Category: Stock Market

The Global X Fang+ ETF (ASX: FANG) has been a very strong-performing exchange-traded fund (ETF), but I think it still has a lot of return potential from here.

The FANG ETF owns a portfolio of 10 of the largest and most compelling technology and tech-related businesses in the US.

Those ten names are: Tesla, Snowflake, Amazon.com, Apple, Alphabet, Meta Platforms, Microsoft, Netflix, Broadcom and Nvidia.

Collectively, those companies have done very well, and it’s showing for the fund’s returns.

FANG ETF performance

The performance of an ETF is dictated by the returns of the underlying holdings.

This ETF was created in February 2020 and has done well since then. Since its inception, the FANG ETF has returned an average of 32.6% per annum. Over the past three years, it has returned an average of 21.4% per annum. In the last 12 months, it has returned 42%.

Those are very strong returns. But first, we should be very clear that past performance is not a guarantee of future performance or even a reliable indicator of future returns.

When share prices rise rapidly, it could mean that the subsequent shorter-term returns aren’t quite as good because the returns may have been front-loaded.

The annual management fee of the FANG ETF is just 0.35%, so the costs aren’t too much of a detractor.

Why I think good returns can continue

These stocks have been significant drivers of the US share market and the global share market.

Many of them are at the forefront of new products and services, with excellent tailwinds that seem nowhere near finished blowing.

The global digitalisation of business operations is very helpful for the cloud computing operators of Microsoft (Azure), Alphabet (Google Cloud) and Amazon (AWS).  

The growth of online video has been huge for Netflix, and it also benefits Alphabet (YouTube) and some of the other FANG ETF holdings to a lesser extent.

AI has already been a huge growth area for Nvidia, Microsoft, and Alphabet. I think it could be an important earnings driver over the next few years.

Automated cars could be one of the next major growth runways that these businesses unlock. Alphabet’s Waymo is already providing driverless taxi rides, while Tesla is still working on it.

Augmented reality and virtual reality could be another earnings driver for some of these stocks, including Meta Platforms and Apple.

Foolish takeaway

The FANG ETF owns many of the stocks benefiting from global technological changes. While valuations can sometimes get ahead of themselves, these stocks are delivering more and more profit as the years go by, justifying higher share prices.

This fund certainly doesn’t look cheap, but I wouldn’t be surprised if it beats the S&P/ASX 200 Index (ASX: XJO) over the next five years because of the collective earnings growth potential of those US shares.

The post Why I’d still call the FANG+ ETF a buy appeared first on The Motley Fool Australia.

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Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to Meta Platforms CEO Mark Zuckerberg, is a member of The Motley Fool’s board of directors. John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. 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 Alphabet, Amazon, Apple, Meta Platforms, Microsoft, Netflix, Nvidia, Snowflake, and Tesla. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended Broadcom and has recommended the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool Australia has recommended Alphabet, Amazon, Apple, Meta Platforms, Microsoft, Netflix, and Nvidia. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

On Monday, the S&P/ASX 200 Index (ASX: XJO) continued its charge and reached a new record close. The benchmark index rose 0.75% to 8,017.6 points.

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

ASX 200 expected to fall

The Australian share market is expected to fall on Tuesday despite a decent start to the week on Wall Street. According to the latest SPI futures, the ASX 200 is poised to open the day 16 points or 0.2% lower. On Wall Street, the Dow Jones rose 0.5%, the S&P 500 climbed 0.3%, and the Nasdaq pushed 0.4% higher. All three indices closed at record highs.

Rio Tinto update

Rio Tinto Ltd (ASX: RIO) shares will be on watch on Tuesday when the mining giant releases its second quarter update. Goldman Sachs expects the company to fall short of consensus estimates with its iron ore shipments. It said: “[W]e expect RIO’s 2Q Pilbara iron ore shipments of 79Mt vs Consensus 82Mt as a result of train derailment early in the Q.” However, it thinks Rio Tinto will maintain its full year guidance. It adds: “We think RIO can make up the lost shipments in 2H and we model 330Mt (vs. 332Mt in 2023), in the middle of the 323-338Mt guidance range.”

Oil prices soften

It could be a subdued session for ASX 200 energy shares such as Santos Ltd (ASX: STO) and Karoon Energy Ltd (ASX: KAR) after oil prices softened overnight. According to Bloomberg, the WTI crude oil price is down 0.4% to US$81.88 a barrel and the Brent crude oil price is down 0.25% to US$84.81 a barrel. A stronger US dollar weighed on oil prices.

