Author: openjargon

If you are interested in adding a blue-chip ASX 200 stock to your portfolio, then it could be worth considering Seek Ltd (ASX: SEK) shares.

That’s the view of analysts at Bell Potter, which remains positive on the job listings giant.

What is the broker saying about this popular ASX 200 stock?

Bell Potter highlights that recent economic data remains mixed for SEEK, with interest rate hikes potentially causing headwinds for the company. However, data centre investments and increased discretionary spending are seen as positives. It said:

Recent Australian economic data remains mixed, with a view to an additional RBA rate hike as a headwind for jobs growth, noting some commentary that the current 4.35% cash rate may be the peak; unemployment eased to 4.5% from 4.1% across Jan-May after previously remaining tight through the rate rise cycle (+ve for cuts), GDP came in softer than expected at 0.3% for the March quarter (2.5% YoY) despite $13bn in data centre investment for the quarter (+ve), discretionary spending at+0.1% qtrly growth likely indicates a stretched consumer broadly (+ve), though we anticipate geo-political headwinds continue to flow through the energy-related inflation (-ve).

Clerical/Admin internet job ads have been the most challenged job category declining -3% in April on YoY/R3M/R6M bases and potentially reflects early AI-impact; Professionals, Managers, Technicians/Trades, Labourers, and Sales job ads all grew across the comparable periods.

Should you invest?

According to the note, Bell Potter continues to see value in the ASX 200 stock despite trimming its valuation.

This morning, the broker has retained its buy rating with a reduced price target of $18.60 (from $23.90).

Based on its current share price of $13.68, this implies potential upside of 36% for investors over the next 12 months.

In addition, an attractive 3.8% dividend yield is expected over the forecast period, boosting the total potential return to almost 40%.

Commenting on its recommendation, the broker said:

We maintain our Buy; SEK is our preferred rate-sensitive classifieds exposure looking through to a dovish RBA tilt, given the diversification in CAR and policy-impacted earnings outlook for REA.

Our Target Price is reduced to $18.60sh through earnings changes and an increase in our WACC to 10.3% (prev. 10.2%), a reduction our Growth Fund valuation via Coursera and an increase in Fund discount rate to 30% (prev. 20%) on visibility in PortCo operating performance in an AI-enabled environment. SEK’s underlying proprietary data (~750m points per day) partially consists of traffic meta data which is unable to be scraped by third parties, is valuable for targeted job placements, should support yield through soft volume environments.

The post Bell Potter says this popular ASX 200 stock could deliver a 40% return appeared first on The Motley Fool Australia.

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• Are these the 3 best value ASX 200 shares right now?
• Brokers name 3 ASX shares poised for 52% to 78% gains
• Here are the top 10 ASX 200 shares today
• Job ads rose for the first time in three months. Here is why that is good news for these ASX shares

Motley Fool contributor James Mickleboro has positions in REA Group. 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 CAR Group Ltd. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The Meridian Energy Ltd (ASX: MEZ) share price is in focus after the company’s May 2026 operating report, highlighting record-high financial year-to-date inflows and a robust 7.8% lift in monthly retail sales volumes.

What did Meridian Energy report?

• National hydro storage increased to 125% of the historical average by 8 June 2026.
• May monthly total inflows were 82% of the historical average; year-to-date inflows reached 118% of average (the highest since 1998).
• Waitaki catchment water storage ended May at 106% of the historical average, up 26% year-on-year.
• May retail sales volumes rose 7.8% compared to May 2025, with residential sales up 20.4%.
• Meridian’s total generation for May climbed 12% year-on-year, reflecting higher hydro and lower wind generation.
• Average price received for generation in May was 61.7% lower than the same month last year.

What else do investors need to know?

Meridian reported robust water storage levels, with financial year-to-date inflows at their highest since 1998. These healthy inflows underpin the company’s resilience as winter approaches and there is no indication of significant drought risk for the southern hydro lakes.

