Author: therawinformant

The Mach7 Technologies Ltd (ASX: M7T) share price has stormed higher this morning following the release of an announcement.

In early trade the enterprise imaging platform provider’s shares are up 9% to $1.11.

What did Mach7 announce?

This morning Mach7 announced that it has signed a seven-year contract with Trinity Health for the license and associated support services for its eUnity enterprise viewer. The total value of this contract is A$5.26 million.

Trinity Health is the fifth largest healthcare Integrated Delivery Network (IDN) in the United States and this contract will see Mach7’s eUnity enterprise viewer being installed across multiple facilities within its 92 hospitals located across 22 US states.

It serves approximately 30 million people across these states, employs about 123,000 colleagues, including 6,800 employed physicians and clinicians, and has annual operating revenues of US$18.8 billion and assets of US$30.5 billion.

What now?

According to the release, the software deployment will occur in stages as software licenses are ordered by Trinity Health.

Mach7 expects to receive the first software license orders during the current quarter, and the majority of the orders within FY 2021.

Management advised that the associated software license revenue is likely to be recognised very shortly after the order is received, upon the license delivery and software deployment. Whereas support and maintenance fees will commence one year after deployment and will continue for a period of six years.

Mach7’s CEO, Mike Lampron, commented: “Mach7 is delighted to be partnering with Trinity Health, a respected and leading health care provider in the U.S.”

“This is Mach7’s first material contract award since our acquisition of Client Outlook and highlights our investment thesis around the importance of a world-class Enterprise Viewer to an Enterprise Imaging Strategy. This announcement represents a launching point for a larger and more integrated relationship with Trinity involving our vendor neutral archive and diagnostic viewing solutions,” he added.

More reading

• This under-the-radar ASX tech company’s shares are up 150% since March
• 3 growing small cap ASX shares
• Why Bendigo and Adelaide Bank, Mach7, National Storage, & Unibail-Rodamco-Westfield are dropping lower

James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and recommends MACH7 FPO. The Motley Fool Australia has recommended MACH7 FPO. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. 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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The Lovisa Holdings Ltd (ASX: LOV) share price has been rocketing higher on Friday morning after making an acquisition announcement.

At the time of writing the fast fashion jewellery retailer’s shares are up 15.5% to $11.59.

What did Lovisa announce?

This morning Lovisa announced the acquisition of the European retail store network of German wholesaler beeline GmbH.

This acquisition is expected to add more than 80 stores to the Lovisa global store network across six European countries.

According to the release, the beeline retail business currently operates 114 retail stores in seven countries selling fashion jewellery and accessories under the SIX and I AM brands.

Lovisa will acquire the shares of the six retail trading entities of the beeline group in Germany, Switzerland, The Netherlands, Belgium, Austria and Luxembourg, with all continuing stores to be rebranded to trade as Lovisa stores.

The shares in the six beeline entities will be acquired for a total purchase price of just 60 euros (that’s not a typo). Beeline will ensure a cash level of the entities of 9.87 million euros in aggregate, with no financial debt to be taken on as a result of this transaction.

In addition to this, Lovisa has also entered into a put option agreement in relation to the acquisition of beeline France and its store network of 30 stores.

This put option provides beeline with the option to sell the shares in beeline France to Lovisa following the completion of mandatory consultation with its employee works council in the country. The company intends to provide a further update upon successful completion of this process.

What now?

Management advised that the acquisition of each country is to be completed progressively from 1 March 2021 through to end May 2021.

The combined cash requirement for fit-out and inventory for the conversion of stores to Lovisa is expected to be less than 5 million euros.

As part of the transaction, upon completion, Lovisa will take over approximately 3 million euros of bank guarantees associated with the leases of the acquired beeline entities, as well as provide a further 3 million euros bank guarantee to the vendor to support its obligations under the share purchase agreement. These guarantees will be supported from existing credit facilities.

Lovisa’s Managing Director, Shane Fallscheer, commented: “We are very excited that this transaction gives us the opportunity to add six new countries to our global store network, and provides us with a strong base and quality team to grow the Lovisa brand further in these markets into the future as part of our ongoing global rollout strategy.”

Trading update.

Lovisa also provided investors with an update on its performance in FY 2021.

