Why has the Afterpay (ASX:APT) share price gained 5% this week?

An executive in a suit smooths his hair and laughs as he looks at his laptop feeling surprised and delighted by the VAS ETF share price gains on the ASX

It’s the lead-up to Christmas, and many eyes are watching the Afterpay Ltd (ASX: APT) share price surge higher once more.

But it’s likely not the holiday spirit driving the company’s stock higher.

At the time of writing, Afterpay’s shares are trading for $86.9 apiece. That’s 1.76% higher than their previous close and 5% higher than they were at the end of last Friday’s session.

For context, the S&P/ASX 200 Index (ASX: XJO) is up 0.56% right now.

So, what might be boosting the buy now, pay later (BNPL) giant’s shares this week? Let’s take a look.

What’s driving the Afterpay share price higher?

It’s been a good week for the Afterpay share price – and those of its peers have also been gaining.

Right now, the Zip Co Ltd (ASX: Z1P) share price is 5.7% higher than it was at the end of last week. That of Sezzle Inc (ASX: SZL) has also gained 7.5%.

Meanwhile, the Humm Group Ltd (ASX: HUM) share price is sporting a whopping 22% gain, spurred by a 22% surge on Monday.

The BNPL sector’s movements might be a simple correction following last Friday’s devastating blow.

This time last week, many ASX BNPL stocks were tumbling amid news the US Consumer Financial Protection Bureau called on 5 of the sector’s largest participants to help investigate its concerns about the industry.

However, the Afterpay share price might be being spurred by international happenings this week.

The company’s future acquirer, Block Inc (NYSE: SQ) (formerly named Square), has seen its share price gain 5.9% since Monday’s close after starting the week with a 5.2% dip.

As Afterpay’s planned takeover is an all-scrip deal, the value of its acquisition is dependent on the Block share price. Therefore, they tend to move in unison.

However, despite this week’s uptick, the Afterpay share price is still firmly in the long-term red.

It has fallen 26% since the start of 2021. It’s also 19% lower than it was this time last month.

The post Why has the Afterpay (ASX:APT) share price gained 5% this week? appeared first on The Motley Fool Australia.

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Motley Fool contributor Brooke Cooper has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns and has recommended AFTERPAY T FPO, Block, Inc., and ZIPCOLTD FPO. The Motley Fool Australia owns and has recommended AFTERPAY T FPO. The Motley Fool Australia has recommended Humm Group Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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