Nanosonics rated as a hold

The Nanosonics Ltd (ASX: NAN) share price is almost fully valued according to analysts at Bell Potter. In response to the infection prevention company’s second half trading update, the broker has retained its hold rating with an improved price target of $3.45. This implies potential upside of 4.2% from current levels. It said: “Pleasing to see volumes rebounding after a difficult period in 1H24 where the market for capital sales in the US hospital system was very tight. We maintain our Hold rating.”

Gold price rises

ASX 200 gold miners Gold Road Resources Ltd (ASX: GOR) and Regis Resources Limited (ASX: RRL) could have a good session on Tuesday after the gold price rose overnight. According to CNBC, the spot gold price is up 0.25% to US$2,426.6 an ounce. Traders were buying gold after the US Federal Reserve indicated that rate cuts could be coming very soon.

The post 5 things to watch on the ASX 200 on Tuesday 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 positions in and has recommended Nanosonics. The Motley Fool Australia has positions in and has recommended Nanosonics. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Income investors are spoilt for choice when it comes to ASX dividend shares. So much so, it can be hard to decide which ones to buy above others.

But don’t worry, because analysts have been busy doing the hard work for you and have picked out the ones they think are buys.

Two that have been named as buys are listed below. Here’s why they are bullish on them:

SRG Global Ltd (ASX: SRG)

Analysts at Bell Potter think that SRG Global could be a great ASX dividend share to buy.

It is a diversified industrial services group that provides multidisciplinary construction, maintenance, production drilling and geotechnical services.

Bell Potter is positive on the company due to its belief that it will be a beneficiary of accelerating growth in iron ore and gold production volumes over the next five years. It explains:

SRG’s short-to-medium term outlook is reinforced by Government-stimulated construction activity in the Infrastructure and Non-Residential sectors and increased development and sustaining capital expenditures in the Resources industry. The resulting expansion in infrastructure bases across these sectors will likely support increased demand for asset care and maintenance in the medium to long-term. We anticipate Mining Services will be a beneficiary of accelerating growth in iron ore and gold production volumes over the next five years.

In respect to dividends, the broker is forecasting fully franked dividends of 4.7 cents in FY 2024 and then 6.7 cents in FY 2025. Based on its current share price of 88.5 cents, this will mean dividend yields of 5.3% and 7.6%, respectively.

Bell Potter has a buy rating and $1.30 price target on its shares.

Telstra Group Ltd (ASX: TLS)

Analysts at Goldman Sachs think that Telstra could be an ASX dividend share to buy.

It rates the telco giant highly due to the strength of its mobile business. This was reinforced this month when Telstra announced price increases for its mobile plans. It expects this to underpin solid earnings and dividend growth in the coming years. In addition, the broker sees scope to unlock value from asset sales. It said:

We believe the low risk earnings (and dividend) growth that Telstra is delivering across FY22-25, underpinned through its mobile business, is attractive. We also believe that Telstra has a meaningful medium term opportunity to crystallise value through commencing the process to monetize its InfraCo Fixed assets – which we estimate could be worth between A$22-33bn. Although there is some debate around the strategic benefits, we see a strong rationale for monetizing the recurring NBN payment stream, given its inflation-linked, long duration cash flows could be worth $14.5bn to $17.9bn, with no loss of strategic benefit.

As for income, Goldman is forecasting fully franked dividends of 18 cents per share in FY 2024 and then 19 cents per share in FY 2025. Based on the current Telstra share price of $3.84, this equates to yields of 4.7% and 5%, respectively.

Goldman has a buy rating and $4.30 price target on its shares.

The post Why analysts rate these ASX dividend shares as buys appeared first on The Motley Fool Australia.

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• Top brokers name 3 ASX shares to buy next week
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• Telstra stock pays a massive 7% dividend, and now could be a great time to buy
• Here are the top 10 ASX 200 shares today

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 positions in and has recommended Goldman Sachs Group. The Motley Fool Australia has positions in and has recommended Telstra Group. The Motley Fool Australia has recommended Srg Global. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

If you want to make some buy and hold investments but aren’t sure which ASX shares to buy, then you could consider exchange traded funds (ETFs) instead.

That’s because they allow you to buy groups of shares with a single click of the button.

