CLOSING BELL: Tech woes and China combine to drag local markets down 1.5pc

• After a steep early drop, the benchmark stabilised to close 1.5% down.
• InfoTech and Materials fared worst, following a mega tech sell-off on Wall Street.
• Loyal Lithium soared more than 37% after hitting fresh spod at Trieste.

I think we can all agree that today was not a great day for the bourse, as local markets struggled to stay buoyant despite a tech sell-off on Wall Street and the slow-motion collapse of China’s economy.

I could easily spend a few hours chewing my way through trying to explain precisely how China’s economic woes are killing us softly, but – out of a profound sense of exhaustion at the idea of trying to find a new way to tell the story – I’m going to point you at Christian’s effort to untangle it.

He’s better at that stuff than I am, and I’d be doing us all a disservice by half-arsing my way through a rewrite of this wonderful summation he put together last night.

It’s okay… I’ll still be here when you’re done reading it.

…

Righto – the end result of that sorry business was a local market with sectors that looked like this:

(You can tell it’s all China’s fault, because every sector’s taken on a very patriotic red glow.)

In finer detail, even the goldies got hit pretty hard today, with the XGD All Ords Gold index falling 1.16%, unusual for the kind of day we’ve had that normally sends investors scampering for safe-haven precious metals.

The US sell-off on big tech stocks overflowed onto local markets as well, leaving the ASX All Tech index down a smile-shattering 2.42%.

There were some winners up the top end of town, though, especially in Real Estate.

That’s because prominent Aussie building builder Mirvac (ASX:MGR) landed a 4.4% pop on news of a 3.0% operating profit rise to $580 million, while shopping centre upper-middleweight Vicinity Centres (ASX:VCX) managed to crank out a 2.8% rise, despite reporting a visibly horrible 77% profit slump.

FROM THE HEADLINES

Some bad news for food (and other stuff) delivery service DoorDash today, after the company was pinged a savage $2 million for breaking Australia’s anti-spam rules, through the simple expedience of firing of more than 550,000 ads to customers who had gone through the hassle of unsubscribing.

The company was also called out by the ACMA for sending more than half a million text messages to would-be drivers for the delivery service, which rather unhelpfully lacked an option to unsubscribe from the notifications.

DoorDash is yet to respond to the fine, but will no doubt let the ACMA know when the payment is 20 minutes away, 10 minutes away, 5 minutes away, 10 minutes late and then “Delivered!”, before the regulators find out that the money is cold, and half of it’s been eaten by the driver.

Meanwhile, Woodside (ASX:WDS) is staring down the barrel of major industrial action, as wage negotiations with the company’s offshore platform workers have stalled.

“About 99% of workers at offshore platforms that supply gas to the Woodside facility have voted for industrial action, with any strike potentially disrupting shipments and sending prices for the super-chilled fuel higher,” Reuters reports.

Woodside said the company is continuing to “engage actively and constructively in the bargaining process”.

However, the Offshore Alliance (made up of the Maritime Union of Australia and Australian Workers’ Union) said differences on key issues remained, adding that Woodside is “well off the pace on key bargaining issues including job security and remuneration”.

And lastly, shares in Endeavour Group (ASX:EDV) are down 3.75% today, after bottle shop giants Dan Murphy’s and BWS (and to a lesser extent, in-person booze hole provider AHL’s pubs) fell short of earnings expectations today.

EDV managed to post a a 6.9% rise in net profit to $529 million, but it was on a hiding to nothing compared to last year, when lockdowns and Covid and the associated societal ugliness of those sent the drink-at-home fad into a frenzy.

TODAY’S ASX SMALL CAP LEADERS

Here are the best performing ASX small cap stocks:

Swipe or scroll to reveal full table. Click headings to sort:

On days like this, there’s often a lot of movement on the Small Caps ladder, and today is absolutely no exception – the three major winners from earlier today have been overtaken by a gaggle of fresh names.

Up on top of the podium is the recently-returned Loyal Lithium (ASX:LLI), which took to the skies to climb more than 45% on news of a significant development in the ongoing field program at the Trieste lithium project.

Loyal has reported the discovery of five (count ‘em… 5!) spodumene bearing pegmatite dykes with aligned implied continuous outcrops within a 6km2 area to the south of the Trieste Greenstone Belt.

Loyal says that prep work for drilling is underway, so we’ll just have to wait to see if the find is as juicy as it sounds so far.

In second place, AML3D (ASX:AL3) has ended the day up 22.22% (admit it… you read that in Richie Benaud’s voice) on news of a fresh $2 million contract from the US Navy to develop and metal 3D print a replacement component used in US Navy submarines.

Obviously, we’re not able to tell you precisely which bits of the submarines are involved, but the company has said that the “non-safety-critical (NSC) components are high demand components made with Nickel-Aluminum-Bronze”.

The contract is due to run for roughly nine months from September this year, with the fee payable up-front and upon meeting contract milestones.

And in third place at the end of the day, Lumos Diagnostics (ASX:LDX) is back in the headlines thanks to a 21.1% jump driven by a double-dose of great news for the local biotech.

For starters, LDX has signed a deal with the Dutch subsidiary of Nasdaq-listed Henry Shein Inc – the world’s largest provider of health care solutions to office-based dental and medical practitioners – to distribute the company’s FebriDx point-of-care test that can tell a bacterial lung infection from a viral one within minutes.

Additionally, LDX has been granted a core patent in Europe and Japan, covering the camera technology used in its rapid diagnostics reader platform.

“These readers have become a critical component of new point-of-care tests as they automate the reading and quantification of results and allow those results to be seamlessly integrated into electronic medical record systems,” the company says.

TODAY’S ASX SMALL CAP LAGGARDS

Here are the best performing ASX small cap stocks:

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LAST ORDERS

I touched on this briefly at lunch time, but there’s enough in the announcement to warrant a bit of a deeper dive into the how’s and why’s of BNPL company SplitIt (ASX:SPT) deciding it’s time to up stumps and move overseas.

Private equity group Motive Partners has signed on to provide $77.5 million in funding, while the company leaves the ASX for warmer climes in the Cayman Islands.

Chief executive Nandan Sheth told our friends at The Australian that the company had been chronically undervalued during it’s time as a publicly traded company, and the move to the Caymans will provide room for “a simplified corporate structure and a more flexible operating environment, as well as improved prospects of accessing future capital”.

The other contributing factor to the decision is that it will allow SplitIt to focus on the offering that the company says sets it apart from its competitors in that space – the fact that it uses a customer’s existing credit from a credit card issuer, and offers a white-labelled product to merchants rather than dealing with end consumers.

The move isn’t quite a done deal, as it requires shareholder approval, which SPT will be seeking with a vote on the Motive proposal in late October or early November.

Elsewhere, there’s been a bit of movement (kind of) at the helm of SI6 Metals (ASX:SI6), with current exec chair Jim Malone assuming the title of managing director, effective immediately.

Malone took on the role of executive chair in May of this year, brought on board to manage day-to-day operations including overseeing the three month entitlement issue/capital raising activities the company was embarking on.

At a glance, that looks to have wrapped up, presumably to the company’s satisfaction as it’s unlikely they’d be tapping Malone for the EC role if it hadn’t.

TRADING HALTS

Imugene (ASX:IMU) – Capital raising.

Sacgasco (ASX:SGC) – Update on the PNOC farm-in.

ActivePort Group (ASX:ATV) – Capital raising.

Core Lithium (ASX:CXO) – Capital raising.

Chrysos Corporation (ASX:C79) – Announcement regarding an ASX price and volume query.

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