“Why are bank shares up so much lately?”

No, it’s not a rhetorical question… it’s one that was sent in by one of our readers.

And it’s a good one.

The answer, unfortunately, is much harder.

—–

But before that — we’re doing something very cool. We’re going to host a LIVE, in-person recording of our podcast, Motley Fool Money. It’s going to be on the Gold Coast on the evening of Wednesday, March 27.

If you’re in the area and you’d like to see us record the podcast, we’d love to see you there. Just click on this link for more information and to RSVP!

——

If you’re a regular consumer of financial media, you’ll know that the talking heads are often asked these sorts of “Why did X happen” questions.

And they answer them, confidently, looking straight down the barrel of the camera.

Now, if you’ve been a regular reader of my articles, you’ll know one of my favourite investing quotes comes from John Kenneth Galbraith:

“Pundits forecast not because they know, but because they are asked.”

If he were alive today, he might add a companion:

“Pundits confidently ascribe motivations to share price movements not because they know, but because they are asked.”

Which might sound unkind. After all, I’m often one of the aforementioned talking heads, and I’ve been asked those sorts of questions!

I try to make my answers equivocal. I usually start with some version of ‘We can’t be sure, but…’ or “No-one knows, however…’.

Truth be told, I’d be happier if I wasn’t asked, but that’s not up to me.

To be fair, sometimes the question has a very clear and direct answer.

“Why were shares in Company X up 20% today?”

Perhaps because they got a takeover offer. Maybe they released earnings.

They’re pretty clear and direct ’cause and effect’ situations.

Other times, less so.

It’s likely that a move in a commodity price impacts a miner’s share price, but not necessarily.

Sometimes a stockbroker might put out a widely circulated buy or sell recommendation, which might – or not – impact a share price.

And that’s at the individual company level.

What about the market itself?

That’s when things get to a whole new level of abstraction.

On any given day, there are dozens of potential reasons why the share market could move.

But here’s where it gets silly: sometimes it moves because of what traders think others will think – regardless of whether it actually matters!

As I said, silly.

Let me ask you: is that really a game you want to play? Is it something you think you can earn a market-beating return from doing?

Me? No, and no. “Speculating on speculators” is a whole level of abstraction, and a degree of difficulty I can do without!

The good news? You don’t have to play that game. In fact, you shouldn’t!

You can simply let speculators speculate, and go about the business of investing.

But – and this is vital – once you decide you’re not playing that game, you need to get good at ignoring it.

The marathon runner doesn’t worry about the competitor who’s trying to run the first 100m in less than 10 seconds – she knows she won’t win that particular sprint, but she also knows that’s not her goal.

She’s focused on the 42km after that.

Which, I think, is a nice analogy for investing.

Investors – the stock market equivalent of marathon runners – don’t worry about the short-term sprints.

We focus on the marathon itself.

“Am I doing the things that mean I’ll finish the race in good shape?” is the only question that matters.

Sometimes, you’ll feel like you’re falling behind, as others sprint past you. Maybe they get lucky. Maybe they happen to own a ‘hot stock’. Maybe they’re just in the right place at the right time… for now.

But then, as you run your own race, you’ll find yourself passing them, as they sit on the side of the road, exhausted, injured, and unable to finish.

That is not the way you want your investing life to go.

Here’s the other thing: you don’t need to “win” the investing race. There’s only one Warren Buffett. And, unfortunately, I’m not him. But I don’t need to be.

I need to do to things:

1. Actually finish the race, without flaming out in the process; and

2. Finish not on the podium, but just with a result that meets my goals.

Which brings me back to the original question.

I don’t know why bank shares are going up. I would imagine it reflects a mood that rates will come down sooner than expected, and that banks will suffer fewer mortgage defaults, as a result. And/or that as rates stagnate, then fall, bank dividends will look better, by comparison, for those looking for income.

Those are plausible reasons. They might even be accurate.

Or not.

There’s no way to know what the tens of thousands of Commonwealth Bank of Australia (ASX: CBA) shareholders are thinking, right now. Or what the hundreds who bought and sold CBA shares yesterday were thinking, then.

So, while we can speculate on the answer, I’m not sure the speculation is useful.

First, because it could be dead wrong, so it’s little more than a curiosity.

But second because even if we did know why, in hindsight, it wouldn’t help us get to our long-term goal.

