Closing Bell: ASX shakes off morning malaise; Xero jumps on profit and revenue gains

The ASX recovered from an early morning dip, lifted by strong movements in tech and banking stocks to rise 0.22pc.

The ASX shook off its early morning pessimism to lift 0.22pc, boosted by bank and tech stocks. Pic: Getty Images

• ASX posts 0.22pc gains, recovering from dip earlier in the day

• Xero brings big profit and revenue gains in quarterly report, lifting stock 4.7pc

• Insurance Australia surges 5.7pc on Royal Automobile Club of Western Australia deal

It was looking like a day for the bears in the first hour of trading today, but the ASX has once again shown its resilience, climbing back into the green to add 0.22%.

That marks the Aussie market’s seventh day of gains, and the second time we’ve hit that seven-day mark in the space of about three weeks.

While we’re still sitting 3.69% off our 52-week average, the ASX has been trucking along, adding 1.29% over the past five trading days.

In a now familiar story, it was our tech stocks that provided much of those gains, although the Discretionary and Financials sector also made some solid progress.

Source: Market Index

Xero brings the dosh

Xero (ASX:XRO) is the hero of today’s story, finishing the day up 4.71% after hitting it out of the park with its latest quarterly report.

The accounting software company is a household name, used by large and small businesses alike.

Although the stock missed its net profit after tax target, Xero achieved double-digit jumps to its full-year revenue and profit, raking in NZ$227.82 million ($209.10 million in AUD).

Net profit was up 30%, revenue jumped 23% and overall earnings lifted 28%, delighting investors.

The banks also had an upbeat day, adding more than 1.2% to the ASX 200 Banks index.

Source: Market Index

Commonwealth (ASX:CBA), Westpac, (ASX:WBC), NAB (ASX:NAB), ANZ (ASX:ANZ) and Macquarie (ASX:MGQ) posted gains of between 0.83% and 1.65%, while Insurance Australia (ASX:IAG)outperformed with a 5.7% surge.

IAG announced a strategic alliance with the Royal Automobile Club of Western Australia today, locking-in its purchase of the RAC Insurance business and a 20-year exclusive distribution agreement for RAC branded insurance products.

Insurance Australia will gain direct access to RAC’s 1.3 million members, and better footing in the WA insurance market to boot.

ASX SMALL CAP LEADERS

Today’s best performing small cap stocks:

Security	Name	Last	% Change	Volume	Market Cap
PEK	Peak Rare Earths Ltd	0.325	171%	10721125	$42,253,993
CHM	Chimeric Therapeutic	0.008	60%	1.02E+08	$9,253,431
EDE	Eden Inv Ltd	0.0015	50%	151332	$4,109,881
AJL	AJ Lucas Group	0.008	33%	3724695	$8,254,378
SFG	Seafarms Group Ltd	0.002	33%	2250489	$7,254,899
ATX	Amplia Therapeutics	0.07	27%	56028459	$21,337,397
EDU	EDU Holdings Limited	0.165	27%	17701847	$19,571,943
HCF	Hghighconviction	0.033	27%	160676	$504,568
MSI	Multistack Internat.	0.005	25%	65445	$545,216
SHP	South Harz Potash	0.005	25%	2694073	$4,410,915
TEM	Tempest Minerals	0.005	25%	194123	$2,938,119
8CO	8Common Limited	0.017	21%	4661234	$3,137,329
LOC	Locatetechnologies	0.06	20%	20326	$10,059,692
EPM	Eclipse Metals	0.006	20%	6783059	$14,329,095
IPT	Impact Minerals	0.006	20%	880965	$19,247,483
MBK	Metal Bank Ltd	0.012	20%	152455	$4,974,590
MEM	Memphasys Ltd	0.006	20%	3406116	$9,917,991
SKK	Stakk Limited	0.006	20%	158653	$10,375,398
FRM	Farm Pride Foods	0.285	19%	42911	$55,389,901
FZR	Fitzroy River Corp	0.16	19%	145	$14,574,364
LMG	Latrobe Magnesium	0.013	18%	3320460	$28,870,710
PCL	Pancontinental Energ	0.013	18%	2887886	$89,502,444
RMI	Resource Mining Corp	0.013	18%	15526735	$7,319,463
BCA	Black Canyon Limited	0.059	18%	12500	$6,482,535
E79	E79Goldmineslimited	0.027	17%	539768	$3,643,491

Making news…

Peak Rare Earths (ASX:PEK) came flying out of a trading halt, jumping by over 150% after locking in a takeover deal with its biggest backer, Chinese rare earths giant Shenghe.

Through its arm Chenguang, Shenghe’s offering around $150.5 million, plus the proceeds of a $7.5 million cap raise, to buy out the rest of Peak it doesn’t already own.

That values Peak at roughly 36 cents a share, a massive 199% premium to where it last traded. For investors, it’s a big payday if the deal lands, but there are still a few hoops to clear.

Amplia (ASX:ATX) announced a key milestone in its pancreatic cancer trial, with 15 confirmed tumour responses now locked in, enough to show its drug, narmafotinib, works better when paired with chemo than chemo alone.

The trial is testing the company’s narmafotinib combined with standard treatments gemcitabine and Abraxane. Top-line results are due mid-Q3.