The company reminded the market that its 24 stores in France and 39 of its stores in the UK are currently temporarily closed as a result of government-imposed lockdowns.

However, the remainder of its store network has seen a continuation of the improved sales trend previously reported.

It notes that its comparable store sales for the first 19 weeks of FY 2021 are down 9.2% on the prior corresponding period. This is being driven by the continued stronger performance from those markets that have been re-opened longest and with the least restrictions in place. Australia and New Zealand continue to be its best performing regions.

More reading

• Best and worst ASX retail stocks to own in the COVID recovery
• Why IDP Education, Perseus Mining, Lovisa, & Tyro shares are dropping lower
• Why the Lovisa (ASX:LOV) share price is dropping lower today
• 4 ASX shares to buy for a rare Christmas surprise

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. 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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The Jumbo Interactive Ltd (ASX: JIN) share price will be on watch this morning after the company announced a signed agreement with Lotterywest.

What does Jumbo do?

Jumbo is Australia’s largest digital lottery retailer, operating through its flagship service, Oz Lotteries.

Jumbo runs both national and charity lotteries, as well as develops and supplies software platforms to other lottery companies. Its in-house digital platforms aim to create an engaging and entertaining experience for all customers.

What was signed?

According to the release, Jumbo subsidy TMS Global Services signed an agreement with the Western Australian state government-owned and operated, Lotterywest.

The deal will see Jumbo provide its online software platform and services to Lotterywest for up to the next 10 years. This follows on from the binding term sheet signed and announced to the market on 29 September.

Jumbo CEO, Mr Mike Veverka, commented on the milestone partnership:

I am pleased that the Lotterywest Agreement has now been signed on time and on terms as anticipated. This is a major achievement for Jumbo securing our first government client setting up a solid long-term partnership and providing strategic opportunities for Jumbo.

Terms of the deal

Under the agreement, Jumbo will receive a 9.5% service fee for every customer transaction through the white label platform. The service fee will cover Jumbo’s software operation, technical and customer support, and development services and costs.

The agreement is to be a three-year initial term, with the option for a further three and four years. The extension options are to be decided by Lotterywest.

Customer ownership will be transferred to Lotterywest at the moment the customer opts in to the white label platform.

Lotterywest will oversee the marketing strategy for players, and Jumbo will manage customer support. This will be conducted on the white label platform, and Jumbo will only be able to market to customers by approval from Lotterywest.

Lastly, Lotterywest has the option to transition white label players to its website and app for 12 months from the go-live date. Both parties expect to have completed software integration by late December.

Jumbo share price summary

The Jumbo share price has made a solid comeback of 83% since falling to as low as $6.99 in March. For the calendar year to date, the shares in the lottery retailers are down 14%, and down 41% from their 52-week high.

Jumbo has a market capitalisation of $800 million and a price-to-earnings (P/E) ratio of 31.1.

More reading

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• Jumbo (ASX:JIN) share price drops lower following Q1 update

Aaron Teboneras owns shares of Jumbo Interactive Limited. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. recommends Jumbo Interactive Limited. The Motley Fool Australia owns shares of and has recommended Jumbo Interactive Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. 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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Is the Magellan Infrastructure Fund (Currency Hedged) (ASX: MICH) share price a buy?

It’s an active exchange-traded fund (ETF) that invests in global infrastructure. It’s currently an ASX share rated as a buy by the Motley Fool Dividend Investor service.

What’s an active ETF?

Not every ETF is passive that just follows an index. Typical ETFs such as Vanguard Australian Shares Index ETF (ASX: VAS) just aim to follow the ASX 300.

But there are some fund managers that offer their funds in an open-ended fund structure that can be invested in via the ASX. The key difference is that fund managers are the ones that are making the share picks, rather than an automatic index weighting.

Which manager manages this ETF?

The Magellan Infrastructure Fund is managed by Magellan Financial Group Ltd (ASX: MFG), which has billionaire investor Hamish Douglass as the chair and chief investment officer.

Magellan is best known for being an investment manager that focuses on international shares, with $78.3 billion of funds invested with Magellan’s international strategy. However, Magellan has also $17.86 billion invested in infrastructure shares.

The actual Magellan Infrastructure Fund is managed by Gerald Stack.

What does Magellan Infrastructure Fund aim to do?

