Weekly Wrap: Tariff Tremors, Gold's New Heights, and Mining's Political Poker
Tariffs trigger market meltdown, gold breaches $3,100, mining takes centre stage in election campaigning, and Fink sees $68 trillion infrastructure need ahead
Just when we thought markets were finding their footing, the ASX took a nosedive.
What a week it's been. The brutal reality check hit every sector, but miners copped it particularly hard as Trump's new tariffs, wild swings in commodity prices, and the election circus combined into a perfect storm.
Here's what we're unpacking this week:
Why the ASX had its worst week in years
Gold price hit yet another all-time high
Bubalus Resources raises $1.5 million to explore for gold
Top End Energy drops its investor presentation
The Australian election developments and what it means for miners
Let's get to it.
ASX Market Collapse: Causes and Short-Term Outlook
The ASX took a serious beating this week, with Friday's 2.4% drop on the S&P/ASX 200 capping a 3.9% weekly decline. It’s the worst we've seen since mid-2022.
That's nearly $70 billion vanishing from the All Ords in just five trading days.
Trump's well-publicised tariff announcement was the obvious trigger, but China's swift retaliation was the knockout punch. Beijing's 34% levy on all US goods sent tremors through global supply chains that quickly reached Australian shores.
Australia now finds itself caught in a crossfire between our largest security ally and our largest trading partner. With recession talk gathering steam globally, many investors simply decided this wasn't the week to be a hero. Resource stocks, which are usually our market's backbone, couldn't escape the carnage.
Looking ahead, expect more volatility as the market comes to grips with the implications of the tariffs and monitors potential retaliations from affected countries.
Multiple interest rate cuts are now on the table for 2025 as they try to cushion the blow. The market's already pricing this in, so the only question is how soon the first cut comes.
Implications for Junior Mining Stocks
While markets were busy having a meltdown over Trump's tariffs this week, BlackRock boss Larry Fink quietly dropped his annual letter to shareholders, and it's worth a read.
The world's largest asset manager is eyeing something rather substantial beyond the immediate chaos, a mind-boggling $68 trillion infrastructure build needed by 2040, according to data from the Global Infrastructure Hub and Deloitte that Fink cites in his letter.
For perspective, that's like rebuilding Australia's entire national highway network plus all our major ports, airports, and power grid every month for the next 15 years.
BlackRock is already positioned for this thesis, having recently acquired Global Infrastructure Partners. For ASX small-cap explorers sitting on critical minerals, the implications are substantial once markets stabilise.
Copper gets special attention in Fink's outlook, with the red metal central to his electrification vision. He highlights how a single AI data centre can consume as much electricity as a mid-sized city. Thousands of these power-hungry beasts are being built globally, creating solid demand for energy metals regardless of short-term market rollercoasters.
The permitting observations caught our eye. Fink notes it takes 13 years to approve a high-voltage power line in the US, while China sorts it in "a quarter of the time." Our more streamlined Aussie approval processes (yes, they could still be better) might actually become a competitive edge as the West races to catch up on infrastructure.
Ray Dalio also weighed in on the tariff drama this week. The billionaire investor suggested these trade barriers could accelerate "resource nationalism" - potentially strengthening the hand of ASX small-caps with advanced critical mineral projects.
Western nations desperate to break China's supply chain dominance might suddenly find friendly-jurisdiction Australian deposits rather attractive.
So, for those looking at red screens and doom-scrolling X this week, this is a reminder that the infrastructure cycle remains intact. As one veteran broker rather aptly put it on Friday: "It's going to turn into a fabulous buying opportunity at some point, but it's not today."
Gold Price Trends and Prospects for Junior Explorers
Gold continues its relentless march upward amid the uncertainty, smashing through US$3,100 per ounce this week. It feels like we've written that same line a dozen times since January, but the momentum doesn't seem to be fading despite everything else happening in markets.
For Aussie gold bugs, the weakening dollar delivered an extra bonus, pushing the local price above A$5,000 per ounce.
