Although 2025 started off on a positive note, the momentum behind equities markets was quickly halted by US President Donald Trump and his ‘Liberation Day’ tariffs.
Statistics from the Australian Securities Exchange (ASX) show the total quoted market capitalisation of companies delisted in March 2025 climbed to $3 billion, from $0.5 billion in March 2024.
Thirteen companies delisted in March this year, up from seven in the same month of 2024, taking the total delisted for the first quarter of 2025 to 113.
Listed companies at the end of March numbered 2,092 – a 4.16% year-on-year drop.
The total end of month market capitalisation of all listed companies for March 2025 fell 3.5% from the end of December 2024 to $2.9 trillion, but was up marginally from March 2024.
The first quarter witnessed a slight rise in the total net new capital quoted to $23.8 billion, from $22 billion in the first quarter of 2024.
However, in the month of March total net new capital quoted was negative $0.5 billion versus positive $4.7 billion in March last year.
Since the end of December 2024, the S&P/ASX 200 has fallen over 315 points to end March at 7,843.4 points.
But after Trump last week announced a baseline tariff of 10% on all imports to the US for all countries, and larger-than-expected tariffs on some countries, Australia witnessed the stripping of billions from its main bourse, which is paving the way for a much worse second quarter of 2025.
The fallout of Trump’s tariffs has only been exacerbated by countermeasures announced by countries like China, which has promised to introduce a 34% tax on imports of US goods from 10 April.
Shortly after the opening bell on Monday (7 April), the S&P/ASX 200 tumbled a further 453.2 points, or 5.91%.
Gavin Wendt, resource analyst and founder of MineLife, says markets face a really tough pathway ahead in the near term.
“Markets are being hit by a double-whammy at present – the potential impacts of the tariffs themselves as they are currently presented, plus uncertainty as to what Trump might do next, given his erratic nature,” he tells Mining.com.au.
“Are these tariffs just a bargaining chip, is he prepared to negotiate? We just don’t know.”
While markets were already grappling with the prospect of recession even as Trump took power in January, Wendt believes last week’s events have only served to increase that chance to over 60%.
The average daily number of trades in March jumped 34% year-on-year, with the average daily value climbing 17% to $7.09 billion.
Volatility – measured by the average daily movement in the All Ordinaries Index – registered at 0.7%, versus 0.5% in March 2024. Future volatility – measured by the S&P/ASX 200 Volatility Index (A-VIX) – averaged 13.7 points, which was a 23% increase from March last year.
Also known as the ‘fear’ index, the A-VIX is a real-time volatility index that provides an insight into investor sentiment and expected levels of market volatility.
Australia’s trade ties under threat
While Australia has been hit with a 10% reciprocal tariff, which is at the low end of the scale, it is unlikely to have a major direct impact on Australia’s exports to the US.
That is because Australia does not have a trade surplus with the US, according to CreditorWatch Chief Economist Ivan Colhoun.
“We are not big exporters to the US (around $15 billion last year), so this in isolation is not a big deal for the overall economy – for context, China’s tariffs hit around $30 billion of goods previously and did not de-rail growth – but is obviously important for industries affected,” he said last week.
Of greater concern for Australia is the flow-on effect it will have on Australia from its major trading partners that have been taxed at a much higher rate.
Wendt agrees any impact on Australia’s trading partners will be a negative for the country.
“China and India are the most relevant in terms of Australia’s economic fortunes, as they are the two of the major markets for our commodity exports,” he tells this news service.
“Any hiccups in terms of economic slowdowns in these countries will have a direct impact on our commodity export volumes and prices we receive.”
Chamber of Minerals and Energy of Western Australia (CMEWA) CEO Rebecca Tomkinson also warns that the significant tariffs placed on many of the WA’s key trading partners – including China, Japan and South Korea – may reduce economic output and result in lower demand for the state’s key commodity exports.
“A broader trade war leading to escalating tariffs could substantially damage an economy as trade-exposed as WA,” she says.
Oil and copper are the two commodities likely to be hardest hit.
At the time of writing, crude oil was down around 2.3% to just over US$60 a barrel, while copper was fetching around just over US$4.30 a pound.
“Already we have seen substantial declines in these commodities, with oil already suffering from demand weakness and the return of output to the market via OPEC+,” Wendt notes.
“Copper’s prospects were a lot brighter and prices were at an all-time high, but things have turned around very quickly.”
Australian Prime Minister Anthony Albanese has promised not to slap reciprocal tariffs on US goods coming into Australia, but Wendt warns this could be something the country may need to consider down the track.
“I think it is important for us to have a fallback position in terms of tariffs, which is not to play all our cards at once,” Wendt explains.
“We should pursue the softly-softly strategy at first, given our long-standing closeness to the US, but if all else fails then tougher measures like reciprocal tariffs will definitely be an option.”
With the Australian federal election less than a month out, Wendt says it is imperative that both sides of politics ensure that investor confidence can be maintained in the resources industry post-election and in the years to come during what is likely to be a period of high volatility in the global economy.
“One of the key reasons Australia has been able to avoid recession for such a long period of time has been the strength of our commodity export earnings, which in turn has provided the income for successive governments both Liberal and Labor to fund social programs and stimulate economic growth,” he says.
“Our resource sector has flourished on the back of strong international demand from Asia and the ability of mining companies to continue to operate in a low-risk jurisdiction.”
Gold glimmers in the gloom
However, there is some light in a currently very dark market, and that is the turnaround for the junior gold stocks appears to already be in play.
While there was a temporary pullback in gold price immediately following Trump’s clarification on tariffs, the price of the safehaven metal is again on an upward trajectory.
As of around 1pm (AEST) Monday, gold was selling for US$3,030 an ounce.
While initially it appeared to be just the gold producers enjoying greater interest from investors, Wendt says the turnaround has been in effect since around September last year, with a host of better-quality smaller producers and emerging producers beginning to feel the love.
“In many instances these companies have risen by more than 100% over this six-month period,” he says.
“There is certainly a degree of FOMO (fear of missing out) in the gold sector too on the part of investors.
“Corporate interest is playing its part too, as cashed up producers further up the food chain look to acquire ounces at a discount – but the discount is rapidly receding.”
Major gold miner Gold Fields (JSE:GFI) is raising its stake in small cap Hamelin Gold (ASX:HMG) to 17.7% by taking part in a $2.8 million placement, as reported by Mining.com.au on Monday.
Hamelin Gold has a market capitalisation of $13.3 million currently.
Sophisticated, professional and experienced investors have also committed to participating in the placement, reflecting the rising interest in these gold juniors.
Meanwhile, companies like Northern Star Resources (ASX:NST) is working to get its takeover of De Grey Mining (ASX:DEG) over the line and in mid-March Ramelius Resources (ASX:RMS) made a play for Spartan Resources (ASX:SPR).
Write to Angela East at Mining.com.au
Images:
