Red Alert: Are We Headed for a Resource Rout? ASX 200 Live Coverage - Wednesday, November 5th
Buckle up, investors! Today's market action is painting a worrying picture, particularly for the resource sector. We're kicking off our live coverage of the ASX 200 on Wednesday, November 5th, and we're trialing a new format to bring you the most up-to-date information. Expect a flurry of updates pre-market and consistent reporting throughout the day. Our live blog will conclude around 2:00 pm AEDT. Make sure to manually refresh your browser for the latest insights. And we want to hear from you! Tell us how we can make this even better by clicking this link: Survey Link.
Resources Take a Beating
[12:49 pm AEDT] Across the board, resource stocks are getting hammered today. It's a sea of red, and the losses are significant. What's driving this sudden downturn? Is it a temporary blip or a sign of deeper trouble? Let's break it down:
- Iron Ore: The iron ore giants are feeling the pressure. Fenix Resources is down a staggering -9.7%, followed by Fortescue (-3.8%), MinRes (-3.5%), Rio Tinto (-2.4%), and BHP (-1.0%). Could this be linked to concerns about Chinese demand, or are there other factors at play?
- Copper: Copper miners are experiencing even steeper declines. Aeris Resources is plummeting (-15.0%), with 29Metals (-11.8%), Firefly Metals (-7.4%), Capstone Copper (-6.4%), and Sandfire Resources (-3.4%) also suffering losses. Copper is often seen as a bellwether for the global economy. Does this downturn suggest a weakening economic outlook?
- Gold: Gold, traditionally a safe haven, isn't providing much shelter today. St Barbara is taking a hit (-10.1%), along with Resolute Mining (-8.3%), Meeka Metals (-7.1%), Aurelia Metals (-8.5%), Black Cat Syndicate (-6.8%), Bellevue Gold (-6.3%), and Alkane Resources (-6.3%). Is this a sign that investors are losing faith in gold as a hedge against uncertainty?
- Uranium: The uranium sector is also feeling the pain. Alligator Energy is down significantly (-10.7%), followed by Peninsula Energy (-9.4%), Paladin Energy (-8.5%), Bannerman Energy (-7.5%), Boss Energy (-5.9%), and Deep Yellow (-5.9%). What is causing this sudden aversion to uranium stocks?
- Critical Metals: Critical metals, essential for the green energy transition, are surprisingly weak. Brazilian Rare Earths is down sharply (-14.3%), with Arafura Rare Earths (-11.3%), Australian Strategic Metals (-10.8%), Lindian Resources (-5.8%), Syrah Resources (-6.1%), Chalice Mining (-5.2%), Hastings Metals (-5.1%), Iluka Resources (-4.5%), and Lynas Rare Earths (-3.5%) all in the red. Could this impact the pace of the clean energy transition?
- Coal: Even coal producers are experiencing a downturn. Coronado Global is down (-5.6%), followed by Stanmore Resources (-4.5%), Whitehaven Coal (-2.3%), and New Hope (-1.5%). Is this a sign of a broader shift away from fossil fuels, or a temporary market correction?
A Sea of Red: Equities Under Pressure
[12:47 pm AEDT] It's a tough day for stocks in general. The S&P/ASX Emerging Companies Index, often seen as a risk barometer, is down a concerning 4.6% and hovering near its intraday lows with no sign of a rebound. This is definitely worth watching.
And this is the part most people miss... The index has now fallen 14% since its high on October 14th, breaching the 50-day moving average (the green line on the chart) with ease. This could signal increased volatility in the coming weeks. Are we entering a period of heightened market uncertainty?
[S&P/ASX Emerging Companies daily chart (Source: TradingView)]
ASX 200: The Winners and Losers
[11:38 am AEDT] We're seeing a mixed bag on the ASX 200. Blue-chip defensive stocks are showing slight gains, offering some stability in the market. However, gold, lithium, and defense stocks are facing significant selling pressure. What's driving this divergence in performance?
