Author: Fiona Craig

Phoenix Copper (LSE:PXC) has appointed a team of technical advisers to update the pre-feasibility study and open-pit mineral resource and reserve estimates for its Empire project in Idaho. Hardrock Consulting, metallurgist Deepak Molhatra and Valley Science and Engineering will carry out the work, which is targeted for completion by the end of the year.

Updated Study to Support Final Feasibility Work

The revised study will provide key technical information for Phoenix Copper’s final feasibility engineering and an updated Plan of Operations covering the proposed Empire open-pit mine.

As part of the process, the advisers will recalculate the project’s reserves using current, higher metal prices. This will provide an updated assessment of Empire’s potential economics following the publication of Phoenix Copper’s inaugural mineral reserve statement in 2024.

Management said its established relationships with the appointed consultants should help accelerate the technical programme. The updated resource, reserve and economic work represents another step towards determining the development potential of Empire and advancing the project towards possible production.

Financial and Technical Risks Remain

Despite progress at Empire, Phoenix Copper’s outlook continues to be constrained by its financial performance. The company currently generates no revenue and remains loss-making and cash consumptive, although its financial position showed some improvement during 2025 and its balance sheet remains comparatively stronger.

Technical indicators also present challenges, with the shares trading below important moving averages and the MACD remaining negative, indicating bearish momentum. Conventional valuation measures provide little support because the company has negative earnings and does not currently offer a stated dividend yield.

More About Phoenix Copper

Phoenix Copper is an AIM-quoted exploration and emerging production company focused on base and precious metals projects in the United States. Its initial development strategy centres on potential open-pit production of copper, gold and silver.

The company’s flagship asset is the Empire Mine in Idaho’s historic Alder Creek mining district. Drilling conducted since 2017 has more than tripled the project’s open-pit resource, providing the foundation for the maiden mineral reserve estimate published in 2024. Phoenix Copper is continuing technical and engineering work as it progresses Empire towards a potential development decision.

Quantum Helium (LSE:QHE) has reported further progress at its Sagebrush project in Colorado, where engineering and reservoir optimisation work is underway following encouraging results from an extended production test. Testing confirmed helium-bearing gas concentrations of around 2.5%, alongside strong reservoir connectivity, rapid pressure recovery and commercial oil within the Leadville Formation.

Sagebrush Work Targets Higher Flow Rates

The company is finalising an engineering and reservoir assessment that will determine the design of a larger stimulation and testing programme at Sagebrush. The next phase of work will be financed from Quantum’s existing cash resources and is intended to improve production flow rates.

The programme is expected to provide additional information needed to establish a potential route towards commercial helium production while integrating the oil production identified within the reservoir.

Colorado Exploration Pipeline Expands

Alongside work at Sagebrush, Quantum is progressing permitting and drilling preparations for two near-term oil prospects, Little Ute SE and Yellow Jacket SE.

The company has also identified three larger helium and oil opportunities at Mariano Wash SE, Lula and Sagebrush East, located across or adjacent to its existing Colorado acreage. Applications for additional acreage are also being prepared as Quantum seeks to establish a multi-year drilling inventory.

Together, these projects form part of the company’s strategy to develop a multi-field helium and associated oil business in Colorado rather than relying on a single producing asset.

Quantum is also approaching the end of the review process for a proposed listing on the U.S. OTC Markets. The additional quotation is intended to increase the company’s visibility and provide access to a broader base of U.S. investors.

Financial Risks Continue to Weigh on Outlook

Quantum’s financial position remains a significant risk despite the benefit of a debt-free balance sheet. Persistent losses, fluctuating revenue and increasing cash consumption continue to weigh on the company’s overall financial profile.

Technical indicators provide some near-term support for the shares, while the price-to-earnings valuation appears relatively low. However, these factors currently offer limited protection against the risks associated with negative cash flow and inconsistent profitability.

More About Quantum Helium Limited

Quantum Helium Limited is an AIM-listed exploration and production company focused on helium and associated oil resources in Colorado. The company holds majority interests in the Sagebrush and Coyote Wash projects, where its strategy centres on developing a portfolio of helium and oil opportunities.

