The improvement in small resources we have seen this year has been driven in particular by two factors. First and foremost, appetite for gold stocks due to the fantastic margins emerging as a result of a sustained period of cost reduction in the industry, coupled with the fall in the Australian Dollar. The second factor is the interest surrounding the battery thematic, driving share price gains in graphite and lithium stocks. With dozens of new lithium and graphite stocks emerging over the past year, easy money has been made in quality, and some not so quality, names. The gains in these parts of the market have seen institutional and retail investors alike re-evaluate the mining sector with the understanding that the cost reductions seen in the gold sector are occurring across the commodities complex. Added to this is an understanding that falls in some commodities appears to have abated and demand strength is emerging from ASEAN-5 economies.
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