Weekly Wrap: Our Top Stock Picks Drop, Gold Soars on Trump Tariffs & Small-Caps Eye Opportunity
Our Top 10 picks become our most-read piece ever, gold hits record high on Trump's tariff announcement, and what it means for ASX explorers in 2025
Our Top 10 ASX Stocks to Watch in 2025 dropped this week and quickly became our most-read article ever. Perfect timing too, with gold soaring past US $2,800 an ounce and Trump's tariffs about to shake up global trade, 2025 is already serving up some interesting opportunities for ASX small-cap investors.
In this week's wrap, we'll cover:
Why we're watching those 10 stocks for 2025.
Gold's price surge and its impact on junior explorers.
Junior explorers - who's drilling and who's waiting for better days
Let’s get into it.
Our 2025 Stock Picks: Why These 10 Caught Our Eye
After digging through hundreds of ASX small-caps this week, we picked out ten companies we think could run hard this year.
These stocks span multiple commodities - gold, copper, lithium, and even natural hydrogen - each with a compelling investment case.
We found companies with small valuations that, with good news, could provide shareholders with returns many multiples of their initial investment.
Among our picks:
Top End Energy (ASX: TEE) holds prime Kansas real estate in the natural hydrogen race, which is heating up. While billionaires like Gates, Bezos, and Twiggy Forrest (who recently hinted at 'a new form of hydrogen' coming to market) back Top End’s neighbours, TEE sits on similar ground at just a $25 million market cap. With $6 million fresh in the bank, they offer serious leverage to this emerging sector.
Bubalus Resources (ASX: BUS) first caught our eye for one simple reason - location. They're sandwiched between two of Australia's highest-grade gold mines in Victoria, and the drills start turning very soon. At a $7 million market cap, any decent hit could send this one flying.
Ronin Resources (ASX: RON) is an early-stage gold and copper explorer in Argentina. The new president has thrown open the doors to miners, and some serious industry players are already backing this one. Early days, but the ingredients are there for something special.
Want to see who else made the cut? The full list is here.
Gold at Record Highs: What It Means for Junior Explorers
Gold prices are making headlines again, recently hitting an all-time high just as Trump confirmed he's slapping 25% tariffs on Canadian and Mexican imports starting today. China's not escaping either, copping a 10% hit across the board.
While oil might get a reprieve, these tariffs will shake up nearly US $1.6 trillion in North American trade.
Markets hate uncertainty, and Trump's just delivered it in spades. Justin Trudeau's already talking retaliation, Mexico's not happy, and China's on-off relationship with Trump just changed to ‘it’s complicated’.
The gold story runs deeper than just Trump, though. US interest rates are likely to head down, central banks are loading up, and China's buying more than ever. Even the London gold market is seeing unprecedented action, with reports of a month-long queue to access gold at the Bank of England due to traders rushing physical gold to New York ahead of potential tariffs.
What's driving gold right now:
Traders are betting on many potential rate cuts from The Fed in 2025. When rates drop, gold typically rises.
Central banks are buying gold hand over fist, setting record after record. When the big boys are buying, it's worth paying attention.
Money's flowing back into gold ETFs, reflecting renewed investor interest in the metal amid concerns over inflation and geopolitical instability.
China's appetite for gold keeps growing - they're importing more than ever as they look to hedge against currency fluctuations.
What this means for junior gold companies:
Higher gold prices naturally mean higher valuations for companies with strong projects. Any junior that proves up a high-grade deposit right now could soon have majors knocking at their door looking to invest or take over.
Rising gold prices mean greater M&A activity – Major miners are always on the lookout for high-grade projects, and with gold prices at all-time highs, well-positioned juniors could become prime takeover targets. The $5B acquisition of De Grey Mining (DEG) last year is a perfect example.
Market mispricing of junior hgold stocks – While gold prices have surged, many ASX-listed junior explorers are still trading at low valuations due to broader market conditions. It’s a rare chance to pick up quality assets before sentiment shifts.
The Bottom Line: With gold at record highs and all signs pointing to further strength, the stage is set for junior explorers in 2025. The formula is pretty simple - juniors with good ground, active drill programs, and any sign of high-grade gold could see their share prices move substantially. The majors need new deposits, they're cashed up, and they're willing to pay up for quality.
Australia's Mining Sector: A Tough Year for Juniors, but a Shifting Landscape
S&P Global's latest report on Australian exploration tells an interesting story. Overall spending dropped 10% year-over-year in 2024, but dig deeper, and it gets more revealing:
Junior exploration budgets fell 15%, dropping below the US $1B mark for the first time in years.
Grassroots exploration spending fell 22%, with the capital being redirected toward mine-site expansion rather than early-stage discoveries.
Basically this means we're not finding enough new deposits to replace what we're mining. Simple maths says we'll need to drill more in the future just to keep up. When that happens, the money tends to flow back to juniors.
The Takeaway: The financing environment remains challenging for small-cap explorers, but those with substantial projects in gold, copper, or energy-related could attract further interest in the coming months.
Final Thoughts: What Investors Should Be Watching
After a challenge 2024, pockets of real value are emerging in the small-cap space. Our Top 10 picks for 2025 come after months of research, looking for companies with both the right projects and perfect timing.
Gold breaking records certainly helps the case, particularly for explorers with drill rigs turning in tier-one Australian territory. But beyond the gold story, we're seeing quality projects across several commodities trading at prices that make compelling investment cases.
Stick with us - this year is already serving up some interesting opportunities. From what we're seeing in the response to our Top 10 list, plenty of other investors are starting to notice too.
We'll be closely monitoring these trends in the weeks ahead. If you want deep-dive insights into the ASX small-cap space, make sure you're subscribed to Equities Club for expert coverage.
Merger and Acquisitions - https://www.mining-technology.com/data-insights/australia-m-a-activity-mining-industry/