Not only does this make it easier for investors that don’t have time to research individual companies, but you can build a diversified portfolio with minimal effort.

But which ASX ETFs could be quality buy and hold options? Let’s take a look at four:

BetaShares Global Cybersecurity ETF (ASX: HACK)

The BetaShares Global Cybersecurity ETF could be a great long term option for investors.

In recent years there have been a number of high-profile cyber incidents. And you can safely say that they won’t be the last. As a result, it is no wonder that worldwide spending on cybersecurity is predicted to increase materially in the future.

This leaves the companies included in this fund, which are the leaders in the industry and working to reduce the impact of cybercrime globally, well-positioned for growth over the next decade and beyond.

BetaShares NASDAQ 100 ETF (ASX: NDQ)

And ASX ETF for investors to consider as a buy and hold investment is the BetaShares NASDAQ 100 ETF.

This hugely popular ETF needs little introduction. It is home to the 100 largest non-financial shares on the famous NASDAQ index. These are many of the largest companies in the world and household names. They provide the phones, search engines, streaming platforms, spreadsheets, and online stores we use every day.

VanEck Vectors Morningstar Wide Moat ETF (ASX: MOAT)

A third ASX ETF that could be a top buy and hold option is the VanEck Vectors Morningstar Wide Moat ETF.

If you aspire to invest like Warren Buffett, then this ETF could be an easy way to replicate his strategy. It holds companies with fair valuations and wide moats (competitive advantages). These are two qualities that Buffett looks for when buying shares.

And given his track record over multiple decades, this focus certainly has its advantages.

Betashares Global Quality Leaders ETF (ASX: QLTY)

A final ETF to look at is the Betashares Global Quality Leaders ETF. It provides investors with access to the world’s highest quality companies.

To make the cut, the companies need to have high return on equity and profitability, low leverage, and earnings stability.

In addition, the 150 high quality companies included in this ASX ETF come from a range of geographies and global sectors, many of which are under-represented in the Australian share market. Betashares’ chief economist, David Bassanese, recently recommended the fund.

The post Buy and hold these ASX ETFs until 2030 appeared first on The Motley Fool Australia.

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Motley Fool contributor James Mickleboro has positions in BetaShares Nasdaq 100 ETF. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended BetaShares Global Cybersecurity ETF and BetaShares Nasdaq 100 ETF. The Motley Fool Australia has positions in and has recommended BetaShares Global Cybersecurity ETF and BetaShares Nasdaq 100 ETF. The Motley Fool Australia has recommended VanEck Morningstar Wide Moat ETF. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

There are a few ASX stocks that make up a significant portion of my portfolio. The one that may give me the least stress of all is Washington H. Soul Pattinson and Co. Ltd (ASX: SOL), even though it has a 13% weighting at the moment.

I regularly write about this business as an option for ASX dividend share investors or retirees. However, I also think it makes a lot of sense for me, as someone in their younger 30s.

Everyone should aim to own investments that suit their preferred investment style and objectives. I’m looking for investments that can deliver long-term capital growth and long-term passive income growth. Ideally, my portfolio won’t be as volatile as the market during difficult times, but that can’t be guaranteed.

The investment conglomerate has been operating for over 120 years. It has shown an impressive ability to thrive through global pandemics, world wars, recessions, stock market crashes and various politicians. There’s more to it than just the age though.

There are three main reasons why I don’t lose any sleep at all owning this ASX stock.

Highly diversified

The S&P/ASX 200 Index (ASX: XJO) share isn’t just a single operating business like a bank or a supermarket – it owns a portfolio of assets.

It’s invested across assets like large-cap ASX shares, small-cap ASX shares, credit/loans, private equity and property.

In terms of sectors, it has exposure to areas like building products, financial services, telecommunications, resources, agriculture, electrification and swimming schools.

Looking at the individual businesses that it owns stakes in, Soul Patts owns part of ASX stocks like Brickworks Limited (ASX: BKW), New Hope Corporation Ltd (ASX: NHC), TPG Telecom Ltd (ASX: TPG), Tuas Ltd (ASX: TUA), BHP Group Ltd (ASX: BHP), Macquarie Group Ltd (ASX: MQG), CSL Ltd (ASX: CSL), Goodman Group (ASX: GMG) and Wesfarmers Ltd (ASX: WES).

By being so diversified, the business significantly lowers its risks compared to most other ASX 200 shares.  