While retail customer connections dipped slightly (down 0.8% in May), they are up 14.3% compared to a year earlier. Segment sales growth was broad-based, with gains across residential, small and medium business, large business, agriculture, and corporate segments.

National electricity demand in May 2026 climbed 1.7% year-on-year (0.6% excluding NZ Aluminium Smelters), while the price Meridian received for generation saw a sharp year-on-year fall, tracking the broader drop in New Zealand electricity futures prices.

What’s next for Meridian Energy?

Meridian remains focused on navigating fluctuating weather conditions and electricity prices while maintaining strong hydro storage. With water levels well above historical averages, the company appears well-equipped to manage variable market and weather challenges in the coming months.

Investors can expect continued regular updates, with weekly lake storage figures and further details on market conditions made available on Meridian’s website.

Meridian Energy share price snapshot

Over the past 12 months, Meridian Energy shares have declined 14%, trailing the S&P/ASX 200 Index (ASX: XJO) which has risen 3% over the same period.

View Original Announcement

The post Meridian Energy: May 2026 operating update highlights robust inflows appeared first on The Motley Fool Australia.

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Motley Fool contributor Laura Stewart 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. This article was prepared with the assistance of Large Language Model (LLM) tools for the initial summary of the company announcement. Any content assisted by AI is subject to our robust human-in-the-loop quality control framework, involving thorough review, substantial editing, and fact-checking by our experienced writers and editors holding appropriate credentials. The Motley Fool Australia stands behind the work of our editorial team and takes ultimate responsibility for the content published by The Motley Fool Australia.

The Australian Federal budget last month may have been a big surprise, and investors need to adapt to how they invest in property and other assets.

Changes to negative gearing may make residential less appealing to investors wanting to offset wages and other income.

Of course, we shouldn’t forget that grandfathering arrangements remain in place for residential property that was already owned, buying new builds can still allow rental losses to offset wages and other income, and rental losses on newly-bought existing properties can offset future profits from that property.

But, the capital gains tax changes may make residential property less appealing to investors.

Having said all of that, I can understand why some investors are now not as enthusiastic about residential property as before. But, I don’t believe Australians should ignore property entirely.

There’s one area of the property market I’m very optimistic about for the long-term: real estate investment trusts (REITs).

Why REITs are my go-to for property investing

Commercial properties are a huge class of assets that allow investors to buy real estate across industrial warehouses, shopping centres, office buildings, storage units, farmland, childcare centres, medical buildings, hotels and pubs, service stations and so on.

A typical REIT generates compelling rental profits each year, allowing it to pay a sizeable distribution to investors. It’s the opposite of negative gearing – we can receive pleasing payouts while (hopefully) watching the real estate go up in value over time.

For me, it’s most appealing to look at areas of the market that are seeing positive, sustainable rental growth because that’s what will fund higher distributions and increase the value of the properties.

It could also be a good time to look at the sector because higher interest rates are a temporary headwind, but falling interest rates could turn into a tailwind.

My picks in the sector

I particularly like the REITs Centuria Industrial REIT (ASX: CIP) and Dexus Industria REIT (ASX: DXI). They are experiencing strong rental growth thanks to demand areas such as e-commerce, the onshoring of logistics/supply chains, and data centres.

Rural Funds Group (ASX: RFF) is another favourite of mine because of the exposure to farmland, its contracted rental income, the long-term contracts with tenants, its ability to invest in farms to improve the productivity for tenants, and the reliability of its payouts.

Each of the above property options has distribution yields of more than 5%, which I’d describe as very compelling, in my opinion.

I also really like Charter Hall Long WALE REIT (ASX: CLW) because it has a diversified portfolio across a number of subsectors – I think it’s an effective way to invest across the Australian commercial property world. It has clients signed on for the long-term and expects to pay an annual distribution yield of 6.8%.

But REITs are just one area of the ASX of course, there are plenty of other ASX shares that could deliver even stronger returns.

The post After the Federal Budget, this is the type of property investment I’d buy in 2026 appeared first on The Motley Fool Australia.

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Motley Fool contributor Tristan Harrison has positions in Rural Funds Group. 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 positions in and has recommended Rural Funds Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Building long-term wealth does not need to be hard.

One easy way to do it is with ASX exchange traded funds (ETFs), which can give investors exposure to global companies, major markets, and powerful investment themes in a single trade.

Here are three ASX ETFs that could be worth a closer look.

Betashares Asia Technology Tigers ETF (ASX: ASIA)

The first ASX ETF to consider is the Betashares Asia Technology Tigers ETF.

This fund gives investors exposure to leading technology and online retail companies across Asia, but excluding Japan.

That makes it quite different from many global technology funds, which are often dominated by US names. The Betashares Asia Technology Tigers ETF can provide exposure to Asian semiconductor companies, ecommerce platforms, digital payment businesses, and online services.

Asia remains home to some of the world’s largest populations, fastest-growing digital economies, and most important technology supply chains. As more consumers and businesses in the region move online, the companies supporting that shift could have a long runway for growth.

It was recently recommended by analysts at Betashares.

iShares S&P 500 AUD ETF (ASX: IVV)

Another ASX ETF that could help build wealth over time is the iShares S&P 500 AUD ETF.

This fund gives Australian investors access to the S&P 500, which is home to many of the largest listed companies in the United States.

The fund includes businesses across technology, healthcare, financials, consumer goods, industrials, and communication services.

Its strength is arguably its simplicity. Instead of trying to figure out which US giant will outperform, investors can gain broad exposure to a large group of market leaders.

The United States remains home to many of the world’s most profitable and innovative companies, making this fund a great long-term option for investors wanting global diversification and exposure to American business strength.

Betashares Global Cybersecurity ETF (ASX: HACK)

A third ASX ETF to look at for the long-term is the Betashares Global Cybersecurity ETF.

Cybersecurity has become a basic requirement of the modern economy. Companies, governments, hospitals, banks, schools, and households all need protection as more activity moves online.

This fund gives investors targeted exposure to global cybersecurity businesses. These companies operate in areas such as network security, cloud protection, identity management, threat detection, and data defence.

The long-term case is easy to understand. Cyber threats are unlikely to disappear. If anything, artificial intelligence, cloud computing, remote work, and digital payments could make security even more important.

The Betashares Global Cybersecurity ETF is still a thematic fund, so it can be volatile. But for investors looking beyond the next year or two, cybersecurity could remain one of the more durable technology trends.

The post 3 ASX ETFs that could help build long-term wealth appeared first on The Motley Fool Australia.

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Motley Fool contributor James Mickleboro has positions in Betashares Capital – Asia Technology Tigers Etf. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended BetaShares Global Cybersecurity ETF and iShares S&P 500 ETF. The Motley Fool Australia has recommended iShares S&P 500 ETF. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Australia’s property market has shifted.

After years of relentless price growth, the combination of three RBA rate hikes, the federal budget’s negative gearing changes, and stretched affordability is doing what many thought impossible: pushing house prices lower in Australia’s two largest cities.

Commonwealth Bank of Australia’s (ASX: CBA) own economists estimate the budget changes to negative gearing and capital gains tax will make established investment properties less attractive. As a result, house prices are expected to be about 3% lower than they otherwise would have been.

Dwelling price growth is now expected to be just 3% to December 2026, down from an earlier forecast of 5%.

Investors are naturally asking themselves what this means for these three widely held ASX shares.

What falling house prices mean for CBA shares

CBA sits at the centre of the Australian housing market.

It is Australia’s largest mortgage lender, and falling house prices create two distinct risks for shareholders.

First, lower property values reduce the collateral backing existing mortgages, increasing loan-to-value ratios.

Second, three cash rate hikes have subtracted 1.5 percentage points from the banks’ 2026 price growth forecasts. The restriction of negative gearing will also weigh on prices, with CBA estimating this policy change will subtract 0.6 percentage points from annual price growth by the end of this year.

That slowdown will reduce the appetite for new borrowing, which directly impacts CBA’s mortgage volume growth.