Read more on this from Tim Boreham: Amplia shares surge on pancreatic cancer trial results; Immutep offers hope

Staying on the biotech theme, Chimeric Therapeutics (ASX:CHM) has also made very promising clinical progress with its ADVENT-AML trial, achieving complete responses (remission) in two of three patients with Acute Myeloid Leukemia.

The third patient also stabilised, meaning their disease hadn’t decreased or increased in severity during the treatment period.

Importantly, the trial observed no safety concerns.

“This is great news for newly diagnosed AML patients who may benefit from our CORE-NK cells as their initial AML therapy,” said Dr Rebecca McQualter, CEO of Chimeric Therapeutics.

“We are excited to be pioneers in the cell therapy sector, with the first frontline cell therapy study in AML lead by MD Anderson Cancer Center.”

E79 Gold Mines (ASX:E79) is set to drill new gold targets at the Laverton South gold project in WA. The company drummed up the new targets after reviewing its data sets for the project, identifying several areas of interest close to known gold deposits.

ASX SMALL CAP LAGGARDS

Today’s worse performing small cap stocks:

Security	Name	Last	% Change	Volume	Market Cap
LNR	Lanthanein Resources	0.001	-50%	62793668	$4,887,272
EAT	Entertainment	0.004	-33%	78006	$7,852,716
ERA	Energy Resources	0.001	-33%	17999965	$608,094,361
NES	Nelson Resources.	0.002	-33%	7840	$6,515,783
T3D	333D Limited	0.005	-29%	114519	$1,233,284
ZMM	Zimi Ltd	0.008	-27%	51646	$4,702,982
EEL	Enrg Elements Ltd	0.0015	-25%	1252678	$6,507,557
JAY	Jayride Group	0.0015	-25%	6009801	$2,855,778
MRQ	Mrg Metals Limited	0.003	-25%	32780	$10,906,075
OSL	Oncosil Medical	0.003	-25%	997500	$18,426,329
ECS	ECS Botanics Holding	0.009	-25%	11054322	$15,552,595
RMY	RMA Global	0.026	-21%	2189843	$21,922,944
HTA	Hutchison	0.02	-20%	658233	$339,312,714
DTM	Dart Mining NL	0.004	-20%	1812126	$5,990,278
QXR	Qx Resources Limited	0.004	-20%	45496	$6,551,644
RDN	Raiden Resources Ltd	0.004	-20%	1595407	$17,254,457
VML	Vital Metals Limited	0.002	-20%	4599904	$14,737,667
8IH	8I Holdings Ltd	0.009	-18%	24000	$3,829,769
NPM	Newpeak Metals	0.009	-18%	2	$3,542,789
ORD	Ordell Minerals Ltd	0.41	-18%	344891	$17,993,835
EVR	Ev Resources Ltd	0.005	-17%	834932	$11,915,020
IFG	Infocusgroup Hldltd	0.005	-17%	131116	$1,574,561
KPO	Kalina Power Limited	0.005	-17%	10608551	$17,597,818
NWM	Norwest Minerals	0.01	-17%	839344	$5,821,434
ROG	Red Sky Energy.	0.005	-17%	27224449	$32,533,363

IN CASE YOU MISSED IT

Anson Resources (ASX:ASN) is preparing to re-enter the Mt Fuel-Skyline Geyser after securing the necessary approvals, with the goal of defining a mineral resource for the Green River lithium brine project. ASN will be drilling deeper into limestone layers in this re-entry, looking to increase the size of the lithium-rich reservoir. Read more about it here.

Blue Star Helium’s (ASX:BNL) Jackson-2 well continues to demonstrate strong flow testing, with optimised rates achieved as well as promising reports of helium concentrations. Watch StockTake for more.

Lanthanein Resources (ASX:LNR) has announced encouraging diamond drilling results from its Lady Grey project at Mt Holland in Western Australia’s Yilgarn region. Watch StockTake for more.

MTM Critical Metals (ASX:MTM) has agreed to leasing terms for a first Flash Joule Heating metal recovery demonstration plant in the United States. Watch StockTake for more.

Trading Halts

Alvo Minerals (ASX:ALV) - proposed acquisition of Lavra Velha Project
Aspen Group (ASX:APZ) - cap raise
Australian Bond Exchange (ASX:ABE) - cap raise
Chimeric Therapeutics (ASX:CHM) - new data on ADVENT-AML Phase 1B clinical trial
Codrus Minerals (ASX:CDR) - cap raise
Emu (ASX:EMU) - results of a general meeting
GreenX Metals (ASX:GRX) - cap raise
Hastings Technology Metals (ASX:HAS) - Yangibana joint venture with Wyloo
HeraMED (ASX:HMD) - customer update and its go-to-market strategy in the US
Medallion Metals (ASX:MM8) - cap raise
Uvre (ASX:UVA) - cap raise
White Cliff Minerals (ASX:WCN) - cap raise

At Stockhead, we tell it like it is. While Anson Resources, Blue Star Helium, Lanthanein Resources and MTM Critical Metals are Stockhead advertisers, they did not sponsor this article.

This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.

Originally published as Closing Bell: ASX shakes off morning malaise; Xero jumps on profit and revenue gains