The Arafura Resources Ltd (ASX: ARU) share price is making up some lost ground today.
Shares in the ASX rare earths explorer and near-term producer closed on Friday trading for 28 cents per share and are currently trading for 30 cents, up 9%.
This comes following a 15.6% drop on Friday.
Image source: Getty Images
What have ASX investors been considering?
The Arafura share price came under selling pressure on Friday after the mine emerged from a trading halt in the wake of its capital raising announcement.
The miner announced a placement of 156.7 million new shares at an issue price of 26.5 cents to raise $41.5 million.
Before entering the trading halt, Arafura shares closed at 32 cents on Tuesday, 17.2% higher than the new share issue price. Hence Friday's sell-off.
Today investors are bidding up shares, perhaps taking into account that the miner said it will use the funds to help accelerate the completion of its Nolans Project, located in the Northern Territory.
The miner says that Nolans, which is under development, has the potential to supply "a significant proportion" of global neodymium and praseodymium (NdPr) demand. Some of the new funds will also be deployed to increase Arafura's capacity to secure neodymium oxide as part of the project.
Arafura share price snapshot
Despite some big ups and downs, the Arafura share price remains up 127% over the past 12 months. That compares very favourably to the 7% full year loss posted by the All Ordinaries Index (ASX: XAO).