In the first half of FY2026, CBA posted statutory net profit of $5.41 billion, confirming the underlying business remains strong.

But at a premium valuation, there is little room for a meaningful deterioration in credit quality.

What falling house prices mean for REA Group Ltd (ASX: REA)

REA Group is Australia’s dominant online property platform, operating realestate.com.au.

Its revenue model depends on property listing volumes and the fees charged to agents and developers.

Falling house prices create a complex picture for REA. A slowing market with more days on market can actually increase listing volumes as vendors spend longer trying to sell.

However, a sustained price decline can dampen vendor confidence, reducing the number of people willing to list at all.

REA Group’s first-half FY2026 result delivered revenue growth of 21% to $912 million, driven by strong listings and yield improvements. That momentum reflects a market that was still functioning actively in the first half.

The second half will test whether REA’s yield-per-listing growth can compensate if vendor confidence softens.

Bell Potter recently downgraded REA Group to sell with a $137 price target, noting the valuation looks stretched relative to a property market losing momentum.

What falling house prices mean for Mirvac Group (ASX: MGR)

For Mirvac, falling house prices present a more nuanced picture.

Mirvac develops new residential properties, not existing ones.

The federal budget’s negative gearing changes actually benefit Mirvac by exempting new builds from restrictions applying to established properties. This has created a direct policy incentive for investors to buy new rather than existing properties.

In Q3 FY2026, Mirvac delivered a 28% year-on-year lift in residential sales, reaffirming its full-year guidance and confirming the new-build demand tailwind is real.

Mirvac shares have still fallen approximately 26% over the past twelve months as the rate hiking cycle weighed on REIT valuations.

Macquarie carries an outperform rating on Mirvac with a price target of $2.70, arguing the residential recovery and build-to-rent growth story may drive earnings higher even in a higher-for-longer rate environment.

Foolish takeaway

Falling house prices are not a disaster for all ASX shares with property exposure.

CBA faces credit quality headwinds if the slowdown deepens.

REA Group must navigate lower vendor confidence against strong yield-per-listing growth.

Mirvac, counterintuitively, may be one of the few property-exposed ASX shares that actually benefits from the policy environment driving the slowdown.

Understanding which side of the falling house prices story each company sits on is the most important question for investors right now.

The post What falling house prices could mean for these widely held ASX shares appeared first on The Motley Fool Australia.

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• Why the RBA’s decision next week could be the most important event for ASX shares in 2026

Motley Fool contributor Mark Verhoeven 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.

Are you hunting for some ASX dividend shares to add to your income portfolio next week?

If you are, then take a look at the two listed below that brokers rate as buys.

Here’s what they are expecting from them in the near term:

Harvey Norman Holdings Ltd (ASX: HVN)

Bell Potter thinks retail giant Harvey Norman could be an ASX dividend share to buy.

It likes the company due partly to its attractive valuation, international expansion, and real estate portfolio. It explains:

While our preference skews to category specialists with balance sheet strength, we see HVN’s well balanced geographical diversification somewhat offsetting the multi-category risks. Following the sharp sell-off in the name since Oct-25, HVN’s 1-year forward P/E of ~13x (as per BPe) appears attractive considering the new store driven growth in international retailing (UK, Malaysia, Croatia), refit program in Australia and opportunities to grow their real estate portfolio as Australia’s single largest owner in large format retail with a global portfolio of ~$4.6b.

Bell Potter expects fully franked dividends of 29.8 cents per share in FY 2026 and 33.5 cents per share in FY 2027. Based on its current share price of $4.79, this equates to dividend yields of 6.2% and 7%, respectively.

The broker has a buy rating and $6.70 price target on its shares.

Nick Scali Limited (ASX: NCK)

Another ASX dividend share that brokers are bullish on is furniture retailer Nick Scali.