Top ASX 200 Gainers:
| Ticker | Company | % Chg | Price |
| :----- | :-------------------------- | :----- | :------ |
| BXB | Brambles | 2.20% | $23.93 |
| MPL | Medibank | 1.96% | $4.94 |
| IAG | Insurance Australia Group | 1.87% | $7.91 |
| CBA | Commonwealth Bank | 1.67% | $177.01 |
| SDF | Steadfast Group | 1.61% | $5.38 |
| AUB | Aub Group | 1.59% | $36.50 |
| ASX | ASX | 1.56% | $57.26 |
| SCG | Scentre Group | 1.50% | $4.07 |
| TCL | Transurban Group | 1.49% | $14.67 |
| AMC | Amcor | 1.41% | $12.19 |
Top ASX 200 Losers:
| Ticker | Company | % Chg | Price |
| :----- | :---------------- | :------ | :----- |
| RSG | Resolute Mining | -9.66% | $0.80 |
| OBM | Ora Banda Mining | -8.27% | $1.09 |
| PDN | Paladin Energy | -8.07% | $8.54 |
| LTR | Liontown Resources| -7.08% | $1.05 |
| CSC | Capstone Copper | -6.56% | $12.39 |
| DRO | Droneshield | -6.37% | $3.90 |
| PNR | Pantoro Gold | -5.78% | $4.73 |
| IPX | Iperionx | -5.41% | $5.95 |
| JHX | James Hardie | -5.19% | $28.89 |
| NXG | Nexgen Energy | -5.13% | $13.31 |
Australian Industry Index: A Glimmer of Hope?
[11:29 am AEDT] The Australian Industry Index showed a slight improvement in October, rising 4.2 points to -11.2 (seasonally adjusted). While still below neutral (0), it's the highest reading in over a year. Could this be the start of a turnaround?
Key takeaways:
- The employment indicator returned to neutral for the first time in 18 months, driven by improved labor supply in the construction sector. This is welcome news for businesses struggling to find workers.
- Construction activity increased during the month and has shown steady improvement over the past year as supply constraints ease and market conditions improve. This suggests that the construction industry is finally starting to recover.
- Manufacturing performance continued to weaken, particularly in the metals sector, which is facing challenges from high energy prices and global trade headwinds. This highlights the ongoing difficulties faced by Australian manufacturers.
- Pricing indicators suggest that industry is beginning to raise prices again after a year of absorbing cost increases. This could lead to increased inflation in the coming months.
Source: AI Group
Carma's Rocky Start: ASX Debut Disappoints
[11:08 am AEDT] The highly anticipated debut of Carma on the ASX is proving to be a bumpy ride. Trading at $2.53 after listing at 11:00 am AEDT, it's below the offer price of $2.70. What went wrong?
It seems the timing couldn't be worse, as the market environment has become increasingly challenging for equities. The S&P/ASX Emerging Companies Index is down 3.5% today and a significant 12.6% since its October 14th high. Even Advanced Innergy, a profitable company (at ~14.6x FY26 NPAT), closed at 96 cents on its debut, below its $1.00 per share IPO price. This suggests a broader market aversion to new listings.
For those unfamiliar, Carma operates a technology-driven platform for buying and selling used vehicles in Australia. They source vehicles, recondition them, and offer them for sale online.
Here's a look at Carma's financial projections:
| | FY23 | FY24 | FY25 | FY26e |
| :------------- | :----- | :----- | :----- | :----- |
| Revenue ($m) | 48.0 | 68.9 | 71.4 | 127.6 |
| % growth | ~ | 43.5% | 3.6% | 78.7% |
| EBITDA ($m) | -27.3 | -31.5 | -27.8 | -27.7 |
| Loss after tax ($m) | -29.4 | -36.4 | -35.9 | -35.3 |
Notice the projected revenue jump between FY25 and FY26. But here's where it gets controversial... The company forecasts a whopping 78% revenue growth in FY25-26, despite only 3.6% growth in FY24-25. Is this overly optimistic? Can Carma realistically achieve this aggressive growth target?