Global central banks keep hoovering up the yellow metal at record pace, and The World Gold Council sees plenty more upside ahead, citing sustained central bank buying and a global environment that's tailor-made for precious metals.
Junior gold explorers are quietly smiling. Higher gold prices mean better economics on exploration projects, and when gold runs like this, exploration plays typically get a second look from investors.
Bubalus Resources Cashed Up For Drilling
Still on the topic of gold, Bubalus Resources (ASX: BUS) locked in a $1.5 million placement to help fast-track its upcoming drill campaign in Victoria.
With both gold and antimony prices on the move, Bubalus is one of the few juniors who have real exposure to both.
The funds will go straight into the ground, starting with drilling at Crosbie South later this month, an area that's already shown strong surface results and sits right in the heart of Victoria's gold-antimony corridor.
Worth noting that the raise was done at 16.5c. The closing price on Friday was 15.5c, meaning you're now able to buy at a discount to what the institutions, sophisticated investors, and even the MD Brendan Borg himself, who all bought in at 16.5c in the raise.
With drilling set to begin shortly, they're flying well under the radar despite the proximity to two major gold operations.
Bubalus now sits with a sub-$10M market cap at 15.5c per share. The company has over $4 million in cash and multiple shots on goal in a region that's been quietly delivering for smart explorers.
Top End Energy Presents
Top End Energy (ASX: TEE) dropped its investor presentation this week, giving investors a clear look at just how strategic their natural hydrogen land position really is.
Their 25,000-acre package (soon to be 30,000) sits right between Koloma's established projects in Kansas. Looking at the map from the presentation, TEE has positioned themselves in the same fairway where Koloma, backed by Bill Gates and Jeff Bezos money, has already sunk multiple wells after raising US$400 million.
TEE's "fast follower" approach is designed to compress years of development into a short window. With its first well-site selected and fully funded pre-drill activities underway, the pace is picking up.
Kansas already hosts a multi-billion-dollar hydrogen industry driven by ammonia and industrial production. TEE doesn't need to create demand. They just need to deliver supply.
Add in their exposure to the Beetaloo Basin in Australia, which is a rather handy de-risked asset with gas discovery potential, and you've essentially got a two-for-one deal with the potential for serious leverage.
Political Showdown: Mining Votes Up for Grabs
Meanwhile, the federal political circus rolled into WA's mining heartland this week. Both major parties were out in force, dangling carrots (and quite a few funding promises) in front of resource companies.
Peter Dutton touched down in Perth with a $100 million pledge tucked in his pocket, a revival of the Junior Minerals Exploration Incentive that went missing from Labor's recent budget.
For ASX-listed explorers burning through cash to find the next big discovery, this could be a welcome lifeline.
Dutton was paraded around a drilling yard in WA, even sitting in the controls of a drilling rig (though wisely advised not to push any buttons). All part of the theatre of being seen as mining's best mate.
Meanwhile, Albanese is reportedly crafting plans for a strategic critical minerals reserve. Essentially, this means the government stepping in as a buyer of last resort for producers.
Word is the model could mirror what CBH does for grain farmers - paying producers upfront while the government either flogs it overseas or stockpiles it for a rainy day.
For juniors transitioning to producers, having a guaranteed buyer would certainly ease financing conversations.
Albanese is also today expected to announce a $2.3 billion home battery subsidy. With plans for a million new batteries by 2030, this should boost demand for battery metals. Local lithium and nickel explorers might find new customers closer to home.
With the May 3rd showdown approaching, these competing visions for the resource sector highlight just how crucial mining votes have become.
The policy choices matter for dozens of explorers whose share prices could swing on whether these promises materialise.
The Wrap
This week was a clear reminder of just how tightly global events are linked to what happens in the Aussie market, especially in mining.
For those looking through the current volatility, quality assets and strong balance sheets remain the north star. Staying across geopolitical moves, shifts in commodity prices, and election promises will be crucial.
Sometimes, the best move is patience - backing solid companies with a strong cash position and waiting for the market to come to you.