The broker is bullish due to its attractive valuation and positive growth outlook. The latter is being driven partly by its UK store rollout. It said:

We use an FY28 PER and DCF when setting our price target as we opt to look through near-term consumer weakness, with the current price providing an attractive entry point. High-quality retailer with a long track record. Nick Scali has delivered long-term EPS growth through disciplined store rollout, LFL growth, best-in-class margins, and operating leverage.

Strong cash generation and balance sheet. Structural negative working capital supports high cash conversion, while the low capital intensity of new store rollouts leaves ample cash flow for dividends and property purchases and/or growth ventures. Store rollout optionality. Further Plush and Nick Scali rollout in ANZ and the Nick Scali rollout opportunity in the UK provide an attractive growth leg.

Morgans is forecasting fully franked dividends of 71 cents per share in both FY 2026 and FY 2027. Based on its current share price of $15.46, this would mean dividend yields of 4.6%.

The broker put a buy rating and $17.84 price target on its shares last week.

The post Brokers name 2 ASX dividend shares to buy appeared first on The Motley Fool Australia.

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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 positions in and has recommended Harvey Norman. The Motley Fool Australia has recommended Nick Scali. 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 only just inside the green for 2026, up 0.8%, but some shares are on a different course.

Here are six stocks that have strong 12-month growth ahead of them, according to market analysts.

CSL Ltd (ASX: CSL)

The CSL share price closed at $107.51 on Friday, up 0.3%.

The ASX 200 healthcare share jumped 9.8% last week while its peers in the S&P/ASX 200 Health Care Index (ASX: XHJ) rose 3.3%.

The CSL share price has cratered over the past two years, but many experts maintain a positive view on the former blue-chip.

There is a consensus moderate buy rating on CSL shares among 18 analysts on the Commsec trading platform today.

UBS renewed its buy rating on CSL shares with a 12-month price target of $158 last week.

This suggests potential capital gains of 47% ahead.

Waratah Minerals Ltd (ASX: WTM)

The Waratah Minerals share price closed out the week at 61 cents, down 1.6% on Friday.

Bell Potter reiterated its speculative buy rating after Waratah Minerals released new assay results last week.

The explorer is conducting an 80,000-metre drill program at its Spur Gold and Copper Project in NSW.

Bell Potter said:

The Spur project is showing strong indications of delivering a gold-copper deposit of substantial scale and grade in a strategic setting.

We see potential for the delineation of a regionally significant gold Resource of 2.5-3.0Moz at competitive gold grades between 0.8-1.0g/t Au.

The broker has an unchanged price target of $1.05, which indicates a potential 73% upside ahead.

Deep Yellow Ltd (ASX: DYL)

The Deep Yellow share price finished Friday’s session at $1.42, up 4%.

Jefferies upgraded this ASX uranium share to a buy rating last week.

The broker has a target of $1.90, which implies 34% upside from here.

Graincorp Ltd (ASX: GNC)

The Graincorp share price closed at $5.18 on Friday, up 1.2%.

Ord Minnett has a buy rating and a $7.25 target on the ASX 200 consumer staples share.

This suggests potential capital growth of 40% ahead.

The broker said:

The FY27 crop is likely to be smaller than FY26, but it is now unlikely to be the disaster it was shaping up to be. In Ord Minnett’s view, this makes the 21% retracement in the GrainCorp share price since 14 May seem like a significant overreaction. 

South32 Ltd (ASX: S32)

The South32 share price closed out the week at $4.52, up 3.4% on Friday.

Citi has reaffirmed its buy rating on this ASX 200 mining share.

Analyst Ephrem Ravi has a price target of $6.10.

This implies a potential 35% upside ahead.

Judo Capital Holdings Ltd (ASX: JDO)

The Judo share price finished Friday’s session at $1.44, up 1.4%.

Morgans renewed its buy call on the ASX bank share with a $2.15 price target.

This implies a potential 50% upside over the next 12 months.

The post 6 ASX shares with 35% to 75% growth ahead of them: experts appeared first on The Motley Fool Australia.

