Another week full of news and views…

Don’t let Black Friday push you into the red

Well, it’s a month today until Christmas (sorry!).

And today’s also ‘Black Friday’ – a ‘sales event’ we’ve inherited from the Yanks that our retailers will happily use to get us to buy stuff.

It’s followed by Cyber Monday in a few days’ time. And ditto.

Now, I own some retail shares. So, you know, if you’re going to spend anyway…

I’m kidding. I actually don’t want you to spend. At least, not unless you were going to buy the thing anyway.

By all means, get something on special today that you were going to buy on Tuesday. Or save a few bob on the kids’ Christmas presents by buying them early.

But please resist the urge for that extra bit of ‘retail therapy’.

No, I’m not (just) trying to be a killjoy.

First, the RBA couldn’t be clearer – if we keep spending, they’ll keep jacking up rates.

Second, most of the dopamine-hit consumption is going to be on stuff you’ll throw out soon enough anyway.

But third, and most importantly, did you know that $200 feel-good purchase you make today could instead be $2,800 in 30 years time, if it was compounded at 9%, roughly in line with historical sharemarket returns?

You didn’t? Well now you do. And if you earn 9% on that $2,800, that’s $250 you could spend every single year thereafter!

Seriously. Stop spending. You don’t need the stuff, and ‘future you’ will thank you.

Bank CEOs’ full-court press

Tell you what, that bankers lobby seems to pack a punch, huh? Labor and the Greens had agreed on legislation that would make bank bosses personally liable – with a $1.1 million fine to boot – for their transgressions while in charge.

But at the last minute, the government pulled the bill, apparently after massive pressure from the Fat Cats Union.

Now, I’m not anti-business. Or anti-bank. I’m not even anti-bank-bosses.

But given how systemically important these companies are, and how frequently they’ve been cited in the media and in a little thing called a Royal Commission… don’t you reckon they could use a little help focussing on some of the deficiencies in their operations?

And be held accountable for their failures, just as they get multi-million dollar bonuses for their successes?

I do. I reckon you do, too. I hope this isn’t more evidence of our politicians ducking the hard issues.

Will Apple take a bite out of Manchester United?

There have been some (unsourced, as far as I can tell) reports that Apple might be interested in buying English soccer team Manchester United, which its owners have put up for sale.

Will it?

I mean, stranger things have happened, but I don’t think it’s likely.

Sports rights? Sure. Entertainment platforms? Yep.

But a single team in a multi-team league?

Again, it’s possible.

But I would suggest Apple will have jumped the shark if they were to do a deal.

Sports teams are – with a very few exceptions – terrible investments. They’re expensive trophy assets for billionaires, mostly.

They are usually not very profitable, the fans are brutal and they’re essentially run under the rules of their sporting organisations (remember when some teams tried to create a breakaway league? That ended badly, and they’re still in the same leagues with the same rules.)

Stranger things could happen than Apple buying Man U. But not much stranger.

We’ll see.

(And having written this, Murphy’s Law may well be brought into force. Apple shareholders might own a soccer team by this time next week!).

Don’t write off online retail

There have been plenty of stories recently about the ‘return to bricks and mortar’. To which, one might ask, ‘why was anything else expected’?

The idea of the ‘new normal’ is seductive, as a story, but the thing about new normals is that they rarely actually happen. Oh, sometimes, of course. Change happens, and will continue to.

But those big ‘this time it’s different’ things? It usually isn’t.

The ‘old normal’ reasserts itself (Remember the ‘inflation is dead’ new normal? Yep…)

We were always going to go back to the shops, just as we were always going to go back to the office.

Sort of.

See, when a tide has gone all the way out – when all but essential workers were shopping and working from home – what else was going to happen, except that the tide was going to start heading in again?

But that’s only part of the story.

“Tide goes back in again” isn’t a revelation.

Nor is “people go back to the shops”.

But just as the tide won’t stay in, I don’t think the question of ‘clicks versus bricks’ has been settled.

