Author: openjargon

There are plenty of ASX dividend shares to choose from on the local market.

But which ones could be best buys?

To narrow things down, let’s look at two that Bell Potter has on its Australian equities panel.

These are equities that the broker believes offer attractive returns over the long term.

Here are two ASX dividend shares it is tipping as buys:

Elders Ltd (ASX: ELD)

Bell Potter thinks this agribusiness company’s shares are undervalued at current levels.

In addition, it highlights Elders’ strong dividend yield as a reason to buy. It said:

We see value in ELD, particularly with the market appearing to undervalue the pending Delta acquisition. The base business is performing well with multiple growth drivers including recovery from drought conditions, system modernisations, and backward integration benefits. We are attracted to ELD’s valuation, which is relatively cheap at 12x 12MF P/E, along with these potential upside catalysts and a strong dividend yield.

The broker is forecasting fully franked dividends of 39 cents per share in FY 2026 and then 45 cents per share in FY 2027. Based on its current share price of $7.35, this would mean dividend yields of 5.3% and 6.1%, respectively.

Bell Potter has a buy rating and $9.00 price target on Elders’ shares.

Nick Scali Limited (ASX: NCK)

Another ASX dividend share that Bell Potter is bullish on is furniture retailer Nick Scali.

It believes the company is well-placed for growth given its UK rollout. It said:

Nick Scali is an Australian retailer specialising in household furniture and related accessories, operating under the core Nick Scali brand as well as the Plush banner. >90% of sales are completed in-store, with the company maintaining a substantial physical presence with over 100 showrooms across Australia and New Zealand, and has recently expanded into the UK, which now contributes around 8% of total revenue.

Looking ahead, the key growth drivers include the continued roll-out of Nick Scali stores in the UK, supported by the refurbishment of acquired Fabb locations, and the ability to leverage the group’s established supply base to drive scale efficiencies and margin expansion.

As for income, the broker is forecasting fully franked dividends of 61.9 cents per share in FY 2026 and then 75.1 cents per share in FY 2027. Based on its current share price of $14.93, this would mean dividend yields of 4.15% and 5%, respectively.

Bell Potter has a buy rating and $25.00 price target on Nick Scali’s shares.

The post Bell Potter names the best ASX dividend shares to buy appeared first on The Motley Fool Australia.

More reading

• Forget Westpac shares, I’d buy these ASX dividend stocks
• Would Warren Buffett buy this ASX 200 share?
• 3 ASX shares Bell Potter rates as top buys
• A rare buying opportunity to buy 1 of Australia’s top shares?
• Got $7,500? Here are 2 strong ASX retail stocks to buy now

Motley Fool contributor James Mickleboro 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 recommended Elders and Nick Scali. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

ASX All Ords stocks are a great hunting ground for opportunities because they can deliver much more growth than an ASX blue-chip share. The All Ordinaries (ASX: XAO) is full of interesting names.

Smaller businesses are much earlier in their growth journey, but are typically undervalued by the market for their potential earnings growth. When we pick the right names, it can lead to strong, market-beating returns.

If I were looking to beat the market, the two names below are ones I’d consider.

Aeris Resources Ltd (ASX: AIS)

Aeris describes itself as an Australian mid-tier copper and gold producer. It has two copper projects, expected to deliver between 40kt and 49kt in FY26.

On top of that, the business has multiple development projects, and it’s also investing in exploration. This gives it a strong platform for growth over the longer-term.

I’m expecting copper prices to rise over the longer term due to rising demand, driven by global electricity grid expansion, electric vehicles, data centres, renewable energy, batteries, and so on.

The FY26 half-year result showed how the business can deliver improving profitability amid higher commodity prices – revenue grew by 4.6%, gross profit increased 57% to $93.5 million, net profit after tax (NPAT) rose 62% to $47.9 million, and operating cash flow surged 67% to $97.3 million.

The Aeris Resources share price is down by 46% since January 2026, making it a much cheaper buy.

According to the forecast on CMC Invest, the ASX All Ords stock is now valued at just 2x FY26’s estimated earnings.

Australian Ethical Investment Ltd (ASX: AEF)

Australian Ethical is a fund manager that aims to provide investors with investment options that align with their ethical beliefs about what they would and wouldn’t want to invest in.

For example, it avoids certain industries, such as fossil fuels, nuclear, and tobacco, while actively supporting positive ones, such as renewable energy, healthcare, IT, and others.