Quantum is seeking to establish a multi-field operation supported by independently assessed helium resources, existing oil production and a growing pipeline of exploration and development prospects across its Colorado acreage.

Acuity RM Group plc (LSE:ACRM) has secured a three-year agreement with an unnamed UK public sector organisation for the deployment of its STREAM® risk management platform. The contract has a total value of £159,300, comprising annual licence fees of £45,000 alongside initial services revenue, adding to the cybersecurity-focused software group’s growing public sector business.

STREAM® Deployment Offers Scope for Expansion

The initial rollout of STREAM® will focus on one team within the customer organisation, where the platform will be used to address specific risk management requirements. Acuity said other teams are already considering adopting the technology, creating the potential for a wider deployment across the organisation.

The contract follows targeted investment by Acuity in developing its presence within the UK public sector. A broader rollout could generate additional subscription revenue and support the group’s strategy of increasing recurring income while strengthening its position in government risk management.

Losses and Cash Burn Remain Key Challenges

While the latest contract provides further commercial momentum, Acuity’s financial outlook continues to be affected by ongoing losses and persistent cash consumption, despite the company maintaining relatively low levels of debt.

Technical indicators also remain subdued, with the shares trading below important moving averages and the MACD in negative territory. Valuation offers limited support at present, given the company’s negative price-to-earnings ratio and absence of a dividend yield.

More About Acuity RM Group plc

Acuity RM Group plc is a UK software company specialising in the cybersecurity segment of the Governance, Risk and Compliance market. Through its STREAM® platform, the company provides technology designed to collect and analyse risk-related information, helping organisations improve oversight and support business decision-making.

Listed on AIM, Acuity serves customers across sectors including government, defence, broadcasting, utilities, manufacturing and healthcare. Its growth strategy combines organic expansion with complementary acquisitions, with STREAM® positioned as an enterprise risk management solution for organisations managing complex governance and operational risks.

Amigo Resources PLC (LSE:AMGO) has introduced its first formal dividend policy as the company works towards becoming a free cash flow-generating gold producer. The board is targeting the payment of an inaugural dividend within the next 12 months, reflecting its ambition to establish Amigo as a dividend-paying mining company while aligning the interests of management and shareholders.

Semi-Annual Dividend Framework Established

Under the newly adopted framework, Amigo intends to consider dividend payments twice a year, targeting a payout equivalent to between 40% and 80% of net profit. Any distributions will remain dependent on available cash, financing covenants and the operational and investment requirements of the business.

The company also plans to minimise dilution for existing shareholders by seeking to raise capital primarily through its individual project subsidiaries. This approach is intended to allow cash generated from Amigo’s Tanzanian operations to be reinvested where necessary before ultimately being available for distribution to shareholders.

Financial Performance Remains a Key Risk

Despite the dividend ambitions, Amigo’s outlook continues to face challenges from volatile financial performance. These include a significantly reduced revenue base, inconsistent profitability, periods of negative equity and recent cash outflows.

Technical indicators provide some support following a short-term recovery in the shares, although the broader financial picture remains uncertain. Valuation metrics are also difficult to assess positively given the negative price-to-earnings ratio and the absence of a current dividend yield.

More About Amigo Resources PLC

Amigo Resources PLC is a London-listed mining company with interests in gold, platinum group metals and rare earth projects across Africa, principally in Tanzania and Mauritania. The company is seeking to transition towards active gold production, with the longer-term objective of generating sustainable cash flow and returning a portion of profits to shareholders through dividends.

Likewise Group plc (LSE:LIKE) has strengthened its UK distribution infrastructure with the £9.57 million acquisition of a 60,000-square-foot high-bay facility in Corby, East Midlands. The site will provide additional storage, cutting and trunking capacity for the flooring distributor, with the installation of racking and cutting equipment starting immediately ahead of a planned operational launch in January 2027.