Just recently, we’ve seen businesses as diverse as JB Hi-Fi Limited (ASX: JBH), Myer Holdings Ltd (ASX: MYR) and Premier Investments Limited (ASX: PMV) record huge growth in their online sales, even as, yes, people go back to the shops.

And, though I’m loath to bring up something as politically charged as climate change, it’s a good analogy.

Yes, on a daily, weekly or monthly (and certainly, seasonally) basis, temperatures go up and down. But, overall, they continue to rise.

And I think that’s true of eCommerce, too. COVID is weather, but the trend, overall, is climate.      

Online retail will continue to grow. And grow.

Don’t get caught mistaking short-term cyclicality for longer term structural change.

Quick takes

Overblown: Other than the ‘return to the shops’ narrative I mentioned above, the other thing I’m seeing and hearing a lot is people trying to pick stocks for the ‘x’ environment. Higher inflation. Higher rates. Recession. All reasonable questions, but I have two criticisms. First, we just don’t know exactly what’s going to happen. How high? Will there be a recession? For how long? Etc etc. But second, a lot of those assumptions are already baked into share prices. That is, the market is probably making the same assumptions you are, so there’s no advantage to be had in answering the same questions in the same way! You should be looking for areas the market is getting wrong, not ways to come up with the same conclusions.

Underappreciated: Small wins. This is a theme I’ll return to, periodically, but remember that the world gets slightly better every day. Usually in imperceptible increments that go unreported. If you’re only looking at the bad news headlines you’ll miss it. The best bit? The small improvements tend to be permanent, but the bad news tends to be temporary. Not always, and it’s not guaranteed, but don’t forget that things tend to keep getting better.

Fascinating: This also isn’t new, but it’s remarkable how quickly sentiment turns on the share market. From ‘we’ll all doomed’ to ‘the best month for the Dow in history’ and now to six-month highs for the ASX. And it can turn just as quickly. I hope it reminds you that trying to ‘time the market’ is as silly as it sounds!

Where I’ve been looking: This isn’t supposed to be an ad, but my team at Motley Fool Share Advisor and I have been reviewing our scorecard, with some upgrades (and some downgrades, in all probability) to come in the next week or so. There are some great quality businesses that the market is offering us on the cheap, and you don’t always have to go for ‘novelty’. The lesson? Read on…

Quote: “The best stock to buy may be the one you already own.” – Peter Lynch

Fool on!

The post Don’t let Black Friday put you into the red! appeared first on The Motley Fool Australia.

(function() {
function setButtonColorDefaults(param, property, defaultValue) {
if( !param || !param.includes(‘#’)) {
var button = document.getElementsByClassName(“pitch-snippet”)[0].getElementsByClassName(“pitch-button”)[0];
button.style[property] = defaultValue;
}
}

setButtonColorDefaults(“#0095C8”, ‘background’, ‘#5FA85D’);
setButtonColorDefaults(“#0095C8”, ‘border-color’, ‘#43A24A’);
setButtonColorDefaults(“#fff”, ‘color’, ‘#fff’);
})()

More reading

• Why did ASX 200 retail shares lead the market to fresh 25-week highs today?
• 3 ASX dividend shares I think have supercharged growth potential
• 3 ASX All Ordinaries shares hitting multi-year highs on Tuesday
• Why Liontown, Lovisa, Myer, and Whitehaven Coal shares are pushing higher
• 2 ASX All Ordinaries shares hitting multi-year highs on Monday

from The Motley Fool Australia https://ift.tt/2KW4ua1

The S&P/ASX 200 Index (ASX: XJO) took off once more today. The index closed 0.24% higher at 7,259.5 points – just a freckle off its six-month high. That marks a week-on-week gain of 1.51%.

The Aussie bourse wasn’t influenced by Wall Street on Friday. The New York market had the day off on Thursday as the United States celebrated Thanksgiving.

Interestingly, two of the ASX 200’s most popular sectors tumbled today. The S&P/ASX 200 Materials Index (ASX: XMJ) slumped 1.1% while the S&P/ASX 20 Energy Index (ASX: XEJ) fell 0.3%.

