ASX up, gas volatility in 2022 and Crown shareholders are happy
Wood Mackenzie Vice President Massimo Do Odoardo said while the market will remain resilient in the near term, high prices will put pressure on demand and the case for China to switch from coal to gas will diminish.
Just when you expect the ASX to fall, it changes its name to Phoenix and rises again.
Falls in the IT, consumer discretionary, healthcare, real estate and consumer staples sectors were offset by gains in large resource companies and financials with CBAs and NABs higher.
The S&P/ASX200 has so far gained 38.60 points or 0.52% to 7,477.50, topping its 125-day moving average.
Over the past five days, the index has gained 1.62% and is currently 2.03% off its 52-week high.
The best performing stocks so far in this index are Crown Resorts Ltd up 8.08% and Liontown Resources (ASX:LTR) up 7.06%.
As we reported this morning, Blackstone has increased its offer for Crown and any binding offer will now be approved by the board.
Crown shareholders welcomed the increased offer.
“Crown remains a high-quality and valuable asset and is worth more to private equity than it will ever be worth listing on the ASX,” said Steve Johnson, chief investment officer of Forager Funds Management.
Forrager is a Crown shareholder.
“They can use more leverage and financial engineering and they don’t have an ESG discount applied.
“It is likely that an agreement will be reached, the increase in the offer price is a welcome step in the right direction and we support that the board of directors continues to press for an appropriate binding offer for shareholders. “
BHP and Rio have also had good days so far.
BHP is up 3.3%, RIO is up 2.3%, Pilbara Minerals is up 5.9% Fortescue is up 1.7%, OZ Minerals is up 2.9% and South32 is up 3 .4% after commodities jumped and Goldman Sachs (NYSE: GS) said large diversified miners were undervalued.
Volatility expected in the gas market in 2022
Wood Mackenzie released its outlook for gas and LNG and it’s not good news.
The company’s vice president, Massimo Do Odoardo, said that while the market will remain resilient in the short term, high prices will put pressure on demand and the rationale for China to switch from coal to gas will diminish.
However, he said we will see an increase in investment in renewable energy.
“Meanwhile, investments in renewables and batteries will increase, limiting the scope for growth in gas demand,” he said.
“And in Europe, where the transition to renewables is already underway, policymakers will seek to accelerate the move away from natural gas, as suggested by the EU’s recent proposal to support biomethane and hydrogen.”
On the front of the little cap
Amplia Therapeutics Ltd (ASX:ATX) is up 12.50% after doubling the batch scale of cancer drug candidate AMP945 in its latest manufacturing run.
Predictive Discovery Ltd (ASX:PDI) is up 6.30%. PDI has returned broad high-grade diamond drill results from depth of the Bankan gold project in Guinea, including 33 meters at 4.5 g/t.
Moho Resources Ltd (ASX:MOH) is up 3.33%. MOH’s research and development (R&D) collaboration with CSIRO and other outside consultants is paying off, providing the company with tax compensation of $621,000 for qualifying R&D expenditures conducted as part of its projects.
Paradigm Biopharmaceuticals Ltd (ASX:PAR) is 1.68% higher after randomizing and dosing the first subjects in its PARA_OA_002 clinical trial.