Corby Facility Supports Expansion Plans

The company views the new Corby hub as an important part of its longer-term growth strategy. The additional capacity is expected to ease pressure on its Birmingham operations while complementing recent developments in Derby and Newport.

Likewise is targeting further expansion across its distribution network as it works towards an aspirational sales revenue goal of £300 million. The company said positive trading momentum has continued through August as it approaches the seasonally busier autumn period.

Management is also assessing further property investments aimed at improving logistics and material-handling capabilities. Additional announcements relating to potential investments are expected over the coming months.

Financial and Technical Outlook

Likewise’s outlook is supported by improving cash generation alongside constructive technical indicators. The share price is trading above key moving averages, while the MACD remains positive, pointing to favourable underlying momentum.

However, valuation remains a significant consideration, with the company’s exceptionally high price-to-earnings ratio potentially limiting upside. Financial performance is also constrained by narrow operating and net margins, while revenue growth has shown signs of slowing.

More About Likewise Group Plc

Likewise Group plc is a UK flooring distributor supplying a range of floorcoverings through an integrated national logistics network. Its operations include major distribution hubs and regional facilities that provide the storage, cutting and transportation infrastructure required to serve customers throughout the UK.

The disruption to global oil supplies caused by the U.S.-Iran conflict and the blockage of the Strait of Hormuz is producing sizeable inventory declines, although Citi believes worldwide stockpiles could continue providing substantial cover for several more years.

Citi analysts estimate that observed global oil inventories fell by approximately 519 million barrels between February and August 2026, equivalent to an average draw of roughly 3 million barrels per day.

Extending that rate of depletion into the future suggests OECD inventories could decline to around 70 days of cover by the end of 2027. Stocks excluding China could reach the same level by approximately mid-2028, while global inventories would not fall to 70 days until the first quarter of 2029.

Citi highlighted 70 days of supply as an important historical threshold. Global inventories reached similar levels during the second oil shock of the 1970s and 1980s, when energy costs rose to approximately 8% of economic output.

Applying an equivalent energy burden to today’s economy would imply all-in oil prices exceeding $200 per barrel, according to the bank, considerably higher than the current level of approximately $120.

The headline inventory figures may nevertheless understate the risks emerging in specific parts of the market.

“Specific refined products (especially diesel) are already facing distress now, which could worsen further, meaning more localized, product-specific crises earlier than these projections would suggest,” Citi wrote.

Crude prices have already responded to fading expectations for a rapid diplomatic resolution. Brent has risen from around $80 per barrel at its early-August low to more than $93, while WTI has climbed from approximately $75 to above $86.

Conditions in refined products are even more extreme. U.S. wholesale diesel has risen to a premium of more than $100 per barrel over WTI, while the weighted refinery margin has increased by around 350% since the beginning of the year to $33.

Citi therefore sees the possibility of individual fuel markets encountering severe shortages well before aggregate global oil inventories reach historically critical levels.

The bank’s central forecast remains considerably less severe. Citi continues to expect an agreement that allows the Strait of Hormuz to reopen during the fourth quarter, which would ease supply pressures and help push Brent crude back into the $60s during 2027.

Fund managers have become increasingly confident about markets and the global economy, with Bank of America’s August survey showing bullish sentiment at its third-strongest level since 2022 and cash holdings approaching the bottom of their historical range.

Cash allocations declined another 0.1 percentage point during August to 3.5% of assets under management, placing them at the sixth-lowest level recorded since BofA launched the survey in 1998.

That leaves the bank’s Global FMS Cash Rule firmly on “sell,” with the contrarian indicator triggered whenever cash holdings stand at 4.0% or less.

Investors have simultaneously increased their exposure to stocks. Global equity allocations reached a net 56% overweight, their highest since November 2021, extending the period in which fund managers have been overweight equities to 14 straight months.

Expectations for the global economy have become particularly optimistic. A record 56% of respondents believe the economy will experience “no landing”, while 43% anticipate a “boom”, the highest reading for that outcome since February 2022.

“Consensus conviction is no macro landing, no Fed hike, no AI capex cut, no DEM sweep, no bears,” BofA strategists led by Michael Hartnett said in a note.