One of the most appealing aspects of Australian Ethical as an investment is its superannuation offering. This offers both long-term funds under management (FUM) and growth from regular superannuation contributions.

For example, in the FY26 third quarter, the business reported net inflows of $0.1 billion, with the vast majority coming from the superannuation channel. Short-term market volatility can affect FUM and the earnings trajectory, but a sell-off can be an opportunity for a rebound.

At the end of March, Australian Ethical expanded its private markets offering with the launch of the Australian Ethical Growth Opportunities Fund. This provides wholesale investors with access to long-term, ethically aligned private-market investments. The new fund has received a cornerstone institutional commitment of up to $125 million from the Clean Energy Finance Corporation (CEFC).

According to the forecast on CMC Invest, the ASX All Ords stock is valued at 20x FY26’s estimated earnings.

The post 2 wonderful ASX All Ords stocks I’d buy today appeared first on The Motley Fool Australia.

More reading

• Bell Potter names the best ASX dividend shares to buy
• Lest We Forget
• Almost ready to retire? I’d buy cheap ASX dividend shares for passive income
• 3 ASX ETFs with market-beating potential over the next 10 years
• Here are the top 10 ASX 200 shares today

Motley Fool contributor Tristan Harrison 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 Australian Ethical Investment. The Motley Fool Australia has recommended Australian Ethical Investment. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Duty.

The word might seem old-fashioned these days, in what can often feel like a me-first world.

It invokes a responsibility not just to ourselves, but to others. To do the right thing.

And it elicits the idea of sacrifice. After all, we don’t need to promise to do the things we want to do – but to do the things we ought to do, even when we might prefer not to, or prefer to do something else.

Today is ANZAC Day.

It is the day, 111 years ago, that soldiers of the Australian and New Zealand Army Corps landed on a beach in Suvla Bay in the Dardanelles Strait. It was a strategic sea transport lane that the Allies were determined to keep open, and hopefully use as a prelude to capturing Istanbul, then known as Constantinople, the capital of the Ottoman Empire.

A day that would become immortalised in Australian and New Zealand history, and serve as our pre-eminent day of remembrance for all Australian and New Zealand soldiers, sailors and aviators, and those of our allies, who served, suffered and died in the service of our countries in wars and warlike conflicts.

Those who were doing their duty.

From the cities and the bush. Old and young. Black and white. Rich and poor. Volunteer and conscript.

They put on our nation’s uniform and served their country faithfully.

Some did not return, and are buried in war graves, mostly overseas. We remember them today.

We also remember those who came home, but who returned with physical, mental and emotional injuries. Who left the war, but whom the war never left.

We remember those whose emotional injuries were so severe that ending their own lives was preferable to living with the pain.

They all did their duty, in our name.

We remember, because it is our duty.

Remembrance isn’t about glorifying war. It’s not about the conflicts themselves at all.

It is about those Australians, New Zealanders and those of our wartime allies who put themselves in harm’s way because their country asked them to.

It is our responsibility – our duty – to pause and reflect. To remember.

Not just the gallant acts of incredible bravery. Though we remember them.

Not just the battles won against fierce odds. Though we remember them, too.

We remember the ordinary serviceman and woman who donned their uniform and followed orders, because that’s what they were asked to do.

Who felt fear. Who knew horror. Who served with distinction and honour, even though at times they would have felt, with every fibre of their being, that they would rather have been anywhere else.

Who did their duty, simply because it was their duty, and they believed it was the right thing to do.

And that’s why it’s our duty to remember.

After the Ode of Remembrance is recited across the country at ANZAC services, today, attendees will observe a period of silence.

In the stillness, we will contemplate the sacrifices made by our service personnel. Our fellow Australians, who, in years past, did their duty. Often at great personal cost, some making the supreme sacrifice.

We will remember those who, often in the youthful prime of their lives, did their duty, regardless of that personal cost.

And so, we will do our duty. We will remember them.

They went with songs to the battle, they were young,

Straight of limb, true of eye, steady and aglow.

They were staunch to the end against odds uncounted:

They fell with their faces to the foe.

They shall grow not old, as we that are left grow old:

Age shall not weary them, nor the years condemn.

At the going down of the sun and in the morning

We will remember them.

Lest We Forget

The post Lest We Forget appeared first on The Motley Fool Australia.