According to Magellan, it aims to hold 20 to 40 shares and tries to deliver the stable returns offered by the asset class, while protecting returns from currency movements.

Magellan says that the infrastructure asset class is characterised by monopoly-like assets that face reliable demand and enjoy predictable cashflows. Potential investments that meet these criteria are expected to achieve strong underlying financial performance over medium- to long-term timeframes, which should translate into reliable, inflation-linked investment returns.

Magellan has a particular process for identifying infrastructure. The underlying business must provide a service that is essential to the efficient functioning of a community, while generating cash flows that are not subject to external risks such as commodity prices. Magellan also evaluates other criteria, such as gearing levels, sovereign risk, regulatory risk and reporting transparency, which, if failed, will result in exclusion from the investment universe.

The fund manager believes that by excluding businesses that fail to meet these criteria, the universe consists purely of companies that enjoy reliable demand and generate predictable cash flows. This analysis includes evaluations of a company’s external environment, its business-specific issues, its historical financial performance and its valuation.

What shares are in the fund?

In its latest monthly update, Magellan Infrastructure Fund said that its largest 10 holdings, in alphabetical order, were: American Water Works, Atmos Energy Corporation, Crown Castle International, Enbridge, Eversource Energy, Red Electrica Corporation, Sempra Energy, Transurban Group (ASX: TCL), Vopak and Xcel Energy.

At 31 October 2020, it also had a cash position of 10% of the portfolio.

Whilst USA shares represents the biggest country allocation, it’s less than half of the portfolio at around 42%. Europe, Canada, Latin America, the UK and Asia Pacific are also represented.

How has it performed?

Magellan quotes its returns as net returns, which is after the fees – including the management fee of 1.05% per annum.

Over the past four years, the Magellan Infrastructure Fund has returned 5.5% per annum, outperforming the S&P Global Infrastructure Net Total Return Index by an average of 4.2% per annum.

Is the Magellan Infrastructure Fund share price a buy?

It’s currently trading at a slight premium to its intraday indicative net asset value (NAV) per unit of $2.9165.

The fund is still rated as a buy by the Dividend Investor service who said it’s “a good investment idea for those looking to benefit from exposure to listed, global infrastructure. It’s a simple and easy solution for those looking to diversify their investments, providing a nice hedge against some of the more volatile stocks elsewhere in the market.”

More reading

• One ASX infrastructure share to consider for dividend income today

Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Magellan Infrastructure Fund. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. 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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Exchange-traded funds (ETFs) continue to soar in popularity, attracting a record amount of money from Australian investors last month.

According to Betashares, October was the second consecutive month the Australian ETF industry broke the net inflow record. It added $2.3 billion under management after grabbing $2.1 billion in September.

Those two months mark the only period in history that the monthly figure has exceeded $2 billion.

The Australian ETF industry is now worth $73.8 billion, which is also another all-time record.

Two factors made ETFs attractive in October, according to Betashares head of strategy Ilan Israelstam.

“While global equities pulled back for the second successive month, the Australian market was up by 1.9% — prompting investors to increase their exposure to domestic equities,” he told The Motley Fool.

“Secondly, we saw some rotation into previously out-of-favour sectors, especially the banks, which of course make up a significant proportion of the local sharemarket. The financial sector was up around 6% over the month.”

Israelstam expects more records to be broken in the coming period.

“Over the last few months there has been an increase in investor confidence, as the market rally from the lows of March have been sustained,” he said.

“This has seen investors increase their exposures to equities – and Australian and international equities were the two ETF categories that saw the biggest inflows in October.”

It’s not all beer-and-skittles for the local industry though. Betashares itself and AMP Limited (ASX: AMP) are shutting down all three ETFs they jointly run, announcing last week that the last day of trade will be 4 December.

Who are the most popular ETF providers?

Among the ETF providers, Betashares and Vanguard are dominating. They’ve each attracted more than $4.3 billion of investment so far this year.

iShares is a very distant third with $2.3 billion of year-to-date inward flow.

At the other end of the league table, Platinum is not having a good year, losing $50 million out of its ETFs.

