What triggered downward movement of these two ASX shares on Friday?

2 min read | May 03, 2024 06:04 PM AEST | By Team Kalkine Media

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What triggered downward movement of these two ASX shares on Friday? — Image source: © Supparsorn | Megapixl.com

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Two ASX-listed shares concluded the week on a downtrend, diverging from the broader market's upward trajectory. Despite the S&P/ASX 200 Index closing the week with a commendable 0.55% surge to reach 7,629 points, these stocks have failed to emulate the market sentiment. Let's have a closer look into the reasons behind their decline:

Evolution Mining Ltd (ASX: EVN)

Evolution Mining's share price dipped by around 6% and closed on Friday at AU$3.730. The company, along with other ASX gold miners, faced a sell-off on Friday, largely attributable to a recent decline in the price of gold. This downturn in the precious metal's value was triggered by remarks emanating from the US Federal Reserve. Reflecting this, the S&P/ASX All Ordinaries Gold index has also faltered, down by 1.71%, closing the week at 7,460.20.

Gold, often considered a safe-haven asset, typically experiences increased demand during times of economic uncertainty or geopolitical instability. However, its value can also be influenced by a multitude of factors ranging from macroeconomic indicators to geopolitical tensions and even changes in investor sentiment.

Meteoric Resources NL (ASX: MEI)

Meteoric Resources' share price plummeted by around 2% and last traded on Friday at AU$ 0.220. This downturn seemed to stem from profit-taking activities following a substantial gain made by the rare earths developer on Thursday. The surge in price on Thursday was catalysed by the announcement of a non-binding memorandum of understanding with Neo Performance Materials Inc. (TSX:NEO). Per the agreement, once operational, Neo Performance Materials Inc. is slated to undertake the offtake of 3,000 metric tonnes of total rare earth oxide (TREO) annually from Meteoric's Caldeira Project in Brazil.

Despite the broader market's upward momentum, shares of Evolution Mining and Meteoric Resources have encountered headwinds, each for distinct reasons. Evolution Mining faced the repercussions of a weakening gold market, whereas Meteoric Resources NL contended with profit-taking after a notable prior surge. Investors are closely monitoring these developments to gauge their implications and potential future trajectories for these stocks.

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