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Citigroup is an advertising partner of Motley Fool Money. Motley Fool contributor Bronwyn Allen 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 CSL and Jefferies Financial Group. The Motley Fool Australia has recommended CSL. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

On Friday, the S&P/ASX 200 Index (ASX: XJO) finished the week in style. The benchmark index rose 2% to 8,804 points.

Will the market be able to build on this on Monday? Here are five things to watch:

ASX 200 expected to rise

The Australian share market looks set for a decent start to the week following a solid finish to the last one on Wall Street. According to the latest SPI futures, the ASX 200 is expected to open the day 39 points or 0.45% higher. In the United States, the Dow Jones was up 0.7%, the S&P 500 rose 0.5%, and the Nasdaq climbed 0.3%.

Oil prices tumble

ASX 200 energy shares including Santos Ltd (ASX: STO) and Woodside Energy Group Ltd (ASX: WDS) will be on watch after oil prices tumbled on Friday night. According to Bloomberg, the WTI crude oil price was down 3.2% to US$84.88 a barrel and the Brent crude oil price was down 3.4% to US$87.33 a barrel. Reports that the US and Iran are on the verge of signing a peace deal could put further pressure on oil prices in Asian trade.

SpaceX takes off

Space Exploration Technologies Corp (NASDAQ: SPCX) had a very successful IPO on Friday. The space, satellite broadband, and AI company’s shares jumped 19% to end at US$160.95. This leaves Elon Musk’s SpaceX with a US$2.1 trillion valuation and makes him the world’s first trillionaire.

Gold price jumps

ASX 200 gold shares including giants Newmont Corporation (ASX: NEM) and Northern Star Resources Ltd (ASX: NST) could have a great start to the week after the gold price jumped on Friday night. According to CNBC, the gold futures price was up 3% to US$4,238.8 an ounce. Falling oil prices have eased inflation concerns and interest rate hike bets.

Buy SEEK shares

Bell Potter thinks Seek Ltd (ASX: SEK) shares are still good value despite cutting its valuation this morning. According to the note, the broker has retained its buy rating with a reduced price target of $18.60 (from $23.60). It said: “We maintain our Buy; SEK is our preferred rate-sensitive classifieds exposure looking through to a dovish RBA tilt, given the diversification in CAR and policy-impacted earnings outlook for REA. Our Target Price is reduced to $18.60sh through earnings changes and an increase in our WACC to 10.3% (prev. 10.2%), a reduction our Growth Fund valuation via Coursera and an increase in Fund discount rate to 30% (prev. 20%) on visibility in PortCo operating performance in an AI-enabled environment. SEK’s underlying proprietary data (~750m points per day) partially consists of traffic meta data which is unable to be scraped by third parties, is valuable for targeted job placements, should support yield through soft volume environments.”

The post 5 things to watch on the ASX 200 on Monday appeared first on The Motley Fool Australia.

More reading

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Motley Fool contributor James Mickleboro has positions in Woodside Energy Group Ltd. 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.

Tomorrow the Reserve Bank of Australia will make its call on the cash rate, which currently sits at 4.35%. 

The RBA has raised the cash rate three times already in 2026. 

Why is the cash rate influential for ASX shares?

For the average punter, the cash rate target affects how much Australians pay to borrow money and how much they earn on savings. 

When the cash rate goes up, mortgage repayments and loan costs usually increase, while savings accounts often pay more interest.

When the cash rate goes down, borrowing becomes cheaper, which can boost spending and help support the economy.

The RBA cash rate can also significantly influence share prices on the S&P/ASX 200 Index (ASX: XJO) and the broader Australian share market.

When rates rise, borrowing becomes more expensive for companies and consumers, which can reduce profits and spending. This often puts downward pressure on share prices, especially for growth companies.

When rates fall, businesses and households can borrow more cheaply, which may boost profits and economic activity. Investors may also move money from low-yield savings accounts into shares, supporting stock prices.

While it’s not always the case, generally, higher rates tend to be a headwind for shares, while lower rates are generally supportive of the share market.

What are the big four banks expecting tomorrow?