“Positioning continues to recommend investors retreat or rotate within risk assets rather than reload,” they added.

Expectations for another Federal Reserve interest rate increase have also diminished. The survey found that 72% of fund managers do not anticipate a rate hike before November’s midterm elections, with the proportion increasing from the previous month.

Attention is now turning towards Fed Chair Kevin Warsh’s appearance at Jackson Hole. Some 53% of respondents expect a neutral message, compared with 31% forecasting a hawkish tone and 7% anticipating a dovish approach.

Artificial intelligence remains central to both investor optimism and concerns. Long global semiconductor stocks continues to rank as the most crowded trade, although the proportion identifying it as such dropped sharply to 53% from 82% in July.

An AI bubble was identified as the largest tail risk by 32% of respondents. Separately, 38% said hyperscaler AI capital expenditure was the most likely potential source of a systemic credit event.

Even so, investors largely expect the spending boom to continue. Around 71% believe no hyperscaler will reduce capital expenditure during the current year, while 58% expect AI-related disruption to labour markets to remain limited until at least 2028.

August also produced a shift in sector positioning. Fund managers increased exposure to technology, banking and energy while reducing allocations to industrials and healthcare. U.S. equities moved to a net 27% overweight, their strongest position since December 2024, while emerging markets also attracted greater allocations.

Gold is increasingly viewed as inexpensive, with a net 16% of respondents describing the metal as undervalued, the highest proportion since March 2023.

With consensus positioning already heavily bullish, BofA’s contrarian ideas for August point in the opposite direction. The trades include buying bonds while shorting commodities, favouring Consumer Staples over Technology, buying Consumer Discretionary while shorting banks, and taking a long position in U.K. equities against a short position in U.S. stocks.

Bank of America’s Michael Hartnett continues to favour gold as a hedge against U.S. dollar weakness, with the latest fund flow figures showing investors putting the largest amount of money into the precious metal since January.

Gold funds collected $6.3 billion over the latest week, their strongest inflow since January 2026, according to BofA. The broader flow picture was also positive, with cash attracting $25.4 billion, bonds receiving $23.8 billion and equities drawing $16.1 billion.

The gold call forms part of Hartnett’s “Anything But Dollar” theme, which centres on positioning for risks associated with erosion in the value of the U.S. currency and other potential stresses across financial markets.

Hartnett wrote that the “trade is long gold…still best hedge against dollar debasement, bond collapse, asset inflation, capitalist populism vs socialist populism politics of 2020s.”

BofA also sees implications for emerging markets from the theme. It identified Brazil’s October 4 election as an event that could influence the direction of regional assets, noting that Latin American markets have recently responded favourably to governments perceived by investors as more business-friendly.

The bank said right-wing or right-leaning candidates have won all seven presidential elections held since January 2025.

Beyond gold, investment-grade bonds registered $10.6 billion of inflows, their highest level in five weeks. European equity funds attracted another $1.2 billion, representing their strongest result since February.

Flows were considerably weaker elsewhere. Investors withdrew $14.5 billion from Chinese equities, the biggest weekly outflow since May, while technology funds suffered $1.2 billion in withdrawals.

Bank of America’s Bull & Bear Indicator moved down to 9.3 from 9.7 as high-yield flows weakened and investors pulled money from technology and healthcare. Even after the decline, positioning remains “excessively bullish,” according to the bank.

BofA cautioned that “‘greed’ is always more difficult to reverse than ‘fear’,” while noting that the end of a bull market generally requires several conditions to come together. These include excessive positioning, elevated optimism surrounding corporate profits and a tightening of policy.

Investors may be placing too much confidence in a combination of resilient economic growth, contained inflation risks and manageable supply disruptions, according to Deutsche Bank, which believes today’s market backdrop is unlikely to remain in equilibrium indefinitely.

Macro strategist Henry Allen said global equities are trading at record levels while expectations across rates markets suggest central banks have almost finished raising interest rates. Commodity pricing, meanwhile, indicates investors are largely assuming that existing supply disruptions will remain contained.