More reading

• Bell Potter names the best ASX dividend shares to buy
• 2 wonderful ASX All Ords stocks I’d buy today
• Almost ready to retire? I’d buy cheap ASX dividend shares for passive income
• 3 ASX ETFs with market-beating potential over the next 10 years
• Here are the top 10 ASX 200 shares today

Motley Fool contributor Scott Phillips 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.

Getting close to retirement changes how I think about investing.

Income starts to matter more, and I want that income to be as reliable as possible. At the same time, I still want the portfolio to hold up over the long term.

Here is how I would approach buying ASX dividend shares for passive income at this stage.

Focus on the starting yield

The price you pay matters more when you are investing for income.

Buying ASX shares after a pullback can lift the dividend yield and improve the income from day one. That is why I pay close attention to companies trading below their usual levels.

For example, when a business like Harvey Norman Holdings Ltd (ASX: HVN) falls well below its highs, the potential yield on offer with its shares can become very generous.

In fact, according to CommSec consensus estimates, Harvey Norman shares are expected to offer a dividend yield of around 8% in FY27.

Look for businesses that can keep paying

A high dividend yield is only useful if it can be sustained.

I focus on companies that generate consistent cash flow and have a track record of paying dividends through different conditions. That often leads me toward businesses with strong positions in their markets.

Wesfarmers Ltd (ASX: WES) is a good example of this. The Bunnings and Kmart owners’ earnings are supported by demand that tends to hold up well in most economic environments, which helps underpin regular and growing dividends.

Diversify

I think a balanced income portfolio is important.

An easy way to achieve this is with an exchange-traded fund (ETF) like the Vanguard Australian Shares High Yield ETF (ASX: VHY) or the Betashares S&P Australian Shares High Yield ETF (ASX: HYLD).

They allow you to buy a large group of ASX dividend shares through a single investment. This provides almost instant diversification to a passive income portfolio.

Keep it manageable

As retirement approaches, simplicity becomes more important.

I would rather own a handful of income-producing ASX shares that I understand than a large number of positions that are harder to follow. That makes it easier to track performance and stay confident in the portfolio.

Foolish Takeaway

I think building a passive income portfolio comes down to buying the right shares at the right price and holding them over time.

A mix of reliable dividend payers and opportunities created by share price weakness can help build a steady income stream, which is what I would focus on as I get close to retirement.

The post Almost ready to retire? I’d buy cheap ASX dividend shares for passive income appeared first on The Motley Fool Australia.

More reading

• How to generate monthly income using ASX ETFs
• Where I’d invest my first $500 into ASX shares
• Down 40%: These high-yield ASX dividend shares are rated as buys
• 5 ASX dividend shares I’d buy for a second income
• 1 ASX dividend stock down 18% — I’d buy right now

Motley Fool contributor Grace Alvino has positions in Wesfarmers. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Wesfarmers. The Motley Fool Australia has positions in and has recommended Harvey Norman. The Motley Fool Australia has recommended Vanguard Australian Shares High Yield ETF and Wesfarmers. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Outperforming the market over long periods often comes down to backing the right parts of the economy early and staying invested.

Broad index exchange traded funds (ETFs) tend to reflect where the market is today. More targeted ETFs can tilt towards where growth and returns may come from over the next decade.

Here are three ASX ETFs that offer that potential and were recently recommended by the team at BetaShares:

BetaShares Nasdaq 100 ETF (ASX: NDQ)

The first ASX ETF that could be a market-beater is the BetaShares Nasdaq 100 ETF.

This fund leans into companies that are shaping consumer behaviour and digital infrastructure. It is less about the overall economy and more about where innovation is happening at scale.

Its holdings include companies such as Netflix (NASDAQ: NFLX), Adobe (NASDAQ: ADBE), and Tesla (NASDAQ: TSLA).

Adobe is a good example of how these businesses evolve over time. It has transitioned from one-off software sales to a subscription-based model, creating recurring revenue and improving margins. That ability to adapt is a common feature across many Nasdaq leaders.

With technology continuing to influence how industries operate, the BetaShares Nasdaq 100 ETF could be an ETF to hold for the long term.

BetaShares Global Robotics and Artificial Intelligence ETF (ASX: RBTZ)

Another ASX ETF to look at is the BetaShares Global Robotics and Artificial Intelligence ETF.

This ETF focuses on automation, which is a theme that is becoming more important as companies look to improve productivity and reduce reliance on labour.