Top 5 ETF providers: most money in

ETF provider	Inflow year-to-date	% of Australian industry
Betashares	$4.35 billion	27.8%
Vanguard	$4.33 billion	27.6%
iShares	$2.32 billion	14.8%
VanEck	$1.66 billion	10.6%
ETF Securities	$1.13 billion	7.2%
Source: Betashares. Table created by author

Bottom 5 ETF providers: most money out

ETF provider	Inflow year-to-date	% of Australian industry
Platinum	($50.03 million)	(0.3%)
K2 Global	($5.32 million)	0.0%
Schroder	($1.76 million)	0.0%
Antipodes	($0.68 million)	0.0%
Kapstream	$3.3 million	0.0%
Source: Betashares. Table created by author

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Motley Fool contributor Tony Yoo has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. 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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The Ramsay Health Care Limited (ASX: RHC) share price will be on watch this morning following the release of an announcement.

What did Ramsay announce?

In response to the ongoing impact of the COVID-19 pandemic on its operations, this morning Ramsay provided an update on trading across the business during the first quarter of FY 2021.

Ramsay’s Managing Director and CEO Craig McNally, commented: “Ramsay’s operating results continued to be impacted by the COVID-19 pandemic in 1Q FY’21. Surgical restrictions, regional outbreaks and lower demand for some services, combined with higher costs associated with operating in the current environment, have all impacted the results.”

How are its businesses performing?

According to the release, Ramsay Australia reported a 1.5% increase in total revenue during the first quarter. This reflects a 1.7% increase in surgical admissions and lower non-surgical activity.

A major drag on its performance was its Victorian operations. Excluding Victoria, total Australian revenue was up 6.6% and surgical admissions rose 8% over the prior corresponding period.

These operations also weighed heavily on Ramsay Australia’s earnings before interest, taxes, depreciation, amortisation and restructuring or rent costs (EBITDAR), which was lower than the prior corresponding period.

Management notes that this was due to restricted surgical activity in Victoria, increased costs, and reduced procurement benefits as a result of operating in a COVID safe environment. Also weighing on its performance was a negative mix impact from the decrease in medical, mental health, and rehabilitation case volumes.

The Ramsay Santé business saw an increase in surgical activity in the first quarter. Management revealed that volumes increased 5.4% over the prior corresponding period in France as clinicians sought to reduce the backlog of surgeries created by the first COVID-19 lockdown.

The Nordic region also reported growth in surgical volumes in recent months. Though, demand for other services has been below the prior period due to the impact of COVID-19.

After a slow start to FY 2021, the company revealed that its Ramsay UK business has experienced a recovery in private work in recent months. This is being driven by private health insurers and clinicians moving to reduce the surgical wait lists, and a recovery in demand for other services such as oncology flowing from the public system.

Nevertheless, total Ramsay UK revenue for the first quarter was down 9.9% on the prior corresponding period in local currency.

Finally, over in Asia the company revealed that movement control orders have impacted patient volumes. One positive, though, is that its diagnostic pathology services in Indonesia and Malaysia have benefitted from an increase in COVID-19 PCR testing as a result of a second wave in both countries.

Outlook.

Mr McNally warned that the near term will be tough for Ramsay but he remains very positive on its long term outlook.

He said: “Given the near-term uncertainties in the market, we are not in a position to provide guidance for FY’21. Notwithstanding the current environment, over the medium to long term the health care industry fundamentals remain positive.”

“Ramsay is well positioned to capitalise on the shifting industry dynamics in each of our key markets. Following the recent equity raising, the Company has a strong balance sheet to support new opportunities as they arise,” concluded Mr McNally.

More reading

• Broker tipping a ~10% jump in the Medibank (ASX:MPL) share price by Tuesday
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• How to turn $20,000 into $350,000 in 10 years with ASX shares

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Ramsay Health Care Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. 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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Fortunately, in this low interest rate environment, the share market is home to plenty of shares offering generous yields.

For example, two ASX blue chip shares that have prospective yields of over 5% are listed below. Here’s what you need to know about them:

BHP Group Ltd (ASX: BHP)

BHP is one of the world’s largest and highest quality miners in the world. The Big Australian has a collection of world class, low cost assets across a diverse range of commodities which continue to generate significant free cash flows. This certainly is the case for its iron ore and copper operations, which are benefiting greatly from sky high prices.

