Zip share price jumps 14% ahead of tomorrow’s update

a woman looks at her phone while making a transaction at the counter of a store where racks of clothing can be seen in the background.

a woman looks at her phone while making a transaction at the counter of a store where racks of clothing can be seen in the background.The Zip Co Ltd (ASX: ZIP) share price is having much-needed positive day.

In afternoon trade, the buy now pay later (BNPL) provider’s shares are up a massive 14% to 67.5 cents.

What’s going on with the Zip share price?

The catalyst for the rise in the Zip share price has been a rebound in the tech sector.

This rebound has been particularly strong among beaten down loss-making tech shares like Zip.

For example, the Life360 Inc (ASX: 360) share price is currently up 6%, the PointsBet Holdings Ltd (ASX: PBH) share price is up 9%, and the BrainChip Holdings Ltd (ASX: BRN) share price is up 12% at the time of writing.

This has driven the S&P ASX All Technology index 4% higher today.

What’s driving tech shares higher?

Investors have been piling into the tech sector on Wednesday following a very strong night of trade on the tech-focused NASDAQ index.

This was driven by optimism that markets have now bottomed and it is onwards and upwards from here.

Among the best performers on the NASDAQ index was the Affirm share price with a 9% gain. Investors appear to believe this BNPL share has been oversold and created a buying opportunity.

The same seems to be happening on the Australian share market with the Zip share price.

Quarterly update

The Zip share price will be in focus again on Thursday when the company releases its quarterly and full year update.

In respect to its full year performance, according to note out of Macquarie, its analysts are expecting Zip to report a 59.9% increase in revenue to $644.24 million in FY 2022.

And while it is unlikely to release an update on its earnings until next month, the broker has pencilled in an EBITDA loss of $201.8 million for the year.

The post Zip share price jumps 14% ahead of tomorrow’s update appeared first on The Motley Fool Australia.

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Motley Fool contributor James Mickleboro has positions in Life360, Inc. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Life360, Inc., Pointsbet Holdings Ltd, and ZIPCOLTD FPO. The Motley Fool Australia has recommended Pointsbet Holdings Ltd. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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