“This goldilocks window isn’t a sustainable equilibrium,” he wrote, adding that markets are “pricing a near-immaculate scenario where basically everything goes right.”

Deutsche Bank sees two broad ways in which that optimistic backdrop could unravel. The first involves economic growth remaining stronger than expected while increasingly loose financial conditions make central banks more concerned about inflation.

Bloomberg’s measure of U.S. financial conditions recently reached its most accommodative point since 1996, according to the bank. That easing comes while headline and underlying inflation rates remain above target across many of the world’s major economies.

Such a combination could force policymakers to tighten monetary policy more aggressively than investors currently expect. Markets are pricing just one Federal Reserve rate increase, but Deutsche Bank noted that historically, tightening cycles have rarely consisted of a single hike followed by no further action.

The second possibility is that growth weakens. In that scenario, the economic resilience currently helping to sustain elevated risk-asset valuations would begin to disappear.

Allen stressed that an outright recession would not necessarily be required to produce meaningful market declines. Deutsche Bank cited the 2015-16 corrections and the 2022 bear market as examples of episodes in which economic slowdowns were enough to force investors to reassess asset prices.

Commodity markets could add another layer of risk. Oil remains below its recent peaks and futures prices decline further along the curve even though the Strait of Hormuz remains blocked.

Deutsche Bank believes another significant supply disruption could therefore present a particularly difficult outcome for investors. Such a shock could simultaneously undermine equities and bonds, leaving markets exposed after pricing in an economic environment where relatively little is expected to go wrong.

Artificial intelligence investment is accelerating rapidly across corporate America, but Goldman Sachs says the technology has yet to produce a clearly measurable earnings advantage for most S&P 500 companies.

The latest earnings season was nevertheless strong. S&P 500 earnings per share advanced 31% year-over-year in the second quarter after stripping out exceptional income associated with private investment stakes. AI infrastructure companies, including hyperscalers, contributed around half of that growth as their combined earnings increased 54% from the previous year.

Corporate profit growth was also relatively broad. Once the energy sector and its benefit from higher oil prices are removed, the median company in the S&P 500 still generated a 14% year-over-year increase in earnings.

The disconnect, according to Goldman strategists led by Ben Snider, is that companies are still struggling to demonstrate how deploying AI is feeding through to their bottom lines. Only 11% of S&P 500 businesses provided quantified productivity improvements for individual AI use cases during their latest earnings calls, including areas such as coding and customer service.

An even smaller 2% of companies quantified AI’s direct effect on earnings, leaving that proportion unchanged from the first quarter.

“Q2 results showed a small and statistically insignificant difference in earnings growth between the companies quantifying AI productivity gains this quarter and other S&P 500 companies,” the strategists wrote.

The potential for a more visible earnings contribution is increasing, however, as businesses rapidly expand their AI budgets. According to the Ramp AI Index, median monthly AI spending per employee more than doubled from $5 in January to $12 in July. The increase has been much greater among the highest-spending companies, with businesses in the top decile lifting monthly expenditure from $240 to $650 per employee over the same period.

For now, those costs remain manageable relative to corporate revenues. Goldman estimates AI inference spending amounts to less than 0.5% of S&P 500 sales. Its IT Spending Survey also indicates that roughly two-thirds of businesses are funding AI initiatives by redirecting money already allocated elsewhere.

Software budgets are the most common source of those funds, accounting for 18% of reallocations, while labour represents 11%.

That shift has not yet translated into widespread pressure on the software industry. Although individual companies such as Starbucks are developing internal AI products capable of replacing external software, broader software revenue growth has strengthened modestly over recent quarters. Software stocks have also rebounded after previously coming under pressure.

For investors, Goldman says the uncertain distribution of AI’s eventual financial benefits is influencing market positioning. AI infrastructure businesses offering clear and immediate earnings growth have attracted investor demand, while the market has been less willing to make aggressive bets on which companies will ultimately convert AI-driven productivity improvements into lasting earnings growth.