One broker that is expecting bumper free cash flows from BHP in FY 2021 is Macquarie. And the good news for shareholders is that its analysts expect the majority of this to be returned to shareholders via dividends. Macquarie is forecasting a full year dividend of approximately $2.80 per share. Based on the current BHP share price, this would mean a massive fully franked 7.7% dividend yield.

Telstra Corporation Ltd (ASX: TLS)

This telco giant has been in the news this week after announcing plans to split its business into three separate entities. This will comprises InfraCo Fixed, InfraCo Towers, and ServeCo. Management believes the restructure would enable the company to take advantage of potential monetisation opportunities for its infrastructure assets, which could create additional value for shareholders.

This plan has gone down well with investors and also with brokers. For example, Goldman Sachs has reiterated its buy rating and $3.60 price target on the company’s shares. It has also reaffirmed its forecast for a 16 cents per share fully franked dividend in FY 2021 and beyond. Which, based on the current Telstra share price, would provide investors with a 5.2% dividend yield.

More reading

• The ASX 200 fell 0.5% on Thursday
• After 8 months, ASX 200 shares are finally out of correction territory
• Why InvoCare, Nine, Telstra, & Wesfarmers shares are storming higher
• ASX 200 down 0.1%: Xero hits record high, Telstra and Wesfarmers updates impress
• Telstra (ASX:TLS) share price on watch after major update

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Telstra Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. 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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The Nearmap Ltd (ASX: NEA) share price was out of form on Thursday and dropped notably lower.

The aerial imagery technology and location data company’s shares dropped over 3% to $2.40.

Why did the Nearmap share price drop lower?

Investors were selling the company’s shares yesterday after the release of an update on its guidance for FY 2021 at its annual general meeting.

Nearmap has provided guidance for annualised contract value (ACV) of between $120 million and $128 million this year. This represents an increase of 12.8% to 20% on FY 2020’s ACV of $106.4 million. Management advised that this forecast is based on constant currency and does not factor in any unforeseen circumstances.

The high end of its guidance range is just inside its medium to long term ACV growth target of 20% to 40% per annum.

How does this guidance compare to expectations?

According to a note out of Goldman Sachs, its analysts were forecasting FY 2021 ACV of $122.7 million, which represents annual growth of 15%.

The broker commented: “NEA has provided ACV guidance for FY21, between A$120mn to A$128mn which implies +13% to +20% YoY growth on a constant currency basis. Our published FY21E ACV forecast of A$122.7mn (+15% YoY) is within this range (and on constant currency basis our forecast would be A$126.7mn).”

“While this growth rate remains below the company’s medium-to-long term target of +20-40% YoY ACV growth, the company reiterated it expects accelerated ACV growth from FY22,” it added.

Is the Nearmap share price in the buy zone?

Goldman Sachs has retained its neutral rating following this update. Though, it is worth noting that the broker’s price target is materially higher than where the Nearmap share price is currently trading.

Its analysts have a $2.95 price target on the company’s shares, which implies potential upside of almost 23% for its shares over the next 12 months.

More reading

• Why Fortescue, Nearmap, Saracen, & Westpac shares are dropping lower
• The Nearmap (ASX:NEA) share price is up and down today. Here’s why.
• 5 things to watch on the ASX 200 on Thursday
• Where you could invest $20,000 into ASX shares today
• ASX 200 jumps 1.75% on Monday

James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of Nearmap Ltd. The Motley Fool Australia has recommended Nearmap Ltd. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. 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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The Wesfarmers Ltd (ASX: WES) share price was a strong performer on Thursday.

The conglomerate’s shares climbed a solid 2.5% to $48.78.

This leaves the Wesfarmers share price trading within a whisker of its record high.

Why did the Wesfarmers share price climb higher?

Investors were buying Wesfarmers shares yesterday following the release of a trading update ahead of its virtual annual general meeting.

That update revealed that the majority of the company’s businesses have delivered strong sales growth so far in FY 2021.

The company’s biggest business – Bunnings – has been a key highlight during the first four months of the new financial year.

The Bunnings business has delivered a 25.2% increase in sales over the prior corresponding period. Management notes that this strong sales growth has driven by both the consumer and commercial segments. Consumer sales remained particularly strong as customers spent more time undertaking projects around the home.

