Why did the New Hope share price just surge 6% to a 10-year high?

Why did the ASX 200 coal miner have such a great day?

| More on:
a coal miner in hard hat with a light on it kisses a large lump of coal that he is holding in his hand.

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

Key points

  • New Hope shares are hitting fresh highs
  • Macro tailwinds have been boosting ASX coal shares
  • Demand for coal is soaring as the world grapples with the energy crisis

The New Hope Corporation Limited (ASX: NHC) share price finished Tuesday's session up a healthy 6.12% at $5.72. This came after the ASX coal miner hit a new 10-year high of $5.79 just moments before market close.

For context, the S&P/ASX 200 Energy Index (ASX: XEJ) gained just 0.5% for the day. Elsewhere though, other ASX coal shares also enjoyed a stellar session on Tuesday. The Whitehaven Coal Ltd (ASX: WHC) share price notched up its own all-time high, finishing the day 3.65% higher, while Yancoal Australia Ltd (ASX: YAL) shares finished 6.34% higher.

New Hope shares reached the 10-year milestone despite there being no news from the company today. However, macro tailwinds have been developing, boosting ASX coal miners. Let's go over the highlights.

What's been boosting New Hope?

New Hope shares enjoyed strong gains today on the back of some positive news for the sector overall. Firstly, as reported by The Australian Financial Review, despite increasing global pressure to reduce reliance on fossil fuels, Prime Minister Anthony Albanese has reiterated that Australia will continue to be a key international supplier of energy materials like gas and coal.

Speaking at the annual Minerals Council of Australia dinner on Monday night, he said:

Australia will continue to be a trusted and stable supplier of energy and resources to our key trading partners. As we work with other nations to reduce emissions globally, we will continue to be a reliable provider of energy.

Secondly, the global energy continues to worsen, boosting the demand for coal and sending profits soaring for Australia's largest coal mining shares.

Over the weekend, Russia shut down its Nord Stream 1 gas pipeline, restricting supply to several European nations and forcing them to find alternative energy supplies. This resulted in future contracts of Newcastle Coal rising to a new high of US$435 per tonne.

Meanwhile, Whitehaven Coal, which made a $1.95 billion profit for FY22, reported in its annual results release to the ASX late last month that the outlook for coal remains strong:

It is likely to take several years before additional supply or alternative energy sources are available to rebalance global supply and demand dynamics.

New Hope share price snapshot

The New Hope share price has gained a whopping 156% this year to date. By comparison, the S&P/ASX 200 Index (ASX: XJO) is down 8.3% over the same period.

The company's market capitalisation based on the current share price is around $4.76 billion.

Motley Fool contributor Matthew Farley 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 Scott Phillips.

More on Share Market News

A happy young couple lie on a wooden deck using a skateboard for a pillow.
Share Gainers

These were the best-performing ASX 200 shares in March

These shares made their shareholders smile in March thanks to some very big gains.

Read more »

Businessman using a digital tablet with a graphical chart, symbolising the stock market.
Opinions

2 ASX shares I have been buying in 2024!

I’m a believer in the long-term outlook of these stocks.

Read more »

Stock market chart in green with a rising arrow symbolising a rising share price.
Share Gainers

Here are the top 10 ASX 200 shares today

It was a massive day for the ASX 200, with a new all-time high recorded.

Read more »

A man sits thoughtfully on the couch with a laptop on his lap.
Technology Shares

This ASX tech stock rocketed 60% in March! Can it keep on delivering?

After soaring in March, the ASX tech stock is now up 169% since this time last year.

Read more »

Broker Notes

Brokers name 3 ASX shares to buy now

Here's why brokers are feeling bullish about these three shares this week.

Read more »

A young man clasps his hand to his head with his eyes closed and a pained expression on his face as he clasps a laptop computer in front of him, seemingly learning of bad news or a poor investment.
Share Fallers

Why Burgundy Diamond Mines, Clarity Pharmaceuticals, EML, and Zip are sinking today

These ASX shares are ending the week in the red. But why?

Read more »

A young women pumps her fists in excitement after seeing some good news on her laptop.
Share Gainers

Why Mesoblast, Newmont, Pilbara Minerals, and Platinum shares are jumping

These ASX shares are ending the week strongly. But why?

Read more »

a young boy dressed up in a business suit and tie has a cute grin and holds two fingers up.
Opinions

2 of my top ASX 200 shares to consider buying before April

I would happily exchange dollars for these two shares right now.

Read more »