DPM Metals Shares Down 10% On Week, As Key Averages Tested

DPM Metals shares (ASX:DPM) closed 8.41% lower at A$57.41 today, to bring the cumulative weekly pullback to 10%. With bulls having quickly looked to reclaim the A$60 handle the most recent time shares were pushed below, we will be watching the early clues next week as to whether buyers appear willing to step in once again.

The company is having to deal with a final ruling from the Constitutional Court of Bosnia and Herzegovina on the company’s Vareš concession that may cause a few raised eyebrows however.

Late yesterday the company confirmed that the Court had published its full decision in a constitutional dispute over state-owned forests and forestry land. The Court found that certain acts, including the Vareš Concession Agreement dated March 12, 2013 and its annexes, were not in conformity with the constitution because Federation, cantonal and municipal authorities did not have the authority to deal with that property. The decision is final and not subject to appeal.

Crucially, the ruling does not terminate or suspend the concession, and DPM said Vareš continues to operate as normal. The Court has given the relevant authorities, working with the Attorney General’s Office, six months to review the challenged acts and bring them into conformity with the law. DPM said it intends to “engage constructively” throughout the process.

The sensitivity is understandable because Vareš is the company’s growth engine. The mine reached commercial production in August and is ramping toward a full run rate of 850,000 tonnes per year by the end of 2026, with this year’s output guided toward the high end of 105,000 to 130,000 gold-equivalent ounces. Even a modest increase in the perceived probability of future renegotiation, delay or legal friction can justify a wider risk discount on that growth story.

The macro is doing part of the damage too, with Gold prices falling 7.13% over the past 30 days. September was the worst month since mid-2023, as the Federal Reserve hiked rates again and signalled possible further tightening while global bond yields pushed to multi-decade highs.

On the technical side, we see an extended rally losing momentum after a 70% 1 year gain, with markets testing direction. The 20-day CCI sits near 79, neutral territory, and is cooling from an upside stretch, which fits a stock unwinding gains after a strong run rather than one already washed out. The share price also gapped lower, fell through both the 30 day and 50 day SMAs into the weekend (A$62.45, A$60.86 respectively), and came within touching distance of the 200 day at the low (A$53.08) before stabilising through the session. These all point to a near term test of momentum, that is moving to the bear side near term, and testing longer term appetite.