EQ Resources Shares Sink 11% as Tungsten Miner Extends Volatile Pullback From Forrest-Fueled 2026 Rally

SYDNEY — Shares of EQ Resources Ltd. fell more than 11% on Friday, making the tungsten producer one of the weakest performers on the Australian market even as the broader index rebounded from Thursday's steep sell-off.

The stock dropped 5 cents, or 11.24%, to 39.5 Australian cents, extending a run of sharp swings for one of the best-performing resources stocks on the Australian Securities Exchange this year.

The company did not release any price-sensitive announcement explaining the decline. The fall came as investors continued to pull back from smaller critical minerals and resources stocks, a group that has seen heavy volatility in recent weeks.

Bucking a broader market rebound

EQ Resources' slide stood in contrast to the wider market. The benchmark S&P/ASX 200 index rose 0.58% to 8,664.6 on Friday, recovering part of Thursday's 2% drop, which had pushed the index to its lowest level since mid-June.

Gains on Friday were led by technology and energy stocks, while speculative miners, including lithium, uranium and rare earths producers, remained under pressure. Several lithium stocks were among the week's worst performers after Macquarie cut its price forecasts for spodumene, a key lithium raw material.

EQ Resources has also seen frequent share issuance in recent weeks. The company has lodged a series of notices with the ASX for the quotation of new shares and cleansing notices, most recently on Tuesday. Previous filings showed new shares being issued through the exercise of options and the vesting of performance rights.

A spectacular year

Despite Friday's decline, EQ Resources remains one of the standout performers on the ASX in 2026. Its shares have surged several hundred percent over the past year, lifting the company's market value to close to A$2 billion and transforming it from a small-cap miner into one of the most closely watched names in the critical minerals sector.

The rally has been driven by record tungsten prices, rising production and growing investor interest in Western sources of the metal.

The company's shares have also swung sharply in both directions. Earlier in September, EQ Resources fell more than 9% in a single session amid a broad resources sell-off, while other sessions have delivered double-digit gains.

Andrew Forrest takes a major stake

One of the biggest catalysts this year came when mining billionaire Andrew Forrest acquired a 16.8% stake in the company through his private investment vehicle, Wonongarra Pty Ltd.

Forrest bought the entire cornerstone holding of U.S. investment firm Oaktree Capital Management, about 862.1 million shares and 35.6 million options. EQ Resources shares jumped 34% on the day the deal was announced, the stock's largest single-day gain in about 18 months.

The investment by Forrest, the founder of iron ore giant Fortescue, was widely seen as an endorsement of EQ Resources' strategy and of tungsten's strategic importance.

Why tungsten matters

Tungsten is a dense, hard metal used in a wide range of industrial and defense applications, including cutting tools, drilling equipment, electronics, aerospace components and armor-piercing munitions. It is classified as a critical mineral by the United States, the European Union and Australia.

China dominates global tungsten production and has tightened controls on exports of the metal, prompting Western governments and manufacturers to seek alternative supplies. That has pushed tungsten prices to record highs and boosted demand for producers outside China.

EQ Resources has positioned itself as a leading Western tungsten producer, with operations in both Australia and Europe.

Operations in Queensland and Spain

The company's flagship asset is the Mt Carbine tungsten mine in Far North Queensland, about 120 kilometers northwest of Cairns. It also operates the Barruecopardo mine in Spain's Salamanca province through its Saloro business.

Earlier this year, EQ Resources reported a 33% jump in quarterly production as it ramped up operations. The company has also expanded its exploration tenure at Mt Carbine and is working to develop the high-grade Iolanthe Vein.

To fund its growth, EQ Resources raised A$34 million through a share placement at 5 cents per share in December 2025, while Oaktree converted a A$7.25 million loan into equity. The placement price is far below current trading levels, highlighting the scale of the stock's rally since then.

Risks for investors

Analysts say EQ Resources' rapid rise leaves the stock vulnerable to sharp pullbacks, particularly as investors take profits or shift away from speculative resources names.

The company's share count has also grown significantly through capital raisings, acquisitions and option exercises, which can dilute existing shareholders. In addition, its fortunes remain closely tied to tungsten prices, which could fall if supply conditions ease or demand weakens.

Operational risks, including weather-related disruptions in Queensland and the challenges of ramping up production at multiple sites, also remain.

Investors will be watching for EQ Resources' next quarterly activities report, expected later this month, for updates on production, costs and progress at Mt Carbine and Barruecopardo. The company's annual general meeting, for which it has already issued a notice, will also offer management a chance to outline its strategy.

The direction of tungsten prices and broader sentiment toward critical minerals stocks are likely to remain key drivers of the share price in the near term.