Regularly investing in new opportunities

Soul Patts doesn’t just sit there with its portfolio and hope for the best. One of my main worries when committing to any ASX stock in the long term is its ability to adapt to a changing world and various economic conditions.

I don’t know what the Soul Patts portfolio will look like in 20 years, but I believe it will be future-focused with the potential to deliver good long-term returns.

The company is willing to sell existing holdings and make compelling new investors.

For example, in May 2022, Soul Patts acquired the rest of Ampcontrol it didn’t already own in its private equity portfolio. This business provides “electrical solutions for the energy, infrastructure and resource industries”. Ampcontrol’s earnings before interest and tax (EBIT) are forecast to have doubled between FY22 and FY24 to $37 million.

The business has also been investing in its agricultural portfolio and its credit portfolio, both of which could deliver good long-term returns for the ASX share.

Shareholder-focused

The impressive dividend record – the payout has grown every year since 2000 – shows me that the business wants to reward long-term shareholders with cash payouts.

I think it’s also a good sign that the business wants to send some of the cash to shareholders every year rather than trying to build an empire and potentially make too-risky moves.

I’m not expecting Soul Patts to grow its dividend every year – that can’t be certain. But, I think a growing dividend can provide a nice source of ‘real’ returns during investor ownership of the ASX stock.

I do want Soul Patts to make acquisitions every so often if the right deal comes along, as long as the investment team don’t overpay for it.

It’s not at a bargain price, but I think it can continue to perform over the long term.

The post This ASX stock is 13% of my portfolio and I don’t lose a second of sleep over it appeared first on The Motley Fool Australia.

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Motley Fool contributor Tristan Harrison has positions in Brickworks and Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Brickworks, CSL, Goodman Group, Macquarie Group, Washington H. Soul Pattinson and Company Limited, and Wesfarmers. The Motley Fool Australia has positions in and has recommended Brickworks, Macquarie Group, Washington H. Soul Pattinson and Company Limited, and Wesfarmers. The Motley Fool Australia has recommended CSL and Goodman Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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

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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 Block, Nanosonics, and WiseTech Global. The Motley Fool Australia has positions in and has recommended Block, Nanosonics, and WiseTech Global. The Motley Fool Australia has recommended Flight Centre Travel Group and Seek. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

There’s only one word that can describe the S&P/ASX 200 Index (ASX: XJO)’s performance this Monday: fire. ASX 200 shares, including CSL Ltd (ASX: CSL), were indeed on fire today.

Not only did the index add a healthy 0.73%, but it has also hit yet another new record high. Yep, the ASX 200 clocked a fresh record of 8,037.3 points this morning. That was shortly after blowing through the psychologically-important 8,000-point threshold for the first time ever as well.

But let’s talk about ASX 200 healthcare giant CSL.

New ASX 200 highs all around

It was a top day for CSL shares as well. The ASX’s third-largest stock also saw its shares at a fresh new high today, albeit a 52-week one. This morning, the CSL share price opened at $308.93 a share after closing at $306.60 last week. But soon after, those same shares climbed up to a flat $311, the new high watermark for CSL.

At market close, the company cooled off a little to end the day up a decent 0.64% at $308.56.

This share price puts CSL up by 7.03% in 2024 to date. This company is also sitting on a 12-month gain of 19.22%.

Saying that, CSL’s new 52-week high isn’t nearly as momentous as that of the broader ASX 200. The company has been here several times before. At least once a year since 2020, CSL shares have ascended above $310 a share. It happened in 2020, 2021, 2022 and 2023. But each time CSL hit this milestone in the past, investors got cold feet and subsequently sent the company lower.

So, while today marks the first time in 12 months that CSL shares have had ‘311’ at the front of their pricing, we have to go way back to early 2020 to find the last time CSL was at an all-time high. That occurred on 20 February 2020, when CSL hit $342.72 a share.

But it’s now more than four years later, and we still haven’t seen CSL get anywhere near that all-time record high.

Check all of this out for yourself here:

What’s next for CSL shares?

Fortunately for CSL investors, ASX brokers seem to be excited about what lies in store for the CSL share price.

Last week, my Fool colleague James covered broker Bell Potter’s bullish view of the healthcare stock.

Calling CSL “an attractive buying opportunity”, here’s some of what the broker said:

CSL has been in a holding pattern since 2020, and for good reason. COVID hit the business with higher collection costs for plasma, depressing margins. We anticipate the start of a margin recovery phase for CSL