WA Index

The market capitalisation of Western Australian listed companies retracted by 3.7% over the month of January 2022, to close at $307.6bn. The decline was in alignment with most global markets, which all experienced pull backs in the first month of the new year, apart from the FTSE 100, which saw modest growth of 1.1%.

The tampering of bond buying programs and talks of interest rate hikes by central banks across the globe were the primary reasons for these systematic declines, as well as continued uncertainty regarding the impact of the COVID-19 Omicron variant and rising tensions in Eastern Europe and the Ukraine.

Download the list of WA’s top 100 listed companies, as of 31 January 2022, explore the sections below and if you do not currently receive our WA Index, please register to be added to our distribution list.

Highlights:

• Commodity review
• Performance of WA Index and global indices
• WA Index movement
• Top performers of the month.

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

Commodity Review

Coal, lithium, iron ore, crude oil and LNG were the biggest movers in January – with zinc and cobalt and gold remaining flat.

• Coal prices increased by 46%, to close at US$203.5/T, due to the ban imposed by the world’s largest exporter Indonesia on thermal coal exports as a response to low coal stocks in its domestic power plants. In addition, there was an increase in demand of coal by the EU, and fears of natural gas supply impacts, amid the ongoing tensions between Ukraine and Russia.
• Lithium prices increased considerably – by 35%, closing at US$48.5/KG – as a result of continued high demand for lithium batteries related to the electrical vehicle market (up 160% during 2021). Environmental requirements that impacting extraction of the mineral are also further driving up the price.
• Iron ore’s price continued its recovery in early 2022, rising by 21% to close at US$148/T, primarily due to an increase in demand from primary consumer, China, as well as production issues experienced in Brazil. Due to ongoing COVID-19 Omicron impacts in Australia, local miners have also warned of the consequences of labour shortages on production.
• Crude Oil prices increased 16%, closing at US$90.01/BBL, the biggest monthly increase in seven years, with global concerns about Russia/Ukraine tensions disrupting supplies in 2022.
• LNG prices fell due to lower demand from Asia compared to previous months. Prices closed out at US$26.8/MMBtu, a 12% decrease throughout January 2022..

Performance of WA Index and global indices

WA Index movement

Top performers of the month

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

• Woodside Petroleum Limited experienced the only notable increase for Top 20 companies during the month – of 15% and following a continued surge in global oil prices and the announcement of the sale of 49% of Woodside’s non-operating participating interest in the Pluto Train 2 Joint Venture to Global Infrastructure Partners (GIP).
• Fortescue Metals Group Limited saw an increase of 3% in market capitalisation, mainly on the back of the release of its Q2 production results which reported 47.5mt of ore shipped during the quarter, leading to its highest ever half-year total shipment record of 93.1mt. Improved iron ore prices also contributed to the increase.
• IGO Limited’s market capitalisation grew by 2%, following the release of its Q2 results which included NPAT of $38.4m, up 36% on the previous quarter, primarily due to a 56% uptake in profitability from its Lithium JV as lithium prices continued to surge.

The top Deloitte WA Index Movers and Shakers in January were:

• 88 Energy Limited saw an increase market capitalisation of 64% on the back of announcing its commencement of the Merlin-2 appraisal well activities, and its successful application in joining the OTCQB Market in the United States. The Merlin-2 well is expected to be one of the high-impact wells in oil and gas investments, and investors are hopeful of a positive outcome over the coming year.
• Global Lithium Resources Limited’s market capitalisation rallied by 60% over the month, after two new and experienced senior executive and board appointments. The company’s prospects also continue to benefit from record high lithium prices.
• European Metals Holdings Limited showed a substantial 26% growth in its market capitalisation over January after a positive update from the completion of a pre-feasibility study into the backfilling potential of its Cinovec mine.

If you don’t currently receive our WA Index, you can register to be added to our distribution list.

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