Its holdings include companies such as Fanuc Corporation (TYO: 6954), Intuitive Surgical (NASDAQ: ISRG), and Keyence Corporation.

Keyence stands out for its high-margin business model. It develops sensors and automation equipment used in manufacturing, with a strong focus on efficiency and precision. Its products are embedded in production processes, which can make demand more resilient over time.

As automation expands across industries, the BetaShares Global Robotics and Artificial Intelligence ETF could be destined to outperform over the long term.

BetaShares Asia Technology Tigers ETF (ASX: ASIA)

A final ASX ETF worth considering for the long term is the BetaShares Asia Technology Tigers ETF.

This ETF provides exposure to large technology companies across Asia, where digital adoption continues to accelerate.

Its holdings include companies such as Meituan (SEHK: 3690), PDD Holdings (NASDAQ: PDD), and Samsung Electronics.

Meituan is an interesting one. It operates a platform that connects consumers to services such as food delivery and local retail, building scale through network effects. Its growth reflects how digital ecosystems are developing differently across Asia.

With innovation and consumption trends continuing to evolve in the region, the BetaShares Asia Technology Tigers ETF could be a top long-term pick.

The post 3 ASX ETFs with market-beating potential over the next 10 years appeared first on The Motley Fool Australia.

More reading

• Global investing is easy on the ASX with these ETFs
• Are these the best ASX ETFs to buy with $1,000 in May?
• Global X says it’s time to target this electric vehicle ASX ETF that has doubled in a year
• Wondering which ASX ETFs to buy? Try these top picks
• Best and worst case scenarios this week for global equities: Expert

It was a lacklustre finish to what has been a rather rough trading week for the S&P/ASX 200 Index (ASX: XJO) this Friday.

After a shaky and volatile session that saw the index whipsaw quite a lot, the ASX 200 ended up closing 0.078% lower by the time the markets closed up shop. That leaves the index at 8,786.5 points as we head into the weekend.

This inglorious end to the trading week for ASX investors follows a red night up on Wall Street.

The Dow Jones Industrial Average Index (DJX: .DJI) wasn’t in a good mood, shedding 0.36%.

The tech-heavy Nasdaq Composite Index (NASDAQ: .IXIC) fared worse, though, dropping by 0.89%.

But let’s return to the local markets now and see how the various ASX sectors ended their respective weeks today.

Winners and losers

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

More reading

• ASX 200 drops again. This is what’s starting to worry investors
• ASX 200 energy shares lift as pessimism over Iran war deepens
• Why Newmont, Nuix, PLS, and Vulcan Energy shares are rising today
• This ASX lithium stock is bouncing back today. Here’s why
• 3 ASX 200 shares too cheap to ignore after sell-offs

Motley Fool contributor Sebastian Bowen 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 Telix Pharmaceuticals. The Motley Fool Australia has recommended Data#3 and Telix Pharmaceuticals. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

If you are looking for some big potential returns for your investment portfolio, then it could pay to hear what Morgans is saying about the two ASX 200 shares in this article.

That’s because the broker believes these shares are cheap and have the potential to rise around 50% from where they trade today.

Let’s see what the broker is recommending to clients this week:

Collins Foods Ltd (ASX: CKF)

Morgans thinks this quick service restaurant operator’s shares are undervalued at current levels.

The broker has a buy rating and $12.50 price target on its shares. Based on its current share price of $8.29, this implies potential upside of 50%.

Commenting on its buy recommendation, Morgans said:

We revise our CKF forecasts ahead of the FY26 result in June, trimming underlying NPAT to reflect deferred store openings, reset German acquired store economics, and a lower EU SSS assumption to better capture the Netherlands-skewed mix for FY26, partially offset by a marginal AU SSS upgrade on sustained KFC Australia momentum. We maintain our BUY recommendation and reduce our price target to $12.50 (from $12.70).

Pro Medicus Ltd (ASX: PME)

Another ASX 200 share that Morgans is recommending to clients is health imaging technology company Pro Medicus.

After making adjustments to its financial model for Pro Medicus, the broker has retained its buy rating with a $210.00 price target. Based on its current share price of $138.73, this implies potential upside of 51% for investors between now and this time next year.