As Warren Buffett put it:

“… like Cinderella at the ball, you must heed one warning or everything will turn into pumpkins and mice: Mr. Market is there to serve you, not to guide you. It is his pocketbook, not his wisdom, that you will find useful. If he shows up some day in a particularly foolish mood, you are free to either ignore him or to take advantage of him, but it will be disastrous if you fall under his influence.”

So, if you get offered a good price – either to buy or to sell – by all means, take it.

But otherwise, ignore share price fluctuations.

Here’s what I’d do, instead: Ask yourself whether the business you own is likely to deliver good results for shareholders over the next 5 – 10 years. And build your portfolio accordingly.

No, that’s not as exciting. And yes, you’ll have to embrace uncertainty. But that’s just investing.

And a helluva lot better — and likely far more profitable — than speculating!

Fool on!

The post Why are bank shares up so much? appeared first on The Motley Fool Australia.

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Motley Fool contributor Scott Phillips 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 Reddit Inc (NYSE: RDDT) stock price had an incredible start to life on the stock market, rising by 48%!

This social media platform allows users to discuss topics of almost anything you can think of such as TV shows, the news, jokes, sports, personal finance and ask-me-anything Q&As.   

It’s been a while since a large social media business listed on the stock market. The rising interest rate environment put a dampener on large initial public offerings (IPOs) in the US and Australia.

But, could Reddit’s stock success spur a new wave of listings?

Tapping into AI excitement

According to reporting by Reuters, Reddit recently signed a content licensing deal with Alphabet‘s Google worth around $60 million per year. Reddit is making its content available for Google to train its artificial intelligence models.

However, Reddit still makes most of its revenue from advertising, which is a competitive area.

While the IPO was priced at US$34 per share, it finished the day’s trading at $50.44, which was a rise of just over 48%.

The chief operations officer from Reddit, Jen Wong, said:

At the core we are a growth company. Achieving our mission means that we want to grow users and community.

While Reddit has a large social presence and is a core digital destination where lots of people spend time on the internet, its valuation is only several billion US dollars, compared to more than US$1 trillion for Meta Platforms. Reddit has a lot of work to do to make a sizeable profit.

Can this excite the local ASX IPO market?

Reddit doesn’t get as much visitation as Facebook, YouTube, Instagram, TikTok or a few others, but it’s still one of the most visited digital sites, reportedly just behind LinkedIn in terms of where US social media users go, according to Statista.

There are currently only five ASX IPO listings planned at the moment – they are all small, with raisings of between $5 million to $10 million planned.

However, we should also remember that Chemist Warehouse is planning a reverse listing via Sigma Healthcare Ltd (ASX: SIG).

I don’t have any inside information about which businesses are planning to list next, but I think Reddit’s success and the ongoing strength of the overall ASX share market are very positive for potential listings.

I’m not sure the ASX will be able to attract the likes of Canva, but the foundations are there for smaller businesses to want to take advantage of the desire of investors for growing businesses.

While I wouldn’t necessarily be interested in tiny, speculative, exploration ASX mining shares or small ASX biotech shares, there can be merit in looking at growing companies with smaller market capitalisations. They are earlier on in their growth journeys and could deliver stronger long-term returns.

Of course, there are lots of potential great growth opportunities already on the ASX.

The post Reddit stock soars 48% on debut! Will the ASX IPO market heat up again? appeared first on The Motley Fool Australia.

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Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to Meta Platforms CEO Mark Zuckerberg, is a member of The Motley Fool’s board of directors. Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. Motley Fool contributor Tristan Harrison 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 Alphabet and Meta Platforms. The Motley Fool Australia has recommended Alphabet and Meta Platforms. 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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There aren’t too many income payers on the ASX that pay their investors quarterly dividends. In Australia, biannual payouts are the norm, with most investors having to wait six months in between paycheques. But not when it comes to the Rural Funds Group (ASX: RFF) dividend distribution.

This agricultural real estate investment trust (REIT) and farmland landlord is one of the few ASX dividend shares that funds quarterly shareholder payments. These aren’t insignificant either. Rural Funds units are currently trading on a dividend distribution yield of over 5%.

But if you wish to receive the latest quarterly dividend from Rural Funds, time is running out.

