London’s AIM junior market this week bounced back to its pre-coronavirus pandemic highs, outpacing the big caps.
The best-performing sectors over the period have been alternative energy, mining, leisure goods, pharma and retail, while the top three stocks were Novacyt SA (up 4,123%) and Synairgen PLC in healthcare (up 2,385%) and B2B music services company 7Digital Group PLC (up 1,036%).
“AIM has proved to be remarkably resilient and adaptable in the face of the turbulence affecting global stock markets and its impressive recovery has helped cushion investors from the worst impacts of the downturn,” said Scott Knight, head of audit at City auditor BDO, who noted the FTSE 100 is still 19% below its pre-pandemic level.
“AIM companies haven’t always been popular among investors, but recent improvements in reporting and corporate governance have helped drive confidence and promoted the market’s role as an essential venue for investors looking to deploy risk capital.”
This week the AIM-All Share index and the FTSE 100 level-pegged as they both rose 1.8% to 982 and 6,012 respectively.
Among the winners, both before and after lockdown, has been Russia-focused Eurasia Mining which continued its good run this week, jumping 31% higher to 35p.
Good is perhaps an understatement, considering the palladium miner was trading at 0.4p just a year ago. With the stock rocketing by an impressive 7,766% since then, the company is now valued at £970mln.
Mergers and acquisitions officer Dmitry Suschov and executive chairman Christian Schaffalitzky must have been delighted, considering their respective stakes of 16.88% and 3.25% in the firm. Their holdings are valued respectively at £162mln and £31mln at current market prices.
A look at the shareholder register shows that 45mln share options have been set aside for Eurasia Mining directors, while 85mln have been earmarked for advisors and staff. Were they to vest today the combined option pot would be worth over £15mln.
The junior market saw a flurry of oil and gas news during the week, perhaps signalling some return to sector activity after months of crisis.
Volga Gas PLC (LON:VGAS) advanced 10% to 26p after unveiling the potentially significant discovery of a new oil field in Russia.
Also in Russia, PetroNeft Resources plc (LON:PTR) rose 8% to 0.7p after flagging that the mini oil refinery for Licence 61 is ahead of schedule.
US-focused Nostra Terra Oil & Gas Company PLC (LON:NTOG) added 8% to 0.4p after stating drilling operations at the Pine Mills oil field will start in the coming weeks.
Moving against the trend, Petro Matad Limited (LON:MATD) shed 21% to 2p after reporting delays for an exploitation licence in Mongolia due to reorganisation at the Asian country’s relevant ministry.
Deltic Energy PLC (LON:DELT) shed 13% to 0.9p after Independent Oil &Gas PLC (LON:IOG) decided not to pull the trigger on a possible bid.
In the healthcare arena, 4D pharma tumbled 40% to 98p after reporting what it described as positive top-line data from the phase II trial of its live biotherapeutic for irritable bowel syndrome. One suspects the results were not quite as positive as the market had been expecting.
Sticking with the sector, Oncimmune Holdings PLC (LON:ONC) jumped 18% higher to 171p after receiving UK funding to help develop a “comprehensive diagnostic tool” for coronavirus.
Turning to ‘techies’, Minds + Machines dropped 20% to 5p after commencing a formal investigation to determine whether certain revenue has been correctly recognised in 2019.
Undoubtedly the star performer of the week was Asiamet Resources Limited (LON:ARS) which soared 109% to 4p after striking a US$163.4mln deal to sell its BKM Copper project to PT Wasesa Indo Nusa, a private Indonesian shell company.
In an acquisitions-rich week, freight management company Xpediator PLC (LON:XPD) advanced 17% to 26p after snapping up Yorkshire-based groupage freight firm Nidd Transport for £4.6mln.
Inspiration Healthcare Group PLC (LON:IHC) shot up 13% to 68.50p after declaring its maiden interim dividend following a positive first-half performance, when trading was buoyed by sourcing ventilators in the UK for coronavirus patients.
Next week Fonix Mobile is floating on the junior market by placing 50mln shares at 90p each to raise £45mln. The mobile payments and messaging company, which has over 100 clients including ITV and the National Trust, will be valued at £90mln.