Why is Lake Resources stock price rising 6%?

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The Lake NL Resources (ASX: LKE) the stock price jumped today, just a day after being added to the S&P/ASX 200 Index (ASX:XJO).

Shares of the company are currently trading at $1.49, a gain of 5.67. For perspective, the S&P/ASX 200 Materials Index (ASX:XMJ) is up 0.04% at the time of writing.

Let’s see why Lake Resources’ stock price could jump today.

Lithium prices in brief

Lake Resources stock price is up today, but it’s not the only one. Core Lithium Ltd (ASX:CXO) jumped 6.7% and was also added to the index as part of the June 2022 quarterly rebalancing. Allkem AG (ASX:AKE) stock price edged higher, up 0.77%, while Limited mineral resources (ASX:MIN) is 0.12% in the green. In contrast, Liontown Resources Limited (ASX: LTR) slipped 0.81% while Sayona Mining Ltd (ASX: SYA) is flat.

Shares of ASX lithium plunged last Wednesday after news that Argentina had set a benchmark price for lithium carbonate exports of $53 per kilogram.

In the news overnight, it emerged that the benchmark set by Argentina for lithium carbonate prices may not have as much of an impact on lithium prices as initially thought.

A report of S&P Global Commodities Outlook overnight, Chinese lithium carbonate producers said “prices abroad will not drop drastically following Argentina’s announcement”. A source said:

The purpose of the reference value is actually to prevent sellers from avoiding tax evasion by declaring low prices to customs.

Therefore, we do not see any impact of this announcement on the spot market in the short term.

Lake Resources aims to produce lithium carbonate from the Kachi Lithium Brine project in Argentina by 2024.

Share price overview

Lake Resources’ stock price has climbed 451% in the past year after jumping 48% year-to-date.

To put it into perspective, the ASX 200 has lost almost 1% in one year.

Lake Resources has a market capitalization of approximately $2 billion based on its current share price.

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