Sell Valentine’s Day?
One of my rules that will never get traction is that one should buy the stock market on Bonfire Night and Sell Valentine’s Day. For the latest period, on November 5 the FTSE 100 closed at 9,777, and on Friday hit 10,446. Not a bad return. The reason that the rule will not get much traction is that it would put the City and stockbrokers like AJ Bell / Hargreaves Lansdown out of business, if investors were only in the market for 3 months a year. But if you look back over the years, investing just at this time would have stood you in good stead. The explanation is the end of year window dressing of November / December, and then the “wall” of money that comes into the market for the New Year. Interestingly, last year the big opportunity in addition to this rule was to buy on the tariff wars scare at the beginning of the tax year. Amazingly, the rug was pulled to below 8,000 at one point. I would not say that this was necessarily a slam dunk opportunity, as it was before the TACO trade was fully recognised – Trump Always Chickens Out.
We are still not without our TACO issues, as if it is not Fed appointments, or attacking Iran, there continues to be matters to be fearful about. But with the FTSE 100 set to stretch its advantage over 10,000, despite my sell Valentine’s Day rule, so far the wall of worry rally continues.
Small Caps Keeping Up
If pushed it may be time to take something off the table on blue chips, but the question is whether the same is true for the small caps. They have had a rocket put under them via the great commodities boom, led by gold. Given that so many small caps on the London market are explorer / developers, and many fronted by Colin Bird, like Kendrick (KEN), they have enjoyed a purple patch so far in 2026. Indeed, AIM and the Small Cap index are neck and neck with the FTSE 100’s 5% gain year to date. This is a major breakthrough, especially given the way that we still continue to see so many companies de-list. Against the same backdrop of death by service providers / cost / red tape, the way that at least to start 2026 small caps are being able to run to stand still is something of a result.
This Week’s Risers
It has been disappointing of late that there just have not been the Aquis movers (in a positive direction) of late. Unfortunately, this market still gives the impression to everyone I ask about it of a market that just does not have the liquidity it should, even though perhaps the reality since the Bitcoin Treasury companies flattered volumes last year, may be different. However, we do have a rising star in the form of Delta Gold (AQSE:DGQ), a company whom I met briefly at the Aquis Showcase event in November, and who have not been in touch since. Fortunately, the charting coverage has done the job, with the first share price target at 26p. Now we are looking at what should be a relatively easy move through 40p by the end of next month. The fundamental driver here of course the way that this is a technology company developing intellectual property in the quantum computing sector, which given that QC is about the hottest thing in town means the stock is understandably flying. This week witnessed the announcement of a Research Sponsorship and exclusive Technology Licensing Agreement with Penn State University in Pennsylvania, USA. In return for funding the programme to the tune of some $3m, Delta will receive from Penn State an exclusive, sublicensable, royalty-bearing licence to any resulting intellectual property, permitting the Company to make, have made, use, import, offer for sale, and sell products in all fields except Human Health. Delta will pay Penn State a running royalty of one percent (1%) on Net Sales of licensed products once cumulative Net Sales exceed $20,000,000. If the company can indeed get a return like this, the current share price rise could just mean we are at the foothills.
Although I may have the occasional dig at Helium One (HE1) regarding it having gone quiet regarding what may or may not be going on at its Tanzania assets, it would appear that the market is quite satisfied by the progress its investment is making in the US. On Thursday we were treated to a Galactica Project Update, where we heard the operator is implementing a strategy that anticipates meeting market needs and maximises the value of the end product. Arrangements have been made for spot sales of helium and discussions in respect of long-term contracts with both helium and CO2 off-takers are progressing. These discussions are targeting a mix of short-term sales arrangements and long-term offtake agreements to match the targeted ramp-up of the Pinon Canyon Plant’s capacity. All of this was enough to deliver a 79% share price rise for HE1 on the week, and probably allows scope for yet another of the company’s famous mega discounted fundraises, sooner rather than later.
