Note from the MD: Technology, lithium stocks rise as climate policy debate heats up

Under most circumstances, discussing the weather is considered something of a faux pas committed by only the poorest of conversationalists, but in the past few weeks it has dominated the national conversation.

Under most circumstances, discussing the weather is considered something of a faux pas committed by only the poorest of conversationalists, but in the past few weeks it has dominated the national conversation.

I’m not referring to the rainy Spring weekends we’ve had down here in Melbourne.

No, I’m referring to the fierce debate around Australia’s climate commitments, which came to a head yesterday when the Coalition revealed their plan to reach net-zero emissions by 2050.

The “technology, not taxes” approach outlined by the Federal Government looks to leverage innovation while trying to balance the economic impact of a sweeping energy transition and keep power affordable.

Personally, I haven’t had time to read the government’s 129-page plan in full, and though it has already attracted its fair share of detractors, it will be interesting to see how markets and investors adapt to it.

At any rate, technology stocks were some of the best performers on the market yesterday, as were lithium miners – lithium of course being used to manufacture batteries needed for a zero-emission economy,.

Gains in the lithium sector were led by Pilbara Minerals, which yesterday sold 10,000 tonnes of spodumene at auction for a record price of $US2,350/t.

The company’s previous auction netted an almost-as-incredible $US2,240/t and was credited with single-handedly triggering an 86.5% month-on-month increase in the industry-wide average spodumene price.

The XJO index has traded slightly higher over the past week but is now feeling strong resistance at the 7465 level. The market has tested this resistance level for three days in a row. Price action has been maintained above the 50-day MA and 7400 levels. We will be expecting price action between 7400 and 7465 over the short term, potentially making a break to the upside over the next week.

Of course, we think there’s plenty of potential in the tech sector even outside of the climate transition. Reach Markets is keenly watching the evolving Internet of Things (IoT) space as we emerge from this pandemic. Tomorrow at 11am (AEDT), I will be joined by CEO Mario Vecchio from TZ Limited (ASX: TZL) – an Australian IoT business that is solving real-world problems around access and control of physical spaces, with a large and growing pool of A-list clients, including Google, Apple, Microsoft, Netflix, UPS and Westpac. Register to attend here.

Mario will be discussing how TZ’s market-leading software is positioned as an IoT category leader, and how the shift to a SaaS model helped the company to significantly increase its pipeline and target higher recurring revenue growth. Book here.


ABC News, Debate over net zero in Australia is heating up as calls for more climate change action grow. Here’s the background Prime Minister of Australia, Australia’s Plan to Reach Our Net Zero Target By 2050 The Guardian, Australia commits to 2050 net zero emissions plan but with no detail and no modelling The Sydney Morning Herald, Economists warn against the $20b technology bet at heart of net zero policy CommSec, Evening Report BBC, The new ‘gold rush’ for green lithium BBC, The batteries that could make fossil fuels obsolete Stockhead, Pilbara Minerals just sold the most expensive cargo of lithium spodumene ever

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