfarmers. 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 positions in and has recommended Wesfarmers Limited. 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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What can stop the Pilbara Minerals Ltd (ASX: PLS) share price?

That might be the question on many investors’ lips today. The Pilbara share price continues to rip higher into record territory. The ASX 200 lithium share has hit yet another all-time high this Tuesday, the latest in what is becoming a long line.

Today, Pilbara shares are presently trading for $4.78 each, up a very robust 4.7% at present. That is right on the company’s new high watermark. If we backtrack just a month, we’ll find the Pilbara share price at a far lower $3.23.

This means the company has gained a rather extraordinary 48% over just the past month alone. Pilbara shares are now up 36% year to date and a whopping 117.5% over the past 12 months.

Runaway train could be an apt description.

So what’s going on here?

Why does the Pilbara share price keep shooting the lights out with new record highs?

Well, it appears this move reflects what has become a very optimistic trend amongst ASX investors on the future of lithium.

On the weekend, my Fool colleague James covered a sunny outlook on Pilbara shares from broker Macquarie. Macquarie has an outperform rating on Pilbara shares right now, with a 12-month share price target of $5.60. 

Just yesterday, we also looked at another broker’s optimism regarding the lithium price itself. Barranjoey reckons the price of lithium could surge by up to 86% over the next two years, thanks to tight supplies of the future-facing metal.

The broker has reportedly raised its earnings per share (EPS) estimates for Pilbara by up to 44% for FY23 and up to 120% for FY24. 

Perhaps there’s a bit of good old-fashioned ‘fear of missing out’ going on with the Pilbara share price as well, judging by the steep rise in the company’s shares over such a short space of time.

Whatever the reasons, it has certainly been a month to remember for Pilbara shares–  and investors.

At the current Pilbara Minerals share price, this ASX 200 lithium share has a market capitalisation of $14.23 billion.

The post Runaway train? Pilbara Minerals share price leaps to yet another all-time high appeared first on The Motley Fool Australia.

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More reading

• With most investors thinking the next big move in the stock market is down, Warren Buffett says times like these are your friend
• ASX lithium stocks are ‘the buy now, pay later of 2022’: expert
• Here’s the lithium price forecast through to 2024
• Here are the 3 most heavily traded ASX 200 shares on Monday
• Top broker tips lithium price to surge 86% over next 2 years

Motley Fool contributor Sebastian Bowen 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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This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

What happened 

The crypto market was up sharply on Monday morning as investors turned bullish once again on riskier assets. The S&P 500 is up about 0.9% and the Nasdaq Composite is up 1% as of this writing, which often correlates with rising crypto prices. 

At 11:30 a.m. ET, Bitcoin (CRYPTO: BTC) was up 3.4% in the last 24 hours, Solana (CRYPTO: SOL) was up 7.9%, and Near Protocol (CRYPTO: NEAR) jumped 6.3% today. On the flip side, TerraClassicUSD (CRYPTO: USTC) is down 13.8% following a big jump last week.  

So what 

A rising stock market certainly helps cryptocurrency values. Investors are currently bidding up stocks on speculation that August inflation data won’t be as bad as feared. Inflation and high energy prices have both hurt the economy and caused the Federal Reserve to increase interest rates over the past year. If that trend reverses, it could be bullish for stocks and cryptocurrencies.

Founder Michael Saylor’s MicroStrategy said today it would sell as much as $500 million in stock to buy more Bitcoin. Saylor continues to be the most consistent Bitcoin bull in the market and seems to be willing to risk the company’s future on the cryptocurrency. But for Bitcoin itself, the buying would be incrementally positive for the market. 

TerraClassicUSD is the other big mover, but it’s moving lower. The legacy “stablecoin” from the Terra ecosystem saw speculative buying last week, but that rally is fading. With very little fundamental reason to keep the cryptocurrency moving higher, this isn’t one I would be taking any position in because it’s just a trading mechanism at this point.

Now what 

If inflation is indeed coming under control that would be a good thing for all riskier assets, whether you’re looking at growth stocks or crypto. The risk was that high inflation would force the Federal Reserve to raise interest rates dramatically, which could hurt cryptocurrencies because they would be competing against higher yields for low-risk bonds from the U.S. government. And higher interest rates would likely hurt economic growth and investment in start-ups, which is why crypto investors aren’t fond of higher rates. 

As much as macro factors are playing into the crypto market right now, what I think investors need to keep in mind is the innovation happening right now. A blockchain like Solana is seeing rapid innovation in everything from decentralized finance to non-fungible tokens and software-as-a-service business models. As these products become more usable, they’re gaining adoption across the business world. 

I’m still bullish on crypto long-term, but think investors should focus on cryptocurrencies like Solana and Near Protocol that have a path toward innovative utility in the digital world. They’re likely to be the places where developers create the next phase of disruptive technology and that’s why I’m excited about the industry. 