Rural Funds is scheduled to fork out its latest dividend distribution on 30 April next month. It will be a payment worth 2.93 cents per unit. That’s the same payment investors have received every quarter since September 2021 from Rural Funds.

Like most distributions from ASX REITs, this payment will be unfranked.

However, if you are keen to see this payment arrive in your bank account, and you don’t already own Rural Funds units, time is running out.

How to secure the latest dividend distribution from Rural Funds Group

That’s because Rural Funds is scheduled to trade ex-distribution next week on Wednesday, 27 March.

When an ASX share or REIT trades ex-dividend (or in this case, ex-distribution), it rules out new investors from receiving the payment in question. Put another way, if you own Rural Funds units before 27 March, you will receive this latest payout. But if you buy them on 27 March onwards, you’ll miss out this time.

So expect to see a bit of a drop in the Rural Fuds unit price next Wednesday when the markets open. This reflects the inherent loss of value from this dividend distribution.

Distribution-eligible unitholders have until 2 April to choose the optional dividend reinvestment plan (DRP) for Rural Funds. That’s if they wish to receive additional Rural Funds units in lieu of the traditional cash payment.

So now you know what you have to do if you wish to bag this latest payout from Rural Funds Group.

At the current Rural Funds unit price of $2.12, this ASX REIT is trading on a trailing dividend distribution yield of 5.53%.

The post Want the latest quarterly dividend from Rural Funds? You’d better hurry appeared first on The Motley Fool Australia.

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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 positions in and has recommended Rural Funds Group. 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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S&P/ASX 200 Index (ASX: XJO) iron ore shares have taken a beating in 2024.

Although that trend took a sharp turn for the better this week.

Shares in the big iron ore miners like BHP Group Ltd (ASX: BHP), Rio Tinto Ltd (ASX: RIO) and Fortescue Metals Group Ltd (ASX: FMG) have come under pressure amid a sharp retrace in the price of the steel-making metal.

Iron ore kicked off 2024 trading at around US$145 per tonne.

Last Friday, that same tonne was trading for just under US$100.

But an uptick in optimism over the outlook for China’s steel-making output on the back of economic data released over the weekend has helped drive the iron ore price higher this week. The industrial metal gained another 3.2% overnight to trade for US$109.15 per tonne.

As you’d expect, that’s also helped lift the ASX iron ore shares.

Here’s how the big three have performed so far this week:

• BHP shares are up 3.9%
• Fortescue shares are up 6.2%
• Rio Tinto shares are up 3.9%

This sees the S&P/ASX 300 Metals & Mining Index (ASX: XMM) up 3.4% so far this week, compared to the 1.3% gain posted by the ASX 200.

Still, ASX iron ore shares have some way to go before making up for their 2024 losses.

Year to date:

• BHP shares remain down 12.4%
• Fortescue shares remain down 14.8%
• Rio Tinto shares remain down 10.8%

Here’s why the worst of the selling could be over.

ASX iron ore shares eyeing Chinese demand

According to Australia and New Zealand Banking Group Ltd (ASX: ANZ) analysts Daniel Hynes and Soni Kumari (courtesy of The Australian Financial Review), markets have already priced in slumping steel demand from China’s weak property sector.

And steel demand from the world’s number two economy, and by connection ASX iron ore shares, looks like it will be supported by strong growth in other areas.

According to ANZ’s analysts:

Iron ore prices may be near a floor amid a reset in expectations around demand. Weak consumption from the property sector is being countered by robust demand from other sectors.

ANZ doesn’t forecast any miraculous rebound for China’s struggling property sector this year. The analysts said they don’t see a “near-term solution”, adding that “steel demand from its residential real estate is likely to fall further this year”.

But infrastructure investments, particularly in renewables, are likely to see increased steel demand, alongside a flagged boost in social housing investment.

ANZ also expects China’s car manufacturers, alongside the nation’s shipping and machinery sectors, to boost iron ore demand this year.

“Together, these areas of growth should lift China’s steel consumption by 0.5% in 2024,” the analysts said.

As for what prices the ASX 200 iron ore shares can expect for their core product for the remainder of 2024, the analysts said:

With a large portion of Chinese domestic supply produced at costs higher than US$100/tonne, we see the current price as a floor. Ultimately, we expect iron ore to trade in a US$90–110/t range for the remainder of the year.

