WA Index

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WA Index

Issue 200 | May 2021

Welcome to the 200th edition of the Deloitte WA Index, a monthly review of Western Australian stocks and indices.

The market capitalisation of Western Australian listed companies climbed 7.7% over the month of April 2021, to close at $283.9bn. This increase was mainly led by Fortescue Metals Group, whose market capitalisation increased by $8bn over the month, due to the rise in the price of iron ore. The increase in the WA Index was consistent with global indices, which all delivered strong returns in April, with the exception of the Nikkei, which lost 1%.

Download the list of WA’s top 100 listed companies, as of 30 April 2021, explore the sections below and if you do not currently receive our WA Index,  please register to be added to our distribution list.

Highlights:

If you have any questions in relation to the Deloitte WA Index please contact Dave Andrews.

As of 30 April 2021

Commodity review

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  • LNG prices continued an upward trend, with an increase of 26.71% to US$8.90/mmbtu at the close of April 2021. The increase was attributed in part to the colder than average winter in the northern hemisphere and continued ship congestion at the Suez Canal, compounded with the ongoing effects of COVID-19. LNG continues to play a significant role in the decarbonisation of economies around the world and is set to gain further traction in powering hard-to-electrify sectors.
  • Copper prices increased 11.85% to US$9,829/MT. Chinese demand for the key metal and the value of the US dollar remaining low caused prices to surge. Optimism around the continued electrification of the global economy and the threat of mining stoppages and protests in Chile, the current top producer, also helped to boost prices.
  • Iron ore prices rallied from March, with an increase of 13.55% to US$188.50/t. With Brazilian miner Vale not expecting to resume full production until the end of next year, and China’s continued demand for iron ore in its steel manufacturing exceeding expectations, prices have continued to increase.
  • Offsetting the upward trend, Cobalt prices experienced a decrease of 9.79% to US$45,200/t amid an anticipated easing of supply bottlenecks with large supplier, the Democratic Republic of Congo, reporting no further issues in shipping to China. Some Chinese smelters have also reduced their operating rates in recent weeks due to flat demand. Over the long term, China’s second-largest battery maker committed to non-cobalt blade batteries, while China’s largest battery maker has also been slowly drifting to non-cobalt blade batteries.

Performance of WA Index and global indices

Performance of WA Index and global indices
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WA Index movement

WA Index movement
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Top performers of the month

Western Australian top performers over the past month by growth in market capitalisation

  • Rumble Resources Limited saw an 486% increase in its market capitalisation in April. The increase started in the early stages of the month after Rumble announced the commencement of the Earaheedy zin-lead-silver project, which has the potential of 100 million tonnes at between 3.5%-4.5% Zn+Pb. Following the commencement of this project, Rumble’s share price and trading volumes grew exponentially, which saw the company respond to an ASX price and volume query. This fast-tracked the release of an Earaheedy project drilling update, which saw previous drilling targets increase from 2,500m to 4,000m of drilling, with 75% already completed and the remaining 25% awaiting results. Subsequent to the release of strong drilling results, Rumble announced an AU$40m placement at $0.50 per share to fast-track its exploration work at the Earaheedy project.
  • Venturex Resources Limited saw an increase in market capitalisation of 82%. During the month Venturex released several project updates - in particular, further progress on the Sulphur Springs project. At Sulphur Springs, plans have been approved to allow development of mine access to begin along with the conversion of around 1-1.5Mt of inferred resources to indicated resources. Along with this, Venturex’s joint venture with Anax Metals Limited announced successful high grade pre-concentrates in bulk sorting tests that were suitable for off-site processing. These announcements, along with the release of the company’s’ March quarterly report, contributed to the increase over April.
  • Eagle Mountain Mining Limited saw a 103% increase in market capitalisation during April, to close at $231m. Investor confidence surged after the Oracle Ridge prospect announced its highest grades of copper, gold and silver. Following strong results at Oracle Ridge, Eagle Mountain announced it will fast track the drilling program of Oracle Ridge to June 2021 with the help of its successful $11m capital raise in February 2021. Moreover, market capitalisation compounded further with a 4km prospect of copper, gold and silver identified at the OREX prospect following field mapping tests.
  • The market capitalisation of Province Resources Limited increased by 82% during April. The strong performance was the product of a proposed acquisition of an additional area of 864m2 in the Gascoyne coastal region which will greatly compliment its current Gascoyne and HyEnergy projects. Further, Province Resources has partnered with Total Eren, a leading French global renewable energy company, to produce a feasibility study on the probable development of a paramount green hydrogen project in the Gascoyne region.

Major index players
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The top Deloitte WA Index Movers and Shakers in November were:

  • Chalice Mining Limited's market capitalisation increased by 33% over the month of April. Chalice announced the acquisition of four private properties to increase its land share of the Julimar project by 723 hectares. Additionally, Julimar showed strong drilling results from its 165 drill intersections with 94 assay results still pending, which affirms the large scale and future potential of this project. Chalice also announced late in the month that the Electromagnetic program from the South West cickel-copper-PGE project JV earn-in had commenced.
  • The market capitalisation of Galaxy Resources Limited increased by 55% during April. This growth was on the back of an announcement in late March that the company will incorporate battery grade production to Stage 1 of the Sal de Vida project with no delays, after pilot tests showed a 99.83% lithium carbonate purity. During April, Galaxy released its Sal de Vida development plan which outlined a pre-tax NPV of US$2.1bn and Internal Rate of Return of 43%, with Stage 1 production set to begin in late 2022. Galaxy is set to become the 5th largest lithium company after the agreed AU$4bn proposed equal merger with Orocobre, which will see Galaxy shareholders receive 0.569 Orocobre shares for each share in Galaxy.
  • Over the course of April, De Grey Mining Limited released strong drilling results from the Gillies prospect, whereby a gold target was identified. The Falcon prospect extended its drilling program, which confirmed the increase in scale and zone of the project, and Brolga’s prospect results consisted of large colonies of near-surface gold mineralisation. However, the major driver of the market capitalisation increase was the significant discoveries at Diucon and Eagle, with 200m and 600m strike zone extensions respectively, with additional prospects still open in surrounding zones.

Top performers of the month
Select above image to enhance the Top performers of the month

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If you have any questions in relation to the Deloitte WA Index please contact Dave Andrews.

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