Morgans has been impressed with Pro Medicus’ contract wins since the release of its half-year results in February and remains very positive on its long-term growth opportunity. It explains:

In this note, we deploy a new PME model where we have deliberately set a lower bar. Our remodelled estimates prioritise achievability over optimism, staging implementation revenue conservatively and mark FX to spot. We see this as the right framework for a stock where sentiment has been fragile. On the business operations front, the story remains untarnished.

Contract newsflow since February has been exceptional: ~$100m in wins and renewals, all at higher pricing, with cardiology upsell gaining traction. The demand story is not in question. We re-emphasise our positive long-term conviction on the name although lower our valuation to reflect current but potentially fleeting headwinds. Our target price is reduced to A$210 p/s and we retain our Buy recommendation.

The post 2 ASX 200 stocks that could rise 50% appeared first on The Motley Fool Australia.

More reading

• I was going to buy these ASX tech stocks. Now, I’m not so sure
• 3 amazing ASX growth shares that continue to stand out
• Why I’d invest $2,500 in Life360 and Pro Medicus shares today
• What on earth’s going on with Pro Medicus shares?
• Are Pro Medicus shares a buy right now?

Motley Fool contributor James Mickleboro has positions in Collins Foods and Pro Medicus. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended Pro Medicus. The Motley Fool Australia has recommended Collins Foods and Pro Medicus. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Back in January, I wrote a piece that named two ASX tech stocks as the top of my buy list if the share market experienced a crash in 2026.

Those two ASX tech stocks were TechnologyOne Ltd (ASX: TNE) and Pro Medicus Ltd (ASX: PME). These companies are two of Australia’s finest. Both have consistently delivered for shareholders over recent years and boast enviable stock price trajectories.

At the time, I outlined my view that if these companies descended to a price point that indicated significant potential value, then I would be tempted to load the boat.

However, I must confess that my faith has been shaken.

As I’ve already touched on, both of these companies are proven winners. TechnologyOne prides itself on its enterprise software products, which have proven wildly popular with governments and businesses in Australia and overseas.

Pro Medicus is also in the software space. Its medical imaging services are in high demand worldwide.

Both companies continue to report happy numbers.

For example, in February, Pro Medicus delivered a 29.7% surge in underlying profits for the six months to 31 December 2025 to $90.7 million.

What’s got me sour on these two ASX tech stocks?

So why the loss of faith? Well, it’s to do with artificial intelligence (AI). Yes, we’ve known about the potential upsides, as well as the potential disruption, of AI technology for a while now. That said, it has recently become clearer that enterprise software stocks face a particularly high level of disruptive risk from AI.

Now, I am no AI expert. But I do see the potential for disruption here. AI tools are becoming better and better at solving enterprise problems that (expensive) software currently handles. Anecdotally, I have already heard several stories of AI rendering business software subscriptions redundant.

There’s every chance that TechnologyOne and Pro Medicus will be able to stay ahead of the curve and evolve and adapt to the threats of AI. But I am not certain of that, not enough to bet my dollars on it anyway.

Warren Buffett once said that “I don’t look to jump over seven-foot bars, I look around for one-foot bars that I can step over”. These two ASX tech stocks are looking increasingly tall in this modern age of AI, at least in my eyes. As such, I’ll probably stick to shorter stocks to step over, at least for now.

The post I was going to buy these ASX tech stocks. Now, I’m not so sure appeared first on The Motley Fool Australia.

More reading

• 6 ASX 200 shares downgraded by brokers this week
• 3 amazing ASX growth shares that continue to stand out
• Why I’d invest $2,500 in Life360 and Pro Medicus shares today
• 3 stellar ASX growth shares to buy now with 30% to 70% upside
• What on earth’s going on with Pro Medicus shares?

Motley Fool contributor Sebastian Bowen 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 Technology One. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended Pro Medicus. The Motley Fool Australia has recommended Pro Medicus and Technology One. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

It has been another busy week for many of Australia’s top brokers. This has led to a number of broker notes being released.

Three broker buy ratings that you might want to know more about are summarised below. Here’s why brokers think these ASX shares are in the buy zone right now:

DroneShield Ltd (ASX: DRO)

According to a note out of Bell Potter, its analysts have retained their buy rating and $4.80 price target on this counter-drone technology company’s shares. This follows the release of a strong first-quarter update which revealed revenue up 121% on the prior corresponding period. Bell Potter was also pleased to see that SaaS revenue continues to grow strongly and now represents 6.9% of revenue. Looking ahead, the broker believes DroneShield has a market leading offering and a strengthening competitive advantage. This leaves it well-placed ahead of an expected wave of spending on these types of solutions. As a result, Bell Potter believes DroneShield should see material contracts flowing from its $2 billion+ potential sales pipeline over the next three to six months. The DroneShield share price is trading at $3.73 on Friday.

