The Sayona Mining Ltd (ASX: SYA) share price is off to a bad start to the month. Its shares are down 4.26% in late afternoon trade today.
Shares in the lithium producer currently trade for 22.5 cents, but earlier touched an intraday low down 8.5%.
While there's no news today from the company to explain the sell-off, there's some evidence to suggest it's falling lower along with most of the market. Let's investigate.
Rising interest rates pose a threat
We're in uncertain times, and the market can't seem to decide if it wants to trend up or down, thus leading to volatility in individual share prices. The market could be feeling antsy amid United States jobless claims numbers coming in lower than expected last week. It's feared this will help the Federal Reserve to continue attempts to hammer down inflation through aggressive interest rate hikes.
A knock-on effect of rising interest rates in the US is a stronger US dollar and more attractive yields from treasury bills, thus giving people another viable alternative to investing in shares.
The other side to this is that as the US dollar becomes stronger, other countries may be tempted to hike their own interest rates to help keep their currencies competitive, which could spiral their economies into recession, as reported by Reuters.
ASX shares and indices fall
This uncertainty could be reflected in the behaviour of ASX shares on Monday.
The S&P/ASX 200 Materials Index (ASX: XMJ) is almost flat this afternoon at just a 0.13% gain. Meanwhile, the S&P/ASX 200 Index (ASX: XJO) is also flatlining at a 0.13% loss.
It's worth mentioning that the ASX 200 hit a low of 6,411 a few minutes before midday. That's a 0.97% loss from the index's opening of 6,474, which suggests significant volatility.
Some of Sayona Mining's peers are also struggling on Monday. This includes Core Lithium Ltd (ASX: CXO) and Pilbara Minerals Ltd (ASX: PLS). These companies are down 3.62% and 0.66%, respectively.
Sayona Mining share price snapshot
The Sayona Mining share price is up around 75% year to date. Meanwhile, the ASX 200 is struggling at a 13% loss over the same period.
The company's market capitalisation is $1.95 billion.
