Here's why Core Lithium (ASX:CXO) shares gained 422% in a year

3 min read | May 27, 2022 07:06 PM AEST | By Ritwika

Here's why Core Lithium (ASX:CXO) shares gained 422% in a year — Image source: © Malpetr | Megapixl.com

Highlights

Core Lithium garnered investors' attention on the ASX today.

The rising prices of lithium come as a ray of hope to investors.

The lithium stocks on Wall Street also closed strong after an overnight trading session on 26 May.

The shares of Core Lithium Ltd (ASX:CXO) closed 1.953% higher at AU$1.305 per share on the ASX today (27 May). More than 18 million shares of Core Lithium were traded during the entire trading session on the ASX today.

The share price of Core Lithium has gained by 422% on the ASX over the past 12 months. On the other hand, Core Lithium's year-to-date share price also gained over 107% on the ASX today (27 May).

What pushed Core Lithium's share price on the ASX today?

Core Lithium ended the week on a positive note this week despite any significant updates in recent times. There could be several factors responsible for Core Lithium's upward march on the ASX today.

Also read: Here’s why Core Lithium (ASX:CXO) shares close over 8% strong today.

The first and the foremost factor could be the ASX200 Materials sector which closed on a positive note today. The S&P/ASX 200 Materials sector (ASX:XMJ) closed 1.489% higher at 17594.7 on the ASX today (27 May).

As a result, not only Core Lithium but many other lithium stocks such as Pilbara Minerals and Vulcan Energy closed in green today.

The next factor that has influenced the share price movement of Core Lithium on the ASX today could be the prices of Lithium. Lithium prices are skyrocketing as the demand keeps increasing globally due to the development of electric vehicles.

To comment on the rising lithium price, The Benchmark Mineral Intelligence said that the cost of lithium could add up to US$1000 to the price of a new car.

In addition to that, there have been rumours that the lithium supply won't be able to keep up with the demands, which might further give rise to a price surge for a longer period of time. Investors are seeing it as a ray of hope.

Another factor that could be responsible for the share price gain of Core Lithium on the ASX could be the performance of lithium stocks on the New York Stock Exchange (NYSE).

The NYSE-listed lithium giants such as Albermarle, Livent and SQM closed even stronger on the NYSE last night (26 May) as the risk sentiment improved significantly.

Image source: © Sukmaraga | Megapixl.com

About Core Lithium:

Core Lithium Ltd is an ASX-listed lithium producer with a market capitalization of AU$2.21 billion. The company is mainly involved with the operations of the discovery and exploration of mineral deposits in the Northern Territory and South Australia. The company was established in the year 2010 with its headquarter in Adelaide, South Australia.

Also read: SYA, CXO, PLS: Why are these ASX-listed lithium stocks in news?

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