Generation Development Group Ltd (ASX: GDG)

A note out of Morgans reveals that its analysts have retained their buy rating on this diversified financial services company’s shares with a trimmed price target of $6.16. This follows the release of a solid quarterly update earlier this week. Morgans highlights that once again, the Investment Bond business delivered ahead of expectations. However, taking some of the shine off the result was the softer than expected performance from the Evidentia business. And while the latter has caused the broker to trim its earnings forecasts, it remains positive on Generation Development Group. This is largely due to its exposure to structural growth areas, and its strong competitive positioning in these markets. The Generation Development Group share price is fetching $3.54 at the time of writing.

WiseTech Global Ltd (ASX: WTC)

Another note out of Morgans reveals that its analysts have retained their buy rating on this logistics solutions technology company’s shares with a reduced price target of $70.40. Morgans has made significant changes to its technology coverage, lowering valuations to reflect higher discount rates and uncertainty over terminal values due to AI disruption. Despite this, the broker remains very positive on WiseTech Global and has named it as one of its key picks in the sector. The WiseTech Global share price is trading at $44.17 on Friday afternoon.

The post Brokers name 3 ASX shares to buy right now appeared first on The Motley Fool Australia.

More reading

• Up 209%, what’s next for DroneShield shares?
• Could these ASX stocks really be set to double after crashing this week?
• 2 top ASX shares down over 50% to buy now
• 5 ASX 200 shares with renewed buy ratings this week
• Will global defence ASX ETFs keep climbing? Expert

Motley Fool contributor James Mickleboro has positions in WiseTech Global. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended DroneShield and WiseTech Global. The Motley Fool Australia has positions in and has recommended WiseTech Global. The Motley Fool Australia has recommended Generation Development Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The S&P/ASX 200 Index (ASX: XJO) is yet again under pressure on Friday, with weakness across most sectors weighing on the benchmark.

At the time of writing, the ASX 200 is down 0.53% to 8,746 points. The index briefly traded lower earlier in the session, continuing a softer run into the end of the week.

This follows several days of choppy trading, with news headlines starting to play a bigger role in short-term sentiment.

Here’s what is driving the move.

Oil prices are back in focus

One of the main factors sitting over the market is the recent rise in oil prices.

Brent crude has pushed back above US$106 per barrel, holding near recent highs after a sharp rebound over the past week.

That move has been linked to the ongoing tensions in the Middle East, particularly around supply disruptions and shipping risks.

Keep in mind, higher oil prices tend to act as a huge headwind for equity markets.

They feed into inflation expectations and raise concerns around input costs, which can pressure margins across a wide range of sectors.

And that is showing up in today’s session.

Selling spreads across the ASX

The decline is not being driven by a single sector.

More than half of the ASX sectors are trading lower, with weakness across financials, materials, and consumer-facing businesses.

Large-cap banks are mixed, with the S&P/ASX 200 Financials Index (ASX: XFJ) down around 0.3%.

Miners are under pressure, with the S&P/ASX 200 Resources Index (ASX: XRJ) down roughly 0.8% as commodity prices ease.

Lithium companies have also been weaker, following production updates and ongoing pricing uncertainty.

There are still pockets of strength, though.

Energy stocks are outperforming, with the S&P/ASX 200 Energy Index (ASX: XEJ) up around 1.7%, while S&P/ASX 200 Utilities Index (ASX: XUJ) are also higher, gaining roughly 1.6%.

But unfortunately that has not been enough to offset the wider pullback across the index.

Recent momentum starts to fade

Looking at the recent trend, the ASX 200 had been holding up reasonably well through March and early April.

The benchmark index remains up close to 10% over the past 12 months, supported by gains in large-cap stocks and strong performance from key sectors.

However, the past week has seen momentum start to shift.

The index has pulled back from recent highs and is now tracking lower into the end of the week.

Daily moves have also become more volatile, with buying interest starting to fade.

The post ASX 200 drops again. This is what’s starting to worry investors appeared first on The Motley Fool Australia.

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Motley Fool contributor Aaron Teboneras 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.