This growth was supported by its Officeworks and Catch businesses. They delivered sales growth of 23.4% and 114.4%, respectively, over the prior corresponding period.

Things were not quite as positive for its Kmart and Target businesses, which have been impacted by government-mandated store closures during the pandemic.

Kmart delivered 3.7% sales growth, whereas Target recorded a 2.2% decline in sales. However, excluding its Melbourne stores, Kmart and Target delivered sales growth of 12.1% and 7.8%, respectively.

Is the Wesfarmers share price in the buy zone?

Unfortunately, it may too late to invest in this one, according to analysts at Goldman Sachs.

In response to this trading update, this morning the broker has held firm with its neutral rating and put a $47.90 price target on the conglomerate’s shares.

While Goldman Sachs expects a strong finish to 2020, it has warned that 2021 uncertainty is increasing.

It explained: “WES continues to be driven by Bunnings given the combination of the scale of the business’ contribution to group EBIT (66% of FY21E EBIT) and the strong sales momentum as the business benefits from the current “stay at home” consumption trends.”

“Looking ahead, the potential for a wet summer and the increasingly positive outlook for a gradual return to normal consumption activities (through better COVID management in Australia and global developments in vaccines) suggests risks to the short term earnings outlook are increasing despite our upgrades to FY21,” it added.

More reading

• 5 things to watch on the ASX 200 on Friday
• The ASX 200 fell 0.5% on Thursday
• Why InvoCare, Nine, Telstra, & Wesfarmers shares are storming higher
• ASX 200 down 0.1%: Xero hits record high, Telstra and Wesfarmers updates impress
• Best and worst ASX retail stocks to own in the COVID recovery

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of Wesfarmers Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. 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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On Thursday the S&P/ASX 200 Index (ASX: XJO) ran out of steam and ended its impressive winning streak. The benchmark index gave back its morning gains and fell 0.5% to 6,418.2 points.

Will the market be able to bounce back from this on Friday? Here are five things to watch:

ASX 200 looks set to fall again.

It looks set to be a tough end to the week for the ASX 200 after global markets dropped lower. According to the latest SPI futures, the ASX 200 is expected to open the day 26 points or 0.40% lower. In late trade on Wall Street the Dow Jones is down 1.3%, the S&P 500 has fallen 1.2%, and the Nasdaq is down 0.6%. There are concerns that rising COVID-19 cases could weigh on the global economy.

Oil prices higher.

Energy producers including Santos Limited (ASX: STO) and Woodside Petroleum Limited (ASX: WPL) could finish the week on a high after oil prices pushed higher. According to Bloomberg, the WTI crude oil price is up 0.2% to US$41.54 a barrel and the Brent crude oil price has risen 0.2% to US$43.88 a barrel.

Gold price rebounds.

It could be a better day of trade for gold miners such as Evolution Mining Ltd (ASX: EVN) and Newcrest Mining Limited (ASX: NCM) on Friday. According to CNBC, the spot gold price has rebounded 0.75% to US$1,875.70 an ounce. Rising COVID cases gave the precious metal a boost.

NEXTDC annual general meeting.

The NEXTDC Ltd (ASX: NXT) share price could be on the move today when it holds its virtual annual general meeting. At the event the data centre operator is likely to provide the market with an update on its performance year to date. Also holding its annual general meeting this morning is medical device company PolyNovo Ltd (ASX: PNV).

Wesfarmers given neutral rating.

The Wesfarmers Ltd (ASX: WES) share price could be fully valued now according to analysts at Goldman Sachs. In response to its trading update, the broker has held firm with its neutral rating and put a $47.90 price target on the conglomerate’s shares. Goldman expects a strong finish to 2020 but warned that 2021 uncertainty is increasing. The Wesfarmers share price is currently trading at $48.78.

More reading

• The ASX 200 fell 0.5% on Thursday
• After 8 months, ASX 200 shares are finally out of correction territory
• Broker tipping a ~10% jump in the Medibank (ASX:MPL) share price by Tuesday
• Why the Dubber Corp (ASX:DUB) share price is surging today
• Why are ASX tech shares all over the place today?

James Mickleboro owns shares of NEXTDC Limited. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of POLYNOVO FPO. The Motley Fool Australia owns shares of Wesfarmers Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. 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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