The latter’s tumble came despite relatively flat oil prices. The Brent crude oil price fell 0.3% to US$85.12 a barrel overnight while the US Nymex crude oil price posted a slight gain in after-hours trade, coming in at US$77.96 a barrel.

Fortunately, all other sectors lifted on Friday. The S&P/ASX 200 Consumer Discretionary Index (ASX: XDJ) led the way, gaining 1.1%. The S&P/ASX 200 Utilities Index (ASX: XUJ) also rose 1.4%.

So, with all that in mind, which ASX 200 stock posted the highest gain to end the week? Keep reading to find out.

Top 10 ASX 200 shares countdown

Today’s top-performing ASX 200 stock was Nanosonics Ltd (ASX: NAN). Its share price soared 11% amid a positive broker note from Ord Minnett, tipping it as a hold with a $4 price target.

Today’s biggest gains were made by these shares:

ASX-listed company	Share price	Price change
Nanosonics Ltd (ASX: NAN)	$4.62	11.06%
Ramelius Resources Limited (ASX: RMS)	$0.925	6.94%
Virgin Money UK CDI (ASX: VUK)	$3.12	6.12%
Megaport Ltd (ASX: MP1)	$6.64	4.4%
Bega Cheese Ltd (ASX: BGA)	$3.49	3.56%
Smartgroup Corporation Ltd (ASX: SIQ)	$4.78	3.46%
AGL Energy Limited (ASX: AGL)	$8.12	3.31%
TechnologyOne Ltd (ASX: TNE)	$13.51	3.21%
Regis Resources Limited (ASX: RRL)	$1.965	3.15%
Harvey Norman Holdings Limited (ASX: HVN)	$4.30	3.12%

Our top 10 shares countdown is a recurring end-of-day summary to let you know which companies were making big moves on the day. Check in at Fool.com.au after the weekday market closes to see which stocks make the countdown.

The post Here are the top 10 ASX 200 shares today appeared first on The Motley Fool Australia.

(function() {
function setButtonColorDefaults(param, property, defaultValue) {
if( !param || !param.includes(‘#’)) {
var button = document.getElementsByClassName(“pitch-snippet”)[0].getElementsByClassName(“pitch-button”)[0];
button.style[property] = defaultValue;
}
}

setButtonColorDefaults(“#0095C8”, ‘background’, ‘#5FA85D’);
setButtonColorDefaults(“#0095C8”, ‘border-color’, ‘#43A24A’);
setButtonColorDefaults(“#fff”, ‘color’, ‘#fff’);
})()

More reading

• Why did ASX 200 retail shares lead the market to fresh 25-week highs today?
• Why is the Allkem share price diving 8% today?
• Brokers name 3 ASX shares to buy today
• Here are the 3 most heavily traded ASX 200 shares on Friday
• Why Nanosonics, Nick Scali, NRW, and Tyro shares are charging higher

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. has positions in and has recommended Harvey Norman Holdings Ltd., MEGAPORT FPO, and Nanosonics Limited. The Motley Fool Australia has positions in and has recommended Harvey Norman Holdings Ltd., Nanosonics Limited, and SMARTGROUP DEF SET. The Motley Fool Australia has recommended MEGAPORT FPO and TechnologyOne Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

from The Motley Fool Australia https://ift.tt/Y97oPbr

It may have been Black Friday in the stores but it’s been a green day on the market with the benchmark S&P/ASX 200 Index (ASX: XJO) lifting to a new 25-week high.

The ASX 200 reached an intraday peak of 7,268.5 points today — up 0.37%. The last time we saw it above that level was on 31 May. It closed a little lower at 7,259.5 points, up 0.24%.

It seems appropriate that on one of the biggest shopping days of the year, the S&P/ASX 200 Consumer Discretionary Index (ASX: XDJ) was the top-performing sector among the ASX’s 11 sectors, up 1.15%.

Why did ASX 200 retail shares take the lead?

