Lithium stocks slammed on talk of Chinese cutbacks, negative analyst notes

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Albemarle (NYSE:ALB) is Tuesday's biggest loser on the S&P 500, -8.1%, following a selloff in Asian lithium producing peers on rumors of production cutbacks at a major Chinese producer of cathodes.

Also: Livent (LTHM) -6.2%, Lithium Americas (LAC) -3.7%, Piedmont Lithium (PLL) -7.1%, Sigma Lithium (SGML) -8.8%, SQM (SQM) -2.1%.

According to The West Australian, Credit Suisse analyst Saul Kavonic linked a sharp fall in Chinese lithium futures to "speculation in China that a major cathode producer might have slashed production targets and some Chinese firms forecasting softening in the market late in 2023."

Goldman Sachs reaffirmed its bearish views on lithium this week, forecasting supply will begin to outpace demand from 2023 onwards.

Lithium-related ETFs such as the Global X Lithium & Battery Tech ETF (NYSEARCA:LIT) and the VanEck Rare Earth/Strategic Metals ETF (REMX), -1% and -2.8% respectively.

Albemarle's (ALB) premium valuation "leaves no room for any downside risk for lithium market demand," Zoltan Ban writes in an analysis newly published on Seeking Alpha.