The ASX was flat for most of the day before edging higher to close out the start of the week.
The S&P/ASX200 was up just 9.00 points today to 7,461.20. Over the last five days, the index has gained 0.99% and is currently 2.15% off of its 52-week high.
Top-performing stocks were Karoon Energy Ltd and Pilbara Minerals Ltd (ASX:PLS), up 7.18% and 6.15% respectively.
Karoon reported a 23% increase in reserves at its Bauna oil project in Brazil. This prompted Macquarie to speculate on a re-rate for the company based on several catalysts.
"Karoon has been highly successful in taking on operatorship of Baúna and completing the high impact intervention campaign – we had expected some sort of reserve increase to follow, and it is pleasing to see this is broadly in line with our valuation mode," Macquarie stated.
Further catalysts include updates on two Patola wells due in March, Neon appraisal drilling and potential purchase of a second oil and gas asset.
Pilbara gained after it reported a 33% jump in sales throughout the December quarter, which prompted Morgans to upgrade the target price on the miner by 15% to $5.40 and maintained its 'add' recommendation, as it lifted its mid-term price assumptions for lithium pricing as it expects tight conditions to continue.
Looking at the sectors, Information Technology gained 1.26% and Energy climbed 0.91%. Health Care and Industrials were the hardest hit down just 0.19%, with the other sectors losing or gaining only marginal percentages.
3 things to watch for the week ahead
eToro market analyst John Gilbert shares his three things to watch in Australia in the coming days.
Australian Inflation for Q4
The recent monthly inflation indicator for November signalled a 7.3% increase year-over-year, which has set out expectations for inflation peaking in this week’s (January 25) reading at around 8% for Q4 2022.
This reading may just be one of the most important inflation reports Australia has received in its current cycle. With the Reserve Bank of Australia (RBA) pivoting late in 2022, the next step may well be a pause but the RBA will undoubtedly have a job on its hands to navigate a soft landing if inflation does come in line with expectations at 8%.
Arguments could be had for the increases seen in the November reading being temporary, with fuel-price increases already showing signs of reversing, and many of the other categories, such as food and construction, that drove inflation higher in 2022 are unwinding.
On top of this, employment unexpectedly fell last month, giving the RBA more ammunition to leave the cash rate unchanged next month, helping to move markets higher on Thursday, but this inflation data will be the key to the board's next move.
Tesla (NASDAQ:TSLA) earnings
Next Thursday morning (January 24), Tesla, Australian retail investors' favourite stock, reports its Q4 earnings after the bell. It’s already been a tough start to 2023 for Musk and co after its disastrous 2022, with Q4 deliveries missing market expectations.
This miss was the second straight for Tesla, leaving investors questioning whether the manufacturer has a demand issue.
With Musk’s Twitter escapades still ongoing, investors will be hoping to see him devoting more time to his electric vehicle love child and offer renewed positivity with clear guidance on this week’s earnings call. But despite all the noise around Tesla, fundamentals have remained strong, with earnings set to rise by 78% for the full year 2022.
Tesla is the poster child for EVs and therefore has felt the full force of EV concerns but the story doesn’t end here. EV sales growth is set to slow this year but still rise around 40% and put EV penetration of total new cars sold at over 13.3%, a significant growth in penetration.
Its Q4 earnings may set the tone for its performance in the first half of the year and some Musk magic might be needed to have Tesla powering again in 2023.
Bitcoin lodges near record run, can it continue?
Last week capped a near-record run for bitcoin, with 14 straight days of gains, as good news went a long way with macro headwinds easing with the end of the Fed’s interest rate cycle in sight. Bitcoin has now gained 35% from its low in November 2022.
Still, investors shouldn’t get too ahead of themselves with bitcoin eyeing a never seen before recession, volumes that are significantly depressed and crypto bears unlikely to lay down without a fight. However, Crypto continues to develop despite a bear market in 2022, with the ETH Merge going off without a hitch.
More upgrades will follow this year, with the Shanghai upgrade, which is set to improve the ETH blockchain's transaction speed, security and efficiency. Although not set to take place until 2024, investors are already beginning to position themselves for the next bitcoin halving.
Continued upgrades and developments for crypto will keep investors focused on long-term growth and innovation. Although many headwinds will lie ahead for crypto in 2023, it will almost certainly be a better year ahead.
Five at five
Moho Resources makes strong nickel exploration progress; Black Swan South shapes up
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Green Critical Minerals confirms presence of 2-kilometre nickel-copper-PGE trend at Glencoe in Queensland
Green Critical Minerals Ltd (ASX:GCM) has completed a geochemical soil sampling program at the Glencoe Project in Queensland, revealing the presence of a 2-kilometre-long north-south geological trend, prospective for nickel, copper and platinum group element (PGE) mineralisation.
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Kingfisher (LON:KGF) Mining returns 32% TREO sample as Mick Well potential grows
Kingfisher Mining Ltd (ASX:KFM) continues to grow the rare earth potential of Mick Well Project in the Gascoyne Mineral Field in Western Australia with further high-grade surface samples returned, including up to 32% total rare earth oxides (TREO).
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Great Boulder Resources kicks off 2023 exploration at Side Well and Whiteheads projects
Great Boulder Resources Ltd (ASX:GBR) has made a strong start to the year, completing surface geochemical surveys at the Side Well and Whiteheads projects, as well as field mapping south of Ironbark on the Side Well tenure as part of a busy 2023 exploration campaign.
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New Century Resources considers making Mt Lyell restart a reality following pivotal PFS
New Century Resources Ltd (ASX:NCZ) is one step closer to reviving a low-cost, long-life copper-gold hub thanks to a new pre-feasibility study (PFS).
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On your six
ASX investors wave goodbye to 2022 with weak December
Will the 2022 capital drain continue into 2023? Time will tell.
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The one to watch
ECS Botanics talks sustainable business model and positive quarterly cashflow
ECS Botanics Ltd (ASX:ECS) managing director Nan-Maree Schoerie tells Proactive the company is an Australian medicinal cannabis cultivator and manufacturer with operations in northwest Victoria.
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