Most weeks open with a flicker of hope right now. Not because markets are suddenly looking rosy, but because fear has become the dominant trade. The unending Middle East conflict has punters too rattled to hold stocks over the weekend, preferring to sell on Friday and buy back on Monday rather than cop another gut-punch from the world news in between.
In much the same fashion, Wall Street fired up to start the week, with better-than-expected results from SpaceX giving the AI trade another sugar hit. Revenue surged 161 per cent to US$14.6 billion, with a US$4.4 billion profit comfortably beating expectations and helping chip stocks and technology names lead the early charge.
That was about where the good news ended.
The Middle East, oil prices, inflation, interest rates and the looming US midterm elections became too much to ignore, combining to build a wall of worry that even the AI bulls are struggling to climb. Houthi attacks on Saudi targets sent crude surging above US$113 a barrel, reviving fears that another energy shock could reignite inflation just as markets are hoping for interest-rate relief.
Then came the AI sell-down. Early-week optimism evaporated as the Nasdaq surrendered more than 2.5 per cent, with investors suddenly looking less enamoured with the eye-watering cost of the AI arms race. Meta beat earnings expectations but still took a beating as investors baulked at its enormous AI spending bill.
The question is no longer whether AI will transform the world, but whether the mountains of future debt will serve the greater good.
A fresh wave of AI incidents marred the powerful technology this week in what is being called “Black October”, after China-aligned hackers used AI agents to target hundreds of organisations worldwide, in some cases gaining privileged access to cloud infrastructure. Meanwhile, critical flaws in the language behind millions of websites have triggered a global scramble to patch up the internet and exploit attempts have surged into the millions after the vulnerabilities became public.
And with the UK now urging households to stockpile three days’ worth of food and water in case of emergency, the prospect of digital disruptions is spilling into the real world.
Across the channel, the political tinderbox is looking even more primed to blow.
France endured a week of “student” rioting, looting and arson that left thousands of businesses devastated and historic landmarks in ruins . With estimates of a million in protesters littering the streets and billions of dollars in damages across France, the damage bill continues to soar.
Before the dust could settle, the unrest spilled across the border into Italy.
The historically left-leaning citizens of Milan clearly weren’t about to let Paris hog the protest spotlight, with demonstrations of their own turning violent as hooded protesters clashed with police.
The financial fallout is just as ugly. France’s 10-year government bond yield surged above 5 per cent, while the gap between French and German 10-year borrowing costs ballooned to nearly 1.8 percentage points — leaving France paying more than 50 per cent above Germany’s yield. That is the widest spread since the 2011 Eurozone debt crisis, as investors demand a much fatter return to lend to a country increasingly beset by fiscal strain, political paralysis and civil unrest.
The problem is that France’s already enormous debt pile is becoming even more expensive to service, leaving less room to manoeuvre and making another Eurozone debt crisis look harder to dismiss. France spends around 30 per cent of GDP on social programs and carries one of Europe’s heaviest tax burdens.
Taxing your people into oblivion, pile on the govt spending and cripple small businesses. Sound familiar?
Welcome to Albo’s Australia, where the looming capital-gains tax changes are already crippling investment and the ASX Emerging Companies index (XEC). The XEC has puked its guts out this week, losing more than five per cent in five days and down some 15 per cent over the last month.
Australia’s AI industry and its supportive cheer squad have also been wetting the bed following Firmus’ spectacular failure to launch. The proposed $44 billion valuation behind the data-centre hopeful’s planned float proved too much for public markets to swallow, as its Aussie compatriot NEXTDC was next in the firing line this week.
The data-centre giant shed 42 per cent on Wednesday, wiping roughly $3 billion from its worth after delays to electricity network upgrades at its West Footscray site forced it to slash forecasts and put new developments on ice.
With small caps taking another hiding, this week’s Runners list is predictably a short affair. Top spot went once again to an Israeli technology angle, with Aussie tech hopeful inking a deal with Israeli heavyweight SYNCH that could pave the way for up to US$10 million in purchase orders for its next-generation smart glasses.
ENERGY TECHNOLOGIES LTD (ASX: EGY)
Up 315% (2c – 8.3c)
Bulls N’ Bears Runner of the Week is smart-wearable player Energy Technologies, after its wholly owned Cogenic subsidiary signed a binding heads of agreement with Israeli tech outfit SYNCH, opening the door to a potential US$10 million (A$14.25 million) order for its next-generation smart glasses.
SYNCH is a wholly owned subsidiary of defence heavyweight Elbit Systems, a major supplier of land equipment and unmanned aerial vehicles to the Israeli military, so this is a foot in the door of the defence and frontline communications market.