The post Is the worst of the selling now over for ASX iron ore shares? appeared first on The Motley Fool Australia.

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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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The S&P/ASX 200 Index (ASX: XJO) is out of form on Friday and on track to end the week in the red. In afternoon trade, the benchmark index is down 0.3% to 7,759.9 points.

Four ASX shares that are falling more than most today are listed below. Here’s why they are dropping:

Arafura Rare Earths Ltd (ASX: ARU)

The Arafura Rare Earths share price is down 2.5% to 20 cents. This may have been caused by a broker note out of Bell Potter this week. In response to a strong rebound this month, the broker has downgraded the rare earths developer’s shares to a speculative neutral rating with a 19 cents price target.

Pentanet Ltd (ASX: 5GG)

The Pentanet share price is down 5% to 7.8 cents. This has been driven by the telco raising funds via a placement. Pentanet has received binding commitments for a placement of shares to multiple international and domestic institutional and high-net worth investors. The company will raise $4.28 million at a discount of 7.2 cents per new share. These funds will be used to invest in Nvidia cloud servers and infrastructure, working capital for growth, and the costs of the placement.

Sigma Healthcare Ltd (ASX: SIG)

The Sigma Healthcare share price is down 1.5% to $1.21. This may have been driven by a broker note out of Morgans this morning. According to the note, the broker has downgraded the pharmacy chain operator and distributor’s shares to a hold rating with a $1.14 price target. It made the move on valuation grounds.

Webjet Ltd (ASX: WEB)

The Webjet share price is down over 1% to $8.59. This also appears to have been driven by a broker downgrade. According to a note out of Macquarie, its analysts have downgraded the online travel agent’s shares to a neutral rating with an $8.88 price target. As with Sigma, Macquarie made the move on valuation grounds.

The post Why Arafura, Pentanet, Sigma, and Webjet shares are falling today appeared first on The Motley Fool Australia.

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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 positions in and has recommended Macquarie Group and Nvidia. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended Pentanet. The Motley Fool Australia has positions in and has recommended Macquarie Group. The Motley Fool Australia has recommended Nvidia. 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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Coles Group Ltd (ASX: COL) shares could be a great option for an investment portfolio this week.

That’s what analysts at Bell Potter think, which have recently named the supermarket giant on their Australian equities panel.

The broker highlights that its panel of favoured Australian equities offer attractive risk-adjusted returns over the long term. It then explains:

We consider the current macro-economic backdrop and investment environment, focusing on quality companies with proven track records, capable management and competitive advantages. We’ve examined our analysts’ buy-rated stocks and preferred high conviction calls, to identify our preferred stocks in a range of sectors.

Why are Coles shares on the list?

Bell Potter added Coles to its preferred stock panels in response to its half-year result from last month.

It notes that Coles reported EBIT of $1,064 million for the six months, which was ~5% ahead of its estimates and the analyst consensus.

In addition, it points out that management has multiple levers for profit improvement. These include its private label positioning attracting price conscious consumers, further reductions in theft rates through technology and operational improvements, growing Coles 360 media income, and productivity improvements from the Witron automated distribution centres.

It is for these reasons that the broker prefers Coles shares over rival Woolworths Group Ltd (ASX: WOW) and is forecasting earnings ~5% above consensus estimates in FY 2025.

Plenty of upside potential

Although Coles shares have rallied 6% since this time last month, Bell Potter sees scope for much bigger returns over the next 12 months.

The broker has put a buy rating and $19.00 price target on its shares. This implies potential upside of 15% for investors.

In addition, the broker is expecting a 4% dividend yield over the period, which lifts the total potential return to approximately 19%.

It concludes:

Costs are expected to remain elevated but should moderate through FY24 and FY25 as general inflation tapers off. In the medium term, 1) higher immigration should support grocery spending, and 2) Coles is entering a period of elevated capex intensity as it reinvests to modernise its supply chain and to catch up to competitors on online and digital offerings, which should help Coles maintain its market position.

The post Why Coles shares could be a best buy for blue chip investors appeared first on The Motley Fool Australia.

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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 positions in and has recommended Coles Group. 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 Federal Court has approved a travel order against the suspended chief of an ASX-listed technology company to prevent him from leaving the country.

