Insights

Why is the Core Lithium (ASX:CXO) share price surging 15% today?

The lithium player is charging higher today.
The post Why is the Core Lithium (ASX:CXO) share price surging 15% today? appeared first on The Motley Fool Australia. –

The Core Lithium Ltd (ASX: CXO) share price is surging 15% higher today and currently trades at 48.5 cents apiece.

Shares in the lithium explorer have now rallied 21.5% in the past week, against a backdrop of strong commodity markets and recent project developments.

While there has been no market sensitive information for the company today, it’s worthwhile diving a little deeper to understand what’s behind the gains today.

Why is the Core Lithium share price climbing 14%?

News last month that the company made its final investment decision regarding the Finnis Lithium Project wasn’t enough to spike Core Lithium’s shares at the time.

The company expects the maiden production of lithium to commence by the end of 2022 and the project is fully funded after recent injections of capital.

Its shares traded sideways until the start of October when investors began bidding up their price again.

One factor that could be lighting a fire under the Core Lithium share price is the premium that lithium is fetching in the spot and futures markets.

Lithium shares have been hot contenders on the ASX this year with lithium prices soaring more than 300% in the last 12 months to now trade at A$34,882.35/tonne.

Lithium contracts popped again in August. At this time, the rate of change triggered another 100% jump in pricing to reach all time highs of A$37,630.66 just two days ago.

This was after an 8% jump over the weekend to roll into the start of trade on Monday.

Core Lithium’s exposure to the silvery-white metal means that its share price can and does fluctuate with volatility in the broader commodity markets.

That’s because it is a price taker that must accept the going rates for the markets it sells into. As much is true for all ASX resource companies that produce a commodity.

With this in mind, it makes sense as to what might be fuelling investors’ buying activity today.

And the strengths appear to be carried through the broader sector as well. The Battery Tech & Lithium ETF (ASX: ACDC) – a good proxy to gauge growth in the industry – is also climbing 1.2% higher so far today.

Core Lithium share price snapshot

The Core Lithium share price has soared this year to date, posting a gain of 234% since January 1.

This extends its gain over the past 12 months to 870%, a whole solar system away from the S&P/ASX 200 Index (ASX: XJO)’s return of about 20% in that time.

The post Why is the Core Lithium (ASX:CXO) share price surging 15% today? appeared first on The Motley Fool Australia.

Should you invest $1,000 in Core Lithium right now?

Before you consider Core Lithium, you’ll want to hear this.

Motley Fool Investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now… and Core Lithium wasn’t one of them.

The online investing service he’s run for nearly a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.* And right now, Scott thinks there are 5 stocks that are better buys.

*Returns as of August 16th 2021

More reading

Own ASX lithium shares? Here’s what the IMF is predicting for the sector

ASX lithium shares lift as spot prices hit all-time highs

Here’s why the Core Lithium (ASX:CXO) share price is lifting today
Core Lithium (ASX:CXO) share price lifts amid bosses’ optimistic outlook
ASX lithium shares are rallying across the board today. Here’s why.

The author Zach Bristow has no positions in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

Trade The World Anywhere & Anytime!

Mobile app platform with over 50,000 global listed securities across 12 markets (over 70% global market capitalisation), right from your Android or iOS device.

Integrated with exclusive trading idea and investment analysis tools to help you find actionable insight on virtually every financial instrument across our 12 global markets, to help you optimise your trading strategies.

Refer Your Friends

Tell your friends about Monex and gift them FREE access to our trading tools.

We respect your privacy and will only send this one email notification to your friends. 

Share With Your Friends

Share on facebook
Share on twitter
Share on linkedin

Monex Trading Tools Access and Usage Terms

The Monex Trading Tools (referred to as ‘tools’ hereafter) are available to you inside your client portal;


To activate access to the tools, you must have a verified and approved trading account and have made a deposit of at least AUD $1000.


An active and funded account with a positive trading balance is required to continue to have access to the tools;


Although the tools are available to you indefinitely, Monex Securities may at it’s discretion disable access to the tools in the future;


Monex securities reserves the right to change these terms and conditions from time to time, as it sees fit, without notice.

Important Notice
iOS & Android App - 12 International Markets & Over 70% Global Market Cap. $0 Brokerage On US Trades. Click Here!