The one-year framework kicks off with a paid US$250,000 proof-of-concept involving 10 field-operational units and if the trial goes well, SYNCH can place orders worth up to US$10 million over the following year.
Cogenic’s tech is targeting the “overloaded operator”, frontline personnel juggling a radio, tablet, body camera and data terminal while struggling to keep their eyes on the action.
Its lightweight wearable packs a heads-up display, two-way comms and body-worn video into one package. The clever bit is the proprietary laser beam-scanning and MEMS technology, which delivers a display readable in direct sunlight without draining the battery, keeping information in front of your eyes and hands free for soldiers, police, and emergency crews alike.
Cogenic already earns a five per cent royalty through its master licence agreement with Amalgamated Vision on retinal display technology supplied to programs with the US Air Force and NASA; however, the SYNCH deal is direct hardware sales, a step from collecting royalties to supplying its own kit at scale.
The end customer is staying under wraps for commercial reasons, but applications stretch across homeland security, law enforcement, medical first response and military operations.
Cogenic reckons it can build the first 10 trial units within 12 weeks of receiving final specs, and ramp to as many as 1,000 units every 10 days at full capacity if orders flow. Management puts an illustrative addressable market at around US$42 billion, though turning a slice of that into revenue depends on successful trials and further orders.
The market liked what it saw, sending shares up as much as 315 per cent on the week, a price not seen since 2022. The trial still has to deliver, but for now Energy Technologies has shareholders looking through rose-coloured glasses.
RAS TECHNOLOGY HOLDINGS (ASX: RTH)
Up 133% (0.6c – 1.2c)
Snagging silver on the week was global racing and wagering leader RAS Technology Holdings, after it inked a binding scheme implementation deed to be acquired for $1.04 in cash by UK-based The Press Association Limited.
The operator and data provider Racing and Sports has agreed to a $49.8 million cash takeover by UK-based The Press Association, a subsidiary of PA Media Group.
The Press Association proposes to acquire every issued RAS share under a binding scheme implementation deed, with completion expected in February 2027.
The proposed acquisition offers shareholders $1.04 per share, or a valuation of nearly $50 million, representing a 93 per cent premium to the company’s trading price.
RAS co-founders Gary Crispe and Robert Vilkaitis, who together hold or control approximately 34 per cent of the company, have confirmed their intention to support the deal subject to the same qualifications applying to the board.
It also fits neatly with what RAS does best. The operator of Racing and Sports provides racing data and wagering technology. The Press Association brings more than forty years of racing heritage and a long record of working with rights holders to promote the sport.
The two businesses’ strengths and global reach are complementary, so customers get a wider range of data, deeper wagering knowledge and coverage across more of the markets each operates in.
The Press Association’s racing heritage spans more than forty years, with a long-standing history of working closely with rights holders to promote horse racing.
With the Cox Plate heading to Flemington for the first time in its more than 100-year history, there’s no shortage of high-stakes action on and off the track this week. And while the thoroughbreds battle for racing’s big prize, the ASX has a little fight left in it for backing winners and taking a Blind Raise on the next big thing.
TAMBOURAH METALS LTD (ASX: TMB)
Up 81% (3.1c – 5.6c)
Taking out the final place on the podium was plucky junior goldie Tambourah Metals, after a fresh round of assays from its Bryah gold projects in WA returned spectacular high-grade hits at the Baxters South prospect.
Drilling at Baxters South returned 4m at 41.7g/t gold from 55m in the weathered zone, including a jaw-dropping 1m at 146.5g/t. Then came the sting, with a promising primary discovery in fresh rock of 3m at 35.5g/t from 169m - seemingly directly below the shallower hit.
Shallow gold is nice, but gold in fresh rock makes an explorer’s ears prick up, hinting the system goes deeper. Nobody knows yet which way it’s pointing, but that’s the kind of problem explorers love.
For a company built around gold exploration, it’s the right kind of surprise. Baxters South sits within the 467 square kilometre Bryah project in WA’s Murchison region, about 160km north of Meekatharra and handy to the Harmony gold deposit.
Beatty Park South, the flagship that previously produced 6m at 25.8g/t, including 1m at 126g/t, was the quieter sibling this time, and the company’s East Pilbara project near Marble Bar covers the historical Tambourah goldfield.
Meanwhile, Tambourah is in the middle of a $2.2 million non-renounceable entitlement offer at 3.5c, with a free 6c option for every two new shares subscribed.
Convenient timing, then.
A great week for the share price and an even better one for a company that’s currently passing the hat around. And with the 250,000-ounce Harmony only 4.3km up the road, the market can be forgiven for dreaming.
Is your ASX-listed company doing something interesting? Contact: matt.birney@wanews.com.au