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

The post Why Bitcoin and Solana jumped on Monday appeared first on The Motley Fool Australia.

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More reading

• Can the Bitcoin price reach US$1 million?
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• Why Bitcoin, Ethereum, and Solana were up Thursday morning
• The Ethereum price just dropped 8% despite Merge progression
• The Bitcoin price just fell below US$19,000 What’s happening?

Travis Hoium has positions in Solana. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Bitcoin and Solana. The Motley Fool Australia owns and has recommended Bitcoin and Solana. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

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The Whitehaven Coal Ltd (ASX: WHC) share price is red this afternoon, despite gains observed in the broader market.

Shares of the coal producer are currently down 2.5% at $2.385 apiece. Meantime, the S&P/ASX 200 Energy Index (ASX: XEJ) is 1.49% higher at the time of writing while the S&P/ASX 200 Index (ASX: XJO) is up 0.59%.

Similarly, other ASX coal shares are outperforming the Whitehaven Coal share price so far today.

Shares in New Hope Corporation Limited (ASX: NHC) are up 0.55% while Coronado Global Resources Inc (ASX: CRN) is trading 2.54% higher.

There are no announcements from the company today to make sense of the selloff in Whitehaven’s share price, but some developments have unfolded for the energy market in general. Let’s cover those highlights.

Share prices fall amid energy crisis

Reuters reported this morning that energy companies in the EU, such as coal producers, could be required to make ‘a solidarity contribution’ to help offset the effects of the continent’s ongoing energy crisis.

Under the proposal, companies would be required to pay out part of their taxable profits made in FY22. These funds would then be used to help subsidise rising energy costs and, ultimately, help Europe to be less dependent on Russia for its energy supply.

As reported by Bloomberg this morning, the energy market is also being hit from another angle as the price of natural gas falls to lower levels. Natural gas futures were said to have fallen 9.3% amid the challenges in the EU.

The price of coal is also down today with coal trading 2.94% lower, according to Markets Insider. The current price is $US330 per tonne.

Whitehaven Coal share price snapshot

Despite today’s drop, the Whitehaven Coal share price has gained an incredible 222% so far this year.

It far outstrips the ASX 200’s 6% loss over the same period.

The company’s current market capitalisation is around $8 billion.

The post Why is the Whitehaven share price lagging behind the ASX 200 on Tuesday? appeared first on The Motley Fool Australia.

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More reading

• Why is the Whitehaven share price lagging the ASX 200 on Monday?
• Here’s why ASX 200 energy shares are diving lower today
• Why Karoon Energy, Pilbara Minerals, PointsBet, and Whitehaven Coal are rising
• How are ASX 200 energy stocks performing on Tuesday?
• Whitehaven share price surges to yet another all-time high, here’s why

Motley Fool contributor Matthew Farley 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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As the old saying goes, the stock market climbs a wall of worry.

Overnight, the S&P 500 Index (SP: .INX) extended last week’s rally, bringing up its biggest four-day gain since June. The Apple (NASDAQ: AAPL) share price gained almost 4% on positive pre-order data for the new iPhone 14. Not bad for a company already valued at US$2.63 trillion.

Here in Australia, the S&P/ASX 200 Index (ASX: XJO) has also had a nice little run, re-taking the 7,000 level in early Tuesday trading, also on track for its fourth day of gains in a row. 

Mining stocks like Mineral Resources Limited (ASX: MIN) and Pilbara Minerals Ltd (ASX: PLS) have been notable gainers as lithium stocks show no signs of losing their popularity, while busted tech stocks Megaport Ltd (ASX: MP1) and Life360 Inc (ASX: 360) have caught a bid too.

Yet, investor wariness remains, according to a new survey from Deutsche Bank.  

As reported on MarketWatch, when asked what the S&P 500’s next move would be, 74% of respondents said 3,300 – a roughly 18% drop from Friday’s close of 4,067.

In addition, fewer than 10% of those surveyed believe the stock market has bottomed, with 33% saying the market will hit its lows for this cycle before the end of 2022.

What does all this tell us?

1. Four up days for the market neither signifies the start of a new bull market, nor is it in any way meaningful over the only investing term that matters – at least five years, and ideally decades.
2. Investors extrapolate the recent past into the future, both on the downside, and the upside. 

We’ve recently been through an almighty bubble in a number of asset classes, including buy now, pay later stocks, unprofitable tech stocks, NFTs and crypto. In hindsight, it’s now obvious. At the time, it’s easy to assume the party never ends. 

Now, having lived through a brutal stock market correction, caused by an inflation shock and rapidly rising interest rates, we assume there’s more pain ahead.

Today, traders are on tenterhooks awaiting the latest US inflation print, released at 10:30pm AEST tonight.

Expectations are for US inflation to have come down from the 8.5% print in July, with economists predicting the August reading to be 8%.

At this stage, it’s a guessing game, both as to what the inflation number might be and how the stock market might react.