The Australian Securities and Investments Commission this week submitted an application to stop Dubber Corporation Limited (ASX: DUB) chief executive and managing director Stephen McGovern exiting Australia while it conducts an investigation.

The order also prevents Christopher William Legal solicitor and principal Mark Madafferi from leaving the country.

ASIC investigating ASX CEO over missing funds

Dubber shares were placed in a trading halt on 27 February, and have been frozen ever since.

The company then reported to ASIC that McGovern was suspended as managing director and chief executive and the reasons why it took that action.

On March 1, the corporate watchdog started investigating the suspicions that funds in a term deposit belonging to Dubber and one of its subsidiaries had been misused.

The deposits were allegedly held in trust by Madafferi.

According to ASIC, $26.6 million remains unaccounted for and it has “concerns” that McGovern and Madafferi may have breached the Corporations Act.

The travel order hearing was held with both men absent.

McGovern is a UK national while Madafferi is an Australian citizen.

The matter will be heard again in court on Wednesday.

What has Dubber been doing?

Dubber operates a cloud telecommunications platform for corporate clients.

In 2021, the share price flew above the $4 mark, but at the time of the trading halt last month it was languishing at 22 cents.

Despite the term deposit scandal, Dubber announced last week that it had secured a $5 million loan from Thorney Investment Group.

“Unquestionably we were shocked by Dubber’s recent announcement,” Thorney Investment Group executive chair Alex Waislitz said.

“Notwithstanding, Thorney continues to believe Dubber has sound prospects having built a substantial global client base that includes many Tier 1 communications service providers.”

The post ASX tech CEO blocked from leaving Australia as $26.6 million goes missing appeared first on The Motley Fool Australia.

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Motley Fool contributor Tony Yoo 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 Dubber. 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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If you own Liontown Resources Ltd (ASX: LTR) shares, you will probably be aware that it won’t be long until the Kathleen Valley Lithium Project commences production.

The lithium developer’s most recent update reiterated that “the commencement of first concentrate production [is expected] from mid-calendar year 2024.”

Given that we are now in the back end of March, this means that Liontown could be pulling lithium out of the ground in just a few months.

This also means that the days of burning through cash could soon be behind the company. But just how soon could Liontown be profitable? Let’s take a look and find out.

When will Liontown be profitable?

Let’s now go through what analysts at Goldman Sachs are forecasting year by year, starting with FY 2025.

According to the note, the broker expects Liontown to deliver spodumene production of 260kt in FY 2025. And with Goldman forecasting an average realised price of US$922 a tonne for 6% grade spodumene, it estimates that this will lead to revenue of A$363 million for the year.

Unfortunately, that won’t be enough for an underlying EBITDA profit, with Goldman expecting a loss of $18 million for the period.

But it gets better in FY 2026 when Goldman expects production to ramp up to 470kt with an average realised spodumene price of US$887 a tonne.

This is forecast to generate revenue of A$628 million, positive underlying EBITDA of A$177 million, and underlying earnings of A$81 million.

It will be onwards and upwards from here, which could be good news for Liontown shares.

FY 2027 and FY 2028 forecasts

For FY 2027, Goldman estimates production of 512kt and an average realised price of US$1,073 a tonne.

This is expected to lead to revenue of A$798 million, underlying EBITDA of A$282 million, and underlying earnings of A$140 million.

Finally, in FY 2028, production is forecast to come in at 579kt with an average realised spodumene price of US$1,266 a tonne.

Goldman believes this will underpin revenue of A$1,048 million, underlying EBITDA of A$418 million, and underlying earnings of A$232 million.

At this point, the broker believes that Liontown will be in a position to pay its first dividend. Though, only a modest 0.9 cents per share payout is currently forecast by the broker.

The post Own Liontown shares? Here’s when the lithium stock could be profitable appeared first on The Motley Fool Australia.

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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 positions in and has recommended Goldman Sachs Group. 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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S&P/ASX 200 Index (ASX: XJO) coal shares have struggled in 2024 amid slumping coal prices.

Year to date the New Hope Corp Ltd (ASX: NHC) share price is down 16%.

And shares in rival coal stock Whitehaven Coal Ltd (ASX: WHC) have slumped 15% this year.

Last April coal was trading for almost US$200 per tonne. That slipped to lows of US$116 per tonne in late February this year. Coal prices have since moved higher to around US$130 per tonne this week.

