ASX Hot Stocks: Lynas, Karoon and Mirabela Nickel

ASX rises 0.5%, but these three surged more than 15%

Mike King

Mike King is a Fool.com.au Investment Analyst and Writer. He caught the investing bug more than a decade ago, at a time when the U.S. had invaded Iraq and fear reigned in the markets. His initial success as the markets took off encouraged his passion and thirst for knowledge. With 13 years behind him at one of Australia's largest domestic banks, Mike's passion for stocks led him to join a boutique funds management firm, where he stayed for four years. A seven-year stint in equity research at one of the largest investment banks in the world followed that, giving Mike a thirst to pursue his passion further. Mike holds a Diploma in Applied Finance and Investment and a Graduate Certificate in Financial Planning. His passion is to help retail investors invest better, and that passion was one of his primary reasons for joining The Motley Fool Australia in late 2011. Mike has written thousands of articles since joining, including for Fairfax Media, Yahoo!7, Ninemsn and has also appeared on ABC's The Business. You can see all of Mikes' holdings here

Published May 6, 2013 4:49 pm AEST

The S&P / ASX 200 Index (Index: ^AXJO) (ASX: XJO) has finished up 0.5% at 5,156.2 after briefly crossing the 5,200 level, before running out of puff. Our index followed the lead from Wall Street, where the Dow Jones rose 1%, and the S&P 500 gained 1.1%, on the back of strong US jobs data.

The Australian dollar has moved slightly higher against the US dollar, now buying 102.8 cents.

Here's why these three stocks are hot right now.

Lynas Corporation Limited (ASX: LYC) rose 16% to end at 58 cents, after Prime Minister Najob Razak's party won the Malaysian election to return to power. Lynas has faced heated opposition to its rare earths processing plant in Malaysia – which the Opposition had vowed during the election campaign to review and potentially shut down. Mr Razak's government has largely supported the plant, which suggests the plant is now relatively 'safe' from political threats.

Karoon Gas Australia Limited (ASX: KAR) climbed 23% to end at $4.89, after the company announced that the second out of the three wells it has drilled offshore Brazil had struck oil. The prolific Santos Basin in Brazil has already yielded some significant oil finds, and Karoon could potentially be sitting on billions of barrels of oil. We don't yet know how much oil there is or if it's commercially viable, but at least hitting oil is a good sign.

Mirabela Nickel Limited (ASX: MBN) surged a massive 50% to close at 16.5 cents, despite no announcement from the company. The price rise may have something to do with a presentation the company gave on Friday, in which Mirabela reported that it significantly reduced production costs, had off-take agreements for 100% of its production until the end of 2014, and had US$140m of cash on its balance sheet (Equivalent to its current market cap). Still, the company also has US$463m of debt and production has fallen in the last three quarters.

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