A range of ASX 200 retail shares did some heavy lifting for the benchmark index today. The top movers include Harvey Norman Holdings Limited (ASX: HVN) shares, up 3.2% to $4.31.

Super Retail Group Ltd (ASX: SUL), the owner of Supercheap Auto and Rebel, finished 2.06% higher at $10.91.

Shares in shoe retailer Accent Group Ltd (ASX: AX1) were up 1.81% to $1.685. JB Hi-Fi Limited (ASX: JBH) shares were up 1.8% to $44.79.

With inflation and interest rates rising all year, there’s been plenty of fear-mongering about householders needing to tighten their belts.

And sure, that threat is a worry for the economy. After all, the Australian Bureau of Statistics says household consumption is worth about 50% of Australia’s gross domestic product (GDP).

But we’re not seeing any reduction in retail spending yet. The latest ABS figures on retail trade show sales volumes have been growing for four consecutive quarters.

In fact, spending in the September quarter reached a new record level.

But that trade growth is slowing down amid rising prices due to inflation. Retail sales volumes went up by just 0.2% in September, down from 1% in both the June and March quarters.

But consider the impact of Black Friday. The Australian Retailers Association predicts consumers will spend $6.2 billion between Black Friday and Cyber Monday.

Sheesh…

No recession in sight

Harvey Norman executive chair Gerry Harvey says Australia is nowhere near a recession, according to the Australian Financial Review (AFR).

The retail king pointed out that unemployment was still very low, and it was difficult to find staff.

Harvey Norman is a quintessential ASX 200 retail share. The company held its annual general meeting (AGM) yesterday and presented a trading update for FY23.

It revealed a 6.9% global sales revenue bump year over year during the first four months of FY23.

Harvey said:

We’ll have a really strong Christmas, but next year is a great unknown.

I don’t think there’s any doubt as retailers we will be affected, it’s just as a matter of some sectors more than others.

We have 65 per cent of our stores in regional areas, and because agriculture and mining is so strong they shouldn’t be affected as much.

Retail shares ‘way too cheap’

Motley Fool Australia’s chief investment officer Scott Phillips says many high-quality retail shares are “way too cheap right now“.

A number of them are trading on single-digit price-to-earnings (P/E) ratios.

Phillips said ASX investors were too focused on current short-term risks like rising inflation.

He said: “With a long-term lens, I think we’ll look back and see retail on single digit P/Es and say, ‘Man, really?’”.

He used using JB Hi-Fi as an example. It has a P/E today of 9.2, according to the ASX website.

Harvey Norman has a P/E of 6.5, and Super Retail has a P/E of 10.2.

Perhaps this is another reason why ASX 200 retail shares lead the market today.

Perhaps value investors are looking into ASX 200 retail shares since the Reserve Bank of Australia has reduced its monthly rate rise increments.

The RBA increased rates by 0.25% this month and in October, following four consecutive months of 0.5% rises.

The market was also surprised by a lower-than-expected increase in inflation in the United States this month.

The post Why did ASX 200 retail shares lead the market to fresh 25-week highs today? appeared first on The Motley Fool Australia.

(function() {
function setButtonColorDefaults(param, property, defaultValue) {
if( !param || !param.includes(‘#’)) {
var button = document.getElementsByClassName(“pitch-snippet”)[0].getElementsByClassName(“pitch-button”)[0];
button.style[property] = defaultValue;
}
}

setButtonColorDefaults(“#0095C8”, ‘background’, ‘#5FA85D’);
setButtonColorDefaults(“#0095C8”, ‘border-color’, ‘#43A24A’);
setButtonColorDefaults(“#fff”, ‘color’, ‘#fff’);
})()

More reading

• Why is the Allkem share price diving 8% today?
• Brokers name 3 ASX shares to buy today
• Here are the 3 most heavily traded ASX 200 shares on Friday
• ASX 200 company banned from selling its products. Here’s why
• 8%+ dividend yields! 3 ASX 200 shares I’d snap up to beat inflation

Motley Fool contributor Bronwyn Allen has positions in Harvey Norman Holdings Ltd. and Super Retail Group Limited. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Harvey Norman Holdings Ltd. and Super Retail Group Limited. The Motley Fool Australia has positions in and has recommended Harvey Norman Holdings Ltd. and Super Retail Group Limited. The Motley Fool Australia has recommended Accent Group and JB Hi-Fi Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

from The Motley Fool Australia https://ift.tt/Ck31OAs

The Allkem Ltd (ASX: AKE) share price has fallen precariously into the red today.