Scenario #1: Lower inflation than expected, and the market rips higher because the Federal Reserve won’t have to raise interest rates as rapidly as it has in the recent past.

Scenario #2: Higher inflation than expected, and US markets fall out of bed, with the ASX 200 to follow suit tomorrow morning.

Scenario #3: After an initial rise or fall based on the August inflation numbers, the market settles back down and focuses on the likely medium-term economic outcome, that being a mild US recession.

What should investors do now?

Keep buying stocks. Keep regularly putting money to work, ideally each month, like clockwork. Invest more money into your favourite holdings, and/or into a broad-based ETF, like my favourite, the Vanguard MSCI Index International Shares ETF (ASX: VGS). 

Aussie fund manager reports are trickling out for August, with most saying the recent reporting season was generally better than many had anticipated.

The team at 1851 Emerging Companies Fund said last month it conducted over 200 meetings with listed companies, where many cited no evidence of a slowdown within their respective businesses. 

The Eley Griffiths Group Emerging Companies Fund said management outlook statements suggested that the consumer is still spending with no sign of slowdown yet.

Amid all the angst caused by rising interest rates and the ASX 200 index having fallen 8% from its recent peak, it’s worth remembering that at 3.5%, the Australian unemployment rate is at its lowest in almost 50 years. It’s hardly the stuff of recession.

That said, labour shortages have the effect of pushing up wages, which in turn further fuels inflation, which means the RBA will have to keep hiking interest rates. And if we’ve learnt anything in the past 12 months, it’s that the market, and particularly highly-rated growth stocks, hates even higher interest rates.

Throw all the above into a blender and you get uncertainty, in the short term. It’s why investor wariness remains. 

In the words of investing legend Warren Buffett, “you pay a very high price in the stock market for a cheery consensus. Uncertainty actually is the friend of the buyer of long-term values.”

Befriend the stock market and its volatility. Keep buying. Keep holding, for the long-term, the only term that matters for investors.

The post With most investors thinking the next big move in the stock market is down, Warren Buffett says times like these are your friend appeared first on The Motley Fool Australia.

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More reading

• ASX lithium stocks are ‘the buy now, pay later of 2022’: expert
• Here’s the lithium price forecast through to 2024
• Lithium spin-off? UBS tips 80% upside for Mineral Resources share price
• Why Apple stock popped on Monday
• Here are the 3 most heavily traded ASX 200 shares on Monday

Motley Fool contributor Bruce Jackson has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Apple, Life360, Inc., MEGAPORT FPO, and Vanguard MSCI Index International Shares ETF. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended the following options: long March 2023 $120 calls on Apple and short March 2023 $130 calls on Apple. The Motley Fool Australia has recommended Apple, MEGAPORT FPO, and Vanguard MSCI Index International Shares ETF. 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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The Allkem Ltd (ASX: AKE) share price is on form again on Tuesday.

Earlier today, the lithium miner’s shares were up 3% to a new record high of $16.02.

This means the Allkem share price is now up 42% in 2022.

Why is the Allkem share price rising again?

The catalyst for the rise in the Allkem share price today appears to be a bullish broker note out of Bell Potter.

According to the note, the broker has retained its buy rating and lifted its price target on the company’s shares to $20.04.

Based on where its shares trade at today, this implies potential upside of 25% for investors over the next 12 months.

What did the broker say?

Bell Potter has lifted its lithium price estimates for the coming years, as covered here.

This has ultimately underpinned a 20% increase in the broker’s earnings estimates for Allkem in both FY 2023 and FY 2024. It is now expecting a net profit after tax of US$904 million in FY 2023 and then US$1.1 billion in FY 2024.

Bell Potter commented:

We have updated our EV-led lithium demand model with no change to our bullish outlook; LCE demand to grow from around 0.5Mtpa in 2021 to over 1.1Mtpa in 2025 and around 3.0Mtpa in 2030. Supply analysis shows that over the next five years, Australian hard rock projects will at best meet only one third of this demand growth. We expect alternative sources of supply to remain relatively constrained and high-risk.

We expect AKE’s cash generation to lift substantially into 2023 with ongoing strength in lithium demand, commodity prices and production growth. AKE is aiming to maintain 10% share of supply in a global lithium market experiencing unprecedented growth; it has a portfolio of growth projects, balance sheet strength and cash flow from existing projects to achieve this. AKE’s portfolio is also diversified across lithium commodity, mode of production, asset location and end-user country.

The post Top broker tips 25% upside for Allkem share price appeared first on The Motley Fool Australia.

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More reading

• ASX lithium stocks are ‘the buy now, pay later of 2022’: expert
• Here’s the lithium price forecast through to 2024
• 5 things to watch on the ASX 200 on Tuesday
• 2 ASX lithium shares leaping more than 9% on Monday
• Brokers name 3 ASX lithium shares to buy

Motley Fool contributor James Mickleboro has positions in Allkem Limited. 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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