Speaking of helium, whether present or not, we were treated to a promise that we are near production at Helix Exploration (HEX), where it has been a long wait for the following promise: “Our team has worked tirelessly, and thanks to their dedication and expertise, we are now closer than ever to achieving a significant milestone – becoming the first helium producer in the state of the Montana.” From memory it has been a couple of years since we have been waiting for the production announcement at HEX, so long in fact that I have managed to lose over three stone on Mounjaro during the intervening period. The market enjoyed the news with the share price bouncing 17% on Friday.
The long and winding road as far as getting flagship project funded has been a highlight of the small cap area of the market regarding KEFI Minerals (KEFI). However, it would appear that the saga is coming into land as far as Tulu Kapi is concerned, a point underlined by the way that the shares were up another 27% this week. The company reported the signing by subsidiary Tulu Kapi Gold Mines S.C. of a US$20 million equity-ranking-royalty with Chancery Royalty Limited. KEFI said “This is a key final part of the US$340 million financing package for the Company’s high-grade/high-recovery Tulu Kapi Gold Project. It has been creatively structured with Chancery Royalty to be an equity-risk ranking royalty and is payable alongside distributions made by TKGM to its shareholders.”
Kendrick Resources Plc (KEN), the mineral exploration and development company, announced that it has secured a £337,000 unsecured convertible loan facility provided by high net worth individuals, including £37,000 from Colin Bird the Company’s Chairman which is convertible at 0.66804 pence per share and repayable by 31 January 2027. KEN shares have rocketed since last month, up over 4x since January 1, giving our Colin a spectacular win, and one which is much deserved after all these years.
Another stock which is being successfully called up by all and sundry at the moment is Physiomics (PYC). Until this year’s revival to the tune of 128% for the shares, the mathematical modelling, data science and biostatistics company supporting the development of new therapeutics and personalised medicine solutions, used to be best known for delivering small value contracts. Perhaps the announcement of a £66k keeps up the “small” contract image. But of course, size isn’t everything and the shares have recognised this with a decent rise to end the week at 0.65p. After calling the stock up to 0.45p here, we were then looking to 0.58p, and above this as high as 0.82p by the end of this month as a best case scenario. Yes, I am getting good at this as I head towards retirement.
I like using phrases which may now be extremely outdated, but are still very much appropriate when discussing the stock market. This is especially on the basis that these days it is easy to google things one does not understand. In the case of Altona (REE), shares of the resource exploration and development company focused on critical raw materials in Africa continued to fly after the announced that the United States Government has confirmed its intention to support the Monte Muambe Rare Earths project in Mozambique. This is better than the Man From Del Monte as far as the company is concerned, and the gold standard as far as validation of its flagship project.
As far as situation was concerned, after years of being in a state of flux it could be said that the cavalry has arrived for Contango (CGO). The company announced a proposed Subscription of approximately £5,000,000 at 1.11p per share to existing Muchesu Mine Operator Pacific Goal Investments Private Limited (PGI) and major Company shareholder Huo Investments (Pvt) Limited. Given that prior to this the changes of salvation for the company appeared to be on a par with Keir Starmer serving a full term. Indeed, given how momentous the news this week was and is, one wonders how the stock only rose less than 20%.
Finally, given that EnergyPathway (EPP) shares have a habit of moving significantly before significant news, one could not help but notice the 20% rise in the shares this week on no news. If we assume that the stock is leakier than The Treasury before the Budget, this is a case of there being no smoke without fire. It would of course be great if this is a Man From Del Monte moment for the company, and not a delay announcement, or “we have changed our mind” from the Government. Big binary bet situations and small caps do not usually go well together. That said, let’s hope for the best.
Disclaimer & Declaration of Interest:
The information, investment views, and recommendations in this Zaks Traders Cafe interview are provided for general information purposes only. Nothing in this interview should be construed as a promotion or solicitation to buy or sell any financial product relating to any companies under discussion or referred to or to engage in or refrain from doing so or engage in any other transaction. Any opinions or comments are made to the best of the knowledge and belief of the commentator but no responsibility is accepted for actions based on such opinions or comments. The commentators may or may not hold investments in the companies under discussion.