Shares in the lithium explorer are currently sliding 8.61% lower to trade at $13.17 apiece, after touching an intraday high of $14.48 near the open.

Putting weight on Allkem’s share price is the fact that materials is today’s worst-performing sector. The S&P/ASX 200 Materials Index (ASX: XMJ) is down 1.09% at the time of writing.

Adding to this is that a good number of Allkem’s ASX lithium share peers are also showing red this afternoon. Here’s a snapshot of how they’re doing as the market close draws near:

• Mineral Resources Limited (ASX: MIN) down 6.63%
• Core Lithium Ltd (ASX: CXO) down 5.65%
• Pilbara Minerals Ltd (ASX: PLS) down 7.1%

The broader market is also having a not-so-stellar session as the S&P/ASX 200 Index (ASX: XJO) is laying almost flat with a 0.19% gain for the day.

So why are lithium shares like Allkem performing poorly on Friday? Let’s investigate.

What’s going on with the Allkem share price?

Adding to the selling pressure on lithium shares like Allkem today is news that the lithium price may have hit a price ceiling, according to data from Trading Economics.

Prices for the commodity are creeping away from the recent high of CNY 600,000 per tonne on 11 November. It has since fallen 1.58% to CNY 590,500, effectively ending that lithium price rally.

The lithium commodity price has been on an enormous bull run year-to-date, gaining 113% during this period.

Supporting the price rise were subsidies for electric vehicles issued by the Chinese government, which were set to expire at the end of 2022. However, China Briefing reported in September that the government had exempted buyers of electric vehicles from paying vehicle purchase tax starting 1 January next year, lasting until 31 December.

Lithium commodity price could fall lower

These subsidies haven’t stopped analysts at Goldman Sachs from giving the lithium commodity price a bearish outlook starting in 2023, however.

My Fool colleagues in the US noted last week that the bank believes the sale of electric vehicles is set to slow down next year, which could lead to an oversupply of lithium and thus put downward pressure on the commodity’s price.

It was also noted that a cathode manufacturer in China was rumoured to have cut its production targets in anticipation of a slowdown in demand for its output.

So it appears the lithium commodity price is being hit from a couple of different angles, thus putting pressure on the share prices of lithium producers such as Allkem.

Allkem share price snapshot

The Allkem share price is up 26.8% year to date. That’s beating the ASX 200 by a substantial margin, as the index is down 2.53% over the same period.

The company’s market capitalisation is around $9.18 billion.

The post Why is the Allkem share price diving 8% today? appeared first on The Motley Fool Australia.

(function() {
function setButtonColorDefaults(param, property, defaultValue) {
if( !param || !param.includes(‘#’)) {
var button = document.getElementsByClassName(“pitch-snippet”)[0].getElementsByClassName(“pitch-button”)[0];
button.style[property] = defaultValue;
}
}

setButtonColorDefaults(“#0095C8”, ‘background’, ‘#5FA85D’);
setButtonColorDefaults(“#0095C8”, ‘border-color’, ‘#43A24A’);
setButtonColorDefaults(“#fff”, ‘color’, ‘#fff’);
})()

More reading

• Here are the 3 most heavily traded ASX 200 shares on Friday
• Why City Chic, Deep Yellow, Objective Corp, and Pilbara Minerals shares are falling
• What could be sending the Pilbara Minerals share price 7% lower today?
• Here’s why ASX 200 lithium shares are ending the week with a fizzle
• ASX 200 company banned from selling its products. Here’s why

Motley Fool contributor Matthew Farley has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

from The Motley Fool Australia https://ift.tt/7pXBPMJ