Why the Vulcan Energy (ASX:VUL) share price is in the spotlight this week

This lithium developer's shares are on watch this week…

| More on:
industrial asx share price on watch represented by builder looking through magnifying glass

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The Vulcan Energy Resources Ltd (ASX: VUL) share price has come into the spotlight again this week.

Not that it ever really lost the spotlight.

With the lithium developer's shares up 422% since the start of the year, it has been getting a lot of attention from investors.

Why is the Vulcan Energy share price in the spotlight this week?

The Vulcan Energy share price was given an additional boost this week when S&P Dow Jones Indices announced changes to the S&P/ASX Indices. These changes will be effective prior to the open of trading on 20 September and follow S&P Dow Jones Indices' quarterly review.

According to the release, the lithium developer's shares will be added to the S&P/ASX 300 Index (ASX: XKO) at the next rebalance.

It is one of 12 new additions to the index, along with fellow lithium explorer Liontown Resources Limited (ASX: LTR) and battery materials focused company Novonix Ltd (ASX: NVX).

Why is this good news for Vulcan Energy?

Being added to an index like the ASX 300 can be a big positive for a company's shares.

This is for two reasons. The first is that index funds or ETFs that track the index will have to purchase shares. This buy-side pressure could give the Vulcan Energy share price an additional boost in the coming days and weeks.

Another reason is that many fund managers have strict investment mandates. This means they can only buy shares from certain indices.

This means that any fund managers that were restricted from buying shares outside the ASX 300, will now be able to consider Vulcan shares.

Though, with the Vulcan share price up so much since the start of the year, they may well wait for a pullback before considering an investment.

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on Resources Shares

Cheerful businessman with a mining hat on the table sitting back with his arms behind his head while looking at his laptop's screen.
Resources Shares

Rock solid: How have mining and metals shares fared in 2025?

Who is leading so far?

Read more »

Miner looking at a tablet.
Resources Shares

Mineral Resources share price slides despite significant reserves growth

An 89% resources upgrade hasn’t boosted Mineral Resources shares today.

Read more »

Copal miner standing in front of coal.
Resources Shares

How much upside does Macquarie tip for New Hope shares?

A softer-than-expected quarter has impacted the broker's view.

Read more »

2 people at mining site, bhp share price, mining shares
Resources Shares

Rio Tinto share price pushes higher on $1.4 billion lithium agreement

Rio Tinto shares are gaining major lithium exposure.

Read more »

Miner looking at a tablet.
Resources Shares

Up 73% since April, why Mineral Resources shares could keep charging higher

A leading expert says that Mineral Resources shares remain ‘heavily undervalued’. But why?

Read more »

Frustrated stock trader screaming while looking at mobile phone, symbolising a falling share price.
Resources Shares

Guess which ASX 200 mining stock is sinking 7% following its quarterly update

Let's see how this miner performed during the third quarter.

Read more »

Miner looking at a tablet.
Resources Shares

What's the latest broker ratings on BHP shares?

There's an air of caution floating about BHP shares even with bullish ratings.

Read more »

A young African mine worker is standing with a smile in front of a large haul dump truck wearing his personal protective wear.
Resources Shares

BHP shares last traded at $50 in 2023. When will they get back there?

Let’s dig into the potential for BHP shares to rise.

Read more »