And then there are the small caps – those weary little battlers of the exchange that everyone had left for dead until recently. Dollar Bill’s “tide is turning for small caps” musings, published well over a year ago, was delivered when small cap sentiment was shot, capital was comatose and IPOs were spoken of in the past tense. Since then, as predicted by The Dollar, small caps have for the first time in years outperformed everything else.
History has a habit of rhyming. Falling rates, rising risk appetite and a touch of inflation fatigue; all these old ingredients were back in the bowl.
Even now, some of the big desks are still arguing about whether this is the start of a new small-cap cycle or just a dead cat that’s recently been through obedience school. But the pattern fits too neatly to ignore. Every easing cycle breathes life into the bottom end. If you take a step back, you can feel it. The capital raisings are livelier, the optimism less apologetic and the analysts have been dusting off their old “re-rating potential” slides.
Furthermore, the very smallest end of the IPO market has gone from nothing, to something real. Listings were all but frozen just 18 months ago, when the ASX recorded a 20-year low of only 29 new listings in 2024. Then the pipeline quietly started to fill. By mid-2025 multiple small-cap IPOs were back on the agenda, small raises were again oversubscribed and the brokers started dusting off their listing playbooks. Late November and December this year has only seen the pace quicken.
So yes, it’s been three swings from the rafters and three hits for Dollar Bill with uranium, silver and the revival of small caps.
And to be honest, given Dollar Bill likes to think of himself as the quiet, retiring type, it is slightly embarrassing trying to fend off the accolades from the smoking jacket types in the cigar bar on the way to the Gents at the Club these days.
Only recently, a self-described debonair fellow in the group with a handlebar moustache (who is obviously an avid reader of Dollar Bill’s columns) yelled “Hey Dollar, what’s next?”
So looking ahead, if we dare to tempt fate a little further, Dollar Bill, on a roll decided to have a wild swing again – this time in favour of lithium and nickel. Forget rare earths – now a common and mainstream favourite amongst forecasters – instead what’s caught the eye is the recent price movement and potential for a revival in nickel and lithium – after all these two are also a big part of the electric vehicle revolution right?
Rare earths go in the electric motor magnets and lithium and nickel are shoved into the batteries.
To be fair, lithium has been on the move for a few months and looks to have found a floor, but the next step could be its spring. After bottoming earlier this year, spot prices for both hydroxide and carbonate have already started a recovery. Hydroxide, typically produced from hard rock lithium – or spodumene – has seen traded prices climb about 25 per cent in the past six months while carbonate prices have fared even better, up almost 30 per cent in the past six months to about US$13,000 per tonne as inventories thin and EV demand rebounds in China and the US.
These current prices are still a fraction of the lofty heights hit in 2022 when carbonate traded north of $US80,000 per tonne. But following its collapse to sub $US10,000 a tonne in late 2024 / early 2025, more recent pricing since looks to have flipped from despair to accumulation. Producers are tightening supply, new projects are being shelved, and the oversupply narrative that spooked the market is starting to sound dated.
Nickel is another, which has also been on the mat for years, bruised by a flood of Indonesian supply and government-backed subsidies that turned balance sheets into battlefields. But even commodity cycles have half-lives. Nickel still sits at the core of the battery and stainless-steel story, and the structural demand from electric vehicles and energy storage isn’t fading – it’s only compounding. Supply distortions more often than not delay reality, but almost never defy it. When the market finally wakes to the mismatch between short-term oversupply and long-term need, nickel’s next move could be sharp enough to make up for lost time.
And to confirm the point so humbly made about The Dollar’s forecasting record of late, just in the past two weeks spot nickel has charged more than 11 per cent higher and is now changing hands back above US$15,000 a tonne – its highest point in more than 6 months.
Until recently, both nickel and lithium were clubbed senseless by oversupply fears, trading well beneath long-term incentive prices. But both still sit at the heart of the new energy story and simply won’t roll over and die. A quick glance at the latest price movements tell the story and The Dollar reckons the recovery in both has further to play.
So yes, Dollar Bill has dared to say I told you so – sort of. But don’t expect a victory lap. If the next round of expectation goes pear-shaped, you’ll find The Dollar back at the club nursing something brown and muttering about “market timing” to whoever still believes in it or anything else he says. Until then, Dollar Bill will take the small pleasure of polishing the monocle and raising a quiet glass to three words that really should never be spoken aloud in finance – I told you so.
Is your ASX-listed company doing something interesting? Contact: mattbirney@bullsnbears.com.au