ASX 200 Struggles to Gain Traction
[10:30 am AEDT] The ASX 200 is down 0.26% in early trading, with positive performance in some sectors offset by a widespread sell-off in resource stocks. The miners are clearly weighing on the overall market.
- Iron ore giants BHP (-1.2%), Fortescue (-2.1%), and Rio Tinto (-1.5%) are all trading lower, further confirming the downward trend in the iron ore sector.
- Gold miners are struggling as gold prices fell 1.7% overnight to US$3,931/oz. Most gold mining stocks are down around 1-3%.
- Copper miners, including Sandfire (-2.1%) and Capstone Copper (-6.0%), are also feeling the impact of the overnight pullback in copper prices.
- Lithium stocks, such as Pilbara Minerals (-5.6%) and Liontown Resources (-7.7%), are sharply lower, reversing recent gains. The lithium sector has been volatile lately. Is this a temporary correction or a sign of deeper issues?
[ASX 200 sector performance (Source: Market Index)]
Goodman Group's Data Center Push
[10:26 am AEDT] Goodman Group just concluded its 1Q26 update conference call. The key takeaway? Data centers are now the company's primary focus.
- Data centers are projected to account for over 75% of the $17.5 billion+ development workbook by June 2026. The company plans to activate 500 megawatts of project capacity as the first phase of a total 1.8 gigawatts.
- The development strategy centers on metro cloud-based data centers near major cities, with secured power increases driven by the Tokyo project and ongoing negotiations for additional capacity. Partnerships in Australia and Europe are expected in the second half of FY26, but no North American partnerships are planned for FY26. Why the focus on Australia and Europe?
- Industrial development remains focused on high-quality, tech-enabled facilities, with significant interest from the US and Western Sydney for larger projects extending into FY27-28.
- Capital management will rely on partnering all data center developments with institutional investors to maintain low leverage. Strong fundraising progress is being made in Europe and Australia, but regulatory timing may delay announcements beyond the February results.
- Leasing demand is robust across all regions, with major customer deals expected throughout calendar 2026. Positive rental growth and low vacancy rates are anticipated in the logistics portfolio, and further US dual-purpose site acquisitions are planned within six months.
Nanosonics Announces Share Buyback
[9:51 am AEDT] Nanosonics plans to launch an on-market buyback of up to $20 million shares in FY26. This move reflects the company's strong financial position and confidence in its long-term growth prospects.
CEO comment: "The Board is confident Nanosonics has sufficient cash reserves to fund its strategic initiatives, including the continued growth of the trophon business, the controlled market release and broader commercialisation of CORIS, and pursuing selective potential bolt-on acquisitions. The buy-back is a reflection of that confidence and our commitment to delivering long-term value to shareholders."
However, given the company's $1.37 billion market capitalization, this buyback is not considered materially significant. Is this a genuine show of confidence, or a symbolic gesture?
Copper Prices Take a Dive
[9:49 am AEDT] Copper prices experienced a sharp pullback overnight, falling 2.4% to US$4.95/lb. This decline drove the Copper Miners ETF (COPX) down 3.7% to its lowest level since September 29th. What's behind this sudden drop in copper prices? Is it a sign of slowing global demand?
[Copper daily price chart (Source: TradingView)]
Hansen Technologies Expands with Digitalk Acquisition
[9:35 am AEDT] Hansen Technologies has entered into a binding agreement to acquire 100% of Digitalk Group, a provider of Mobile Virtual Network Operator and carrier-grade platforms for the global communications industry. This strategic acquisition aims to strengthen Hansen's position in the communications sector.
Transaction highlights:
- The purchase price is £33.1 million (approximately A$66.4 million), funded through a combination of existing cash reserves and debt.
- Digitalk reported FY25 revenue of £10.5m (over 90% recurring) and Cash EBITDA of £3.3m, resulting in an acquisition multiple of approximately 10x enterprise value to Cash EBITDA.
- Digitalk serves approximately 150 customers across more than 30 countries with solutions that are highly complementary to Hansen's Global Communications Suite.
- The transaction is expected to be immediately EPS accretive.