Experts and economists are expecting tomorrow’s RBA meeting to result in a hold of the cash rate. 

This is supported by the big four banks, who also expect a rate hold this month. 

Taylor Nugent, senior economist at NAB, said (via Reuters) that the chance ​of a move at the June meeting is very low. 

He commented:

The RBA has now recalibrated policy and we’re seeing evidence it was enough to get on top of domestically driven inflation pressures. That means the RBA can ​sit and hold from here while it assesses risks to inflation and growth coming out of the conflict in ​the Middle East.

According to Canstar, there are differing opinions on the long-term outlook from the big four banks. 

Westpac believes there will be further hikes to come in the back half of 2026, while the other major banks expect the next change to be cuts in 2027. 

What does a hold mean for ASX bank shares?

It has been a tough year so far for ASX bank shares. 

At the time of writing, year to date: 

• Commonwealth Bank Of Australia (ASX: CBA) shares are down 1%
• National Australia Bank (ASX: NAB) is down nearly 14%
• Westpac Banking Corporation (ASX: WBC) is down 10%
• ANZ Group (ASX: ANZ) shares have fallen 6%. 

At current valuations, bank shares are viewed as already trading at a premium.

However, a hold decision (on the cash rate) could provide some optimism that the worst is over. 

The RBA’s commentary around this decision is likely more important than the decision itself. 

A hold with a dovish outlook (hinting at future cuts) will likely support the broader market. 

However a hold with a hawkish outlook (tipping further hikes) could put more downward pressure on bank shares. 

The post What are the big four banks expecting at tomorrow’s RBA cash rate meeting? appeared first on The Motley Fool Australia.

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Motley Fool contributor Aaron Bell has positions in National Australia Bank. 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.

The ASX dividend stock GQG Partners Inc (ASX: GQG) has seen its share price sink approximately 50% since July 2024, as shown in the chart below. This low valuation makes me think it’s a great time to invest.

GQG is a fund manager that provides clients with exposure to four key strategies: international shares (excluding US shares), emerging markets, global shares, and US shares.

Funds management businesses can be very volatile because their profits (and, subsequently, share prices) are closely linked to movements in the overall share market, which in turn influences funds under management (FUM).

Let’s take a look at why I think this could be a compelling time to look at the ASX dividend stock.

Excellent ASX dividend stock credentials

I’m not expecting the business to grow its dividend every year, particularly this year. But, pleasingly, it did increase its dividend each year between 2022 and 2025. Ongoing growth of FUM will be essential for noticeable dividend growth in the future.

Even so, its current quarterly dividend is so large that I think this makes it very attractive.

The ASX dividend stock’s latest quarterly dividend, which will be paid later this month, is AU 4.878 cents per share. That quarterly dividend by itself is a 3.27% dividend yield, at the time of writing. Annualised, that dividend yield is 13% if it repeats that payout over the next year.

The business is paying around 90% of its distributable profit to shareholders each quarter. That means investors are being rewarded with most of the profit, but a little is still kept to strengthen the company for the future.

Any business with a double-digit yield could be very compelling for passive income.

Why this is a good time to invest in GQG shares

I think that funds management businesses are notoriously cyclical, so it could be an effective choice to be contrarian.

GQG has seen FUM outflows in recent times, but these appear to be reducing, and if its fund performance returns to prior strength, this could protect existing FUM and help attract new FUM.

The ASX dividend stock now seems to be trading at a very cheap valuation. At the time of writing, it appears to be trading at less than 7x its current annualised distributable profit.

Even if there are ongoing FUM outflows, longer-term investment performance could help grow FUM, profit, and the dividend. If FUM outflows stabilise, then it could look significantly undervalued, in my opinion.

But, GQG isn’t the only ASX dividend stock that looks attractive to buy right now.

The post 1 ASX dividend stock down 50% I’d buy right now appeared first on The Motley Fool Australia.

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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 no position in any of the stocks mentioned. The Motley Fool Australia has recommended Gqg Partners. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.