For its half year results, New Hope reported a 58% decline in its average realised coal price to AU$197 per tonne. That saw revenue for the six months fall by 45.9% year on year to $856.6 million.

It was a similar story with Whitehaven.

The ASX 200 coal share achieved a greatly reduced realised average price of AU$220 per tonne over the six months. The miner’s half-year revenue plunged 58% year on year to $1.59 billion.

So, could China’s shifting market dynamics help reverse the slide?

Chinese tailwinds for ASX 200 coal shares?

It’s been a bit over a year since China lifted its import restrictions on Aussie coal, offering a boost to ASX 200 coal shares.

Coal imports were targeted in 2021 alongside other Aussie commodities after Australia’s government called for an international inquiry into the Covid origin.

While below pre-pandemic levels, China’s coal imports from Australia reached 52.5 million tonnes in 2023. December’s 6.7 million tonnes of Aussie coal imports were up 6.4% month on month, according to Reuters.

China makes up more than half of the global coal consumption. And despite a huge domestic mining industry, Chinese coal imports hit a record high of 474.4 million tonnes in 2023.

Which brings us to the latest Chinese production data, which could help rekindle ASX 200 coal shares.

According to China’s National Bureau of Statistics, domestic coal production fell 4.2% in January and February compared to the same period in 2023. The first such pullback since September 2021.

But, as Bloomberg reports, China remains heavily reliant on coal-fired energy, with coal power generation increasing by 9.7% year on year over the first two months of 2024.

And while Chinese coal demand isn’t forecast for significant growth, it’s also not expected to abate any time soon.

According to Zhang Hong, deputy secretary-general of the China National Coal Association:

Coal demand is reaching a plateau period, but its fundamental role in supporting China’s energy supply safety is hard to change in the short-term. The role of coal as primary energy and a fallback for ensuring energy security remains unchanged, even when it is close to reaching a plateau.

With China’s coal appetite forecast to remain voracious amid signs of crimping domestic production, ASX 200 coal shares like New Hope and Whitehaven could stand to benefit.

The post Could this development out of China reignite ASX 200 coal shares? appeared first on The Motley Fool Australia.

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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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Core Lithium Ltd (ASX: CXO) shares are catching the eye on Friday.

In morning trade, the struggling lithium miner’s shares are up a sizeable 9% to 18 cents.

Why are Core Lithium shares jumping?

Investors have been buying the company’s shares today in response to the release of announcement relating to the exploration programs completed during the 2023 field season.

According to the release, final assays have been received from the drilling and geochemical programs with encouraging results. Management believes these demonstrate the prospectivity of the entire Finniss project area.

It highlights that wide zones of spodumene mineralisation were intersected in drilling at the high priority Ah Hoy and Seadog prospects. These results suggest the potential for these two adjacent prospects to form part of a larger cluster of mineralised pegmatites.

As things stand, Core Lithium is still interpreting the results and updated resource models are expected to be announced next month.

What’s next?

The exploration continues at Finniss in 2024. Its focus will be on testing large scale pegmatite targets which can potentially sustain lower cost production. This could be very important in the current environment of low lithium prices.

Outside Finniss, exploration will also focus on unlocking value in Core Lithium’s regional lithium, uranium, and gold targets in the Northern Territory and South Australia. Details on the company’s new exploration strategy and budget will be provided during the next quarter.

‘Exceptional results’

Core Lithium’s interim CEO, Doug Warden, was very pleased with the drilling results. He said:

The exceptional results from Ah Hoy and Seadog have successfully increased our confidence in the existence of a cluster of mineralised pegmatites. The close proximity of these prospects and others yet to be tested, could benefit any future development study outcomes. We are excited about the implications of these new results, together with earlier results, for our resource update to be released next month.

Warden was also feeling pleased about the potential for the company to lower its production costs and unlock value in other projects. He adds:

It is pleasing to see that our exploration strategy of finding larger pegmatite targets to drive future low cost production at Finniss is gaining momentum. I am very excited by the exploration potential that exists, not only within our main project at Finniss, but also at our other projects within the Northern Territory, where we will be looking to unlock the value in future exploration programs.

The post Core Lithium shares jump 9% on ‘exceptional’ exploration results appeared first on The Motley Fool Australia.

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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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