To provide context, Hansen reported FY25 operating revenue and underlying cash EBITDA of $392.5 million and $93.4 million, respectively.
Overall, the 10x EV/cash EBITDA multiple appears reasonable and should offer mid-single-digit cash EBITDA accretion, excluding any potential synergies. Will this acquisition pay off for Hansen in the long run?
Company page: Hansen Technologies (HSN)
Woodside's Ambitious Growth Projections
[9:28 am AEDT] Woodside is forecasting strong cash flow growth into the early 2030s, driven by a major project pipeline encompassing ammonia, LNG, and oil developments across various regions. These projects are expected to significantly boost the company's financial performance.
- Net operating cash is projected to reach $9 billion by the early 2030s, representing over 6% compound annual growth in sales and cash flow from 2024, with a pathway to a 50% increase in dividend per share from 2032. This is a bold prediction. Can Woodside deliver on these ambitious targets?
- Near-term catalysts include the Beaumont New Ammonia project, expecting first ammonia this year, and the Scarborough Energy Project, on track to begin LNG shipments in the second half of next year.
- Medium-term projects include Mexico's Trion field, targeting first oil in 2028, and Louisiana LNG, targeting start-up in 2029.
- CEO commentary: "Woodside is extracting full value from every asset through safe, reliable operations and a focus on innovation to reduce operating costs and increase efficiencies."
Pexa Reaffirms Guidance After Solid Quarter
[9:22 am AEDT] Pexa's 1Q26 update contained no major surprises, with FY26 guidance reaffirmed. The key figures for the first quarter include:
- Total transaction volumes up 6% year-on-year, indicating continued growth in the property market.
- Total national market penetration was maintained at 90%, demonstrating Pexa's dominant position in the e-conveyancing market.
- The UK business, Optima and Smoove, saw re-mortgage completion volumes increase by 32% and 22%, respectively, suggesting a strengthening UK property market.
CEO commentary: "We delivered a solid trading performance in the first quarter of FY26 across both Australia and the UK. In Australia, property transaction volumes grew 6%, driven by strong refinancing activity. The UK market is gaining momentum, showing clear signs of growth after a period of subdued activity."
Company page: Pexa Group (PXA)
Goodman Group Confirms Strong Performance
[9:13 am AEDT] Goodman Group reported its Q1 FY26 update, highlighting strong operational performance:
- Like-for-like net property income up 4.2%.
- Occupancy at 96.1%, demonstrating strong demand for its properties.
- Assets under management unchanged at $72.1 billion as of September 30, 2025.
- Work in progress of $12.4 billion, with projected June 2026 WIP of over $17.5 billion, indicating significant future growth potential.
- Reaffirmed FY26 operating EPS growth of 9% year-on-year.
CEO commentary: "Logistics customers are focused on significant capital investment in AI and robotic technology, to drive automation and productivity gains. This is particularly evident across larger customers and is likely to continue to see consolidation across the sector into larger, more advanced facilities in prime locations. Combined with minimal vacancy and limited new supply in our markets, this should support future growth and activity."
Company page: Goodman Group (GMG)
Austin Engineering Slashes Guidance: A Troubled Outlook
[9:08 am AEDT] Austin Engineering has announced substantial cuts to its FY26 guidance, citing internal and external factors impacting its business. This is a significant setback for the company.
- Revenue guidance cut to $370-380m vs. prior $390-410m (a 6.2% downgrade at the midpoint).
- Underlying EBIT guidance cut to $30-34m vs. prior $40-46m (a 25.6% downgrade at the midpoint).
The stock is already down 45% year-to-date following a series of negative announcements, including weaker-than-expected FY25 results and previous guidance downgrades. This raises serious concerns about the company's performance.
And this is the part most people miss... This news puts the company in a difficult position, considering it recently launched an on-market buyback of 10% of ordinary shares, citing a strong balance sheet and confidence in long-term growth prospects. How can the company justify a buyback with such a gloomy outlook?
Company page: Austin Engineering (ANG)
Tyro Appoints New CEO
[9:04 am AEDT] Tyro Payments has appointed Nigel Lee as CEO, effective January 12, 2026. Mr. Lee brings extensive experience in the payments industry, having spent four years as Regional Managing Director Asia Pacific and Chief Customer Officer at Ingenico. Can Mr. Lee turn the tide for Tyro?
Company page: Tyro Payments (TYR)
Bluescope CEO to Retire
[8:55 am AEDT] Bluescope CEO Mark Vassella has announced his plans to retire as of February 1, 2026. Tania Archibald, the current CEO of Bluescope's Australian steel products business, has been named as his replacement. Mr. Vassella has been with the company since 2018 and holds a significant stake in Bluescope shares. Will the transition be smooth under Ms. Archibald's leadership?
Company page: Bluescope Steel (BSL)
Vault Transitions to Owner-Operator Model
[8:53 am AEDT] Vault is transitioning its King of the Hills (KoTH) mine to an owner-operator model from January 2027, deploying a larger fleet to support increased mining activity. While the announcement doesn't appear materially significant, it's worth noting that the company reaffirmed its FY26 production and cost guidance.
- The company will deploy two 360-tonne and one 260-tonne excavators, supported by 190-tonne haul trucks, to handle average annual material movements of approximately 14 million bank cubic meters over the Ore Reserve life.
- Vault's FY26 Leonora production and AISC cost guidance remain unchanged, along with the FY27 and FY28 outlook provided in September 2026. Approximately A$2 million in deposits for long-lead fleet items are expected in Q2 FY26 as the company reviews equipment financing and hybrid funding options.
Company page: Vault Minerals (VAU)
Market Correction on the Horizon? Experts Weigh In
[8:51 am AEDT] Brace yourselves! Goldman Sachs and Morgan Stanley CEOs are warning of a potential 10-20% equity drawdown within the next two years. They frame it as a normal bull market correction rather than a structural concern, while highlighting Asia as a key investment opportunity. Are we heading for a market correction?
- Goldman's Solomon projected a 10-20% drawdown sometime in the next 12-24 months, while Morgan Stanley's Pick cited 10-15% pullbacks as healthy and not driven by macro crisis.
- Both executives advise clients to remain invested rather than attempt market timing. Is this sound advice, or should investors be more cautious?
- These warnings follow recent cautions from the IMF about sharp corrections and concerns from Fed Chair Powell and Bank of England Governor Bailey about inflated valuations, amid a relentless global rally fueled by AI gains and rate cut expectations.
- Both firms identified Asia as a bright spot, with Goldman expecting continued capital allocator interest in China, and Morgan Stanley expressing bullishness on Hong Kong, China, Japan, and India based on distinct growth narratives. Is Asia the place to be for investors?
- Morgan Stanley highlighted multi-year investment themes, including Japan's corporate governance reforms and India's infrastructure build-out, while singling out China's AI, EV, and biotech sectors as particularly exciting opportunities.
Source: CNBC
Palantir Shares Dip Despite Strong Earnings
[8:48 am AEDT] Palantir (-7.9%) shares dipped from record highs despite delivering a blowout Q3 result and Q4 guidance, fueled by AI-driven growth across both government and commercial segments. Why the sell-off despite such positive results?
- The company posted a 24% EPS beat (21 cents vs. 17 cents expected) and an 8% revenue beat ($1.18 billion vs. $1.09 billion expected), with total revenue jumping 63% year-over-year and net income more than tripling to $475.6 million.
- Fourth-quarter revenue guidance of $1.33 billion topped the $1.19 billion consensus, while full-year sales expectations rose to $4.4 billion (vs. $4.17 billion ests) despite the ongoing government shutdown potentially threatening key contracts.
- US government revenue surged 52% to $486 million, bolstered by a recent $10 billion Army contract, while US commercial business more than doubled to $397 million, with total contract value for commercial deals quadrupling to $1.31 billion.
US-China Trade: Red Lines Drawn in the Sand
[8:46 am AEDT] China has outlined four red lines following the Trump-Xi trade truce, signaling the fragile foundation of the agreement amid persistent tensions over technology, Taiwan, and structural economic issues. These red lines could easily derail any progress in trade negotiations.
Ambassador Xie Feng identified Taiwan, democracy, China's political system, and development rights as non-negotiable core interests, warning that conflicts over tariffs, industry, or technology "will lead to nothing but a dead end." What does this mean for the future of US-China trade relations?
The trade truce left key issues unresolved, including Beijing's push for access to advanced US semiconductors and American calls for China to rebalance its economy toward domestic consumption to address trade imbalances.
US Government Shutdown: A Record-Breaking Impasse
[8:44 am AEDT] The US government shutdown has now reached 35 days, matching the 2018-19 record, with minimal progress toward resolution. This prolonged shutdown is having a significant impact on various sectors and services.
- Senate Majority Leader Thune expressed optimism for a deal this week involving a House vote on a continuing resolution extending into 2026, while a bipartisan Senate group is discussing a compromise pairing a two-year ACA tax credit extension with income phase-outs. However, Democratic leadership hasn't endorsed the approach, and Republican senators remain divided on the CR.
- Transportation disruptions are intensifying, with nearly 3,000 flights delayed Monday due to air traffic controller call-outs, following Friday's massive delays and 500 cancellations.
- SNAP food assistance beneficiaries are expected to see regular benefits cut in half this month, highlighting the growing impact on social services. How much longer can the shutdown continue before causing irreparable damage?
Risk-Off Sentiment Grips Overnight Markets
[8:42 am AEDT] The overnight risk-off sentiment was largely driven by valuation concerns, amplified by Wall Street CEO commentary and stretched tech multiples. This suggests that investors are becoming increasingly cautious about the market's high valuations.
- Goldman Sachs CEO flagged a likely 10-20% equity drawdown within 12-24 months, while Morgan Stanley's CEO noted expensive valuations but suggested 10-15% pullbacks unrelated to macro events should be welcomed as normal bull market corrections.
- Palantir (-7.9%) emerged as a focal point despite strong earnings, with shares up over 150% year-to-date and trading at an 85x price-to-sales ratio. Is Palantir's valuation justified?
- South Korea's Hynix's 240% one-day rally prompted Korea Exchange to issue an investment caution.
- Valuation scrutiny feeds into broader concerns around Big Tech index concentration, weak/narrow breadth, and potential AI capex bubble risks. Are we in an AI bubble ready to burst?
Why We Sometimes Miss a Day
[8:27 am AEDT] I wanted to give you a quick explanation for the occasional missing days in our blog posts. We're a very small content team, literally just Carl and me. When you don't see a new post, it's usually because I'm either sick, a Melbourne public holiday, or taking annual leave. We are working to improve this and add reliability. Stay tuned for updates.
We're working on some improvements to make things more reliable, including notifications when new posts go live and hopefully adding resources so the blog can keep running even when I'm away. Thanks for your patience, support and understanding.
Good Morning and Market Overview
[8:23 am AEDT] Good morning! ASX 200 futures are up 19pts (+0.21%) as of 8:30 am AEDT. Let's take a quick look at the overnight session:
- Major US benchmarks broadly lower (S&P 500 -1.17%, Dow -0.53%, Nasdaq -2.04%, and Russell 2000 -1.78%).
- Palantir shares dipped ~8% despite blowout Q3 earnings and Q4 guidance, with weakness largely attributed to news that Michael Burry announced 5 million put options on the stock. What does Burry know that others don't?
- Bitcoin down ~6% and hovering around the US$100,000 level, now down ~20% since the October 6th record high and entering technical bear market territory. Is the crypto winter returning?
- Market weakness largely attributed to valuation concerns, with various Wall Street CEOs flagging a potential 10-20% pullback in the short-to-medium term. This is a recurring theme today - are valuations simply too high?
If you’re new to the blog – catch up quick via today’s Morning Wrap: Morning Wrap.
What are your thoughts on today's market action? Do you agree with the warnings of a potential market correction? Are you buying the dip in resource stocks, or remaining cautious? Share your opinions in the comments below!
