Shares of Chalice Mining, Northern Star, Peninsula Energy, and Service Stream Drop Sharply

Highlights:

• Chalice Mining Ltd: Shares dropped 8% due to an update on metallurgical testwork and pre-feasibility study, despite potential upside for metal recoveries and sector-wide downturn.
• Northern Star Resources Ltd: Shares fell 6% following a weak session for gold, with broader declines in the gold market impacting its stock.
• Peninsula Energy Ltd: Shares decreased by 9% after completing a retail entitlement offer, raising AU$105.9 million, which strengthened its financial position but resulted in a negative market reaction.

In afternoon trade, the S&P/ASX 200 Index (ASX: XJO) is experiencing a notable decline, down 1.5% to 7,741.3 points. Among the hardest hit are shares of Chalice Mining, Northern Star, Peninsula Energy, and Service Stream. Here’s why these stocks are underperforming:

Chalice Mining Ltd (ASX: CHN)

Chalice Mining shares have fallen 8% to AU$1.51. The company released an update on its metallurgical testwork and pre-feasibility study (PFS), indicating potential upside for overall metal recoveries. However, further tests are needed to quantify the impact. Chalice aims for a final investment decision by late 2026 and plans to start production in 2029. The broader mining sector's downturn is also affecting Chalice's stock.

Northern Star Resources Ltd (ASX: NST)

Northern Star shares are down 6% to AU$13.70, following a difficult session for gold. The precious metal saw its worst performance in several years on Friday, and although it rebounded on Monday, it wasn’t enough to prevent further selling. The S&P/ASX All Ordinaries Gold index is down 5.7%, dragging Northern Star down with it.

Peninsula Energy Ltd (ASX: PEN)

Peninsula Energy shares have dropped 9% to 10 cents. The decline follows the completion of the retail component of its entitlement offer, raising a total of AU$39.8 million at 10 cents per share. Including previous placements and the institutional entitlement offer, the company has raised approximately AU$105.9 million before costs. Despite strengthening its financial position, the market reaction has been negative.

Service Stream Ltd (ASX: SSM)

Service Stream shares have declined 4% to AU$1.18. This drop is attributed to a broker note from Macquarie, which downgraded the stock to a neutral rating but with an improved price target of AU$1.30. The downgrade follows a strong run since the release of its half-year results. Despite the valuation downgrade, Macquarie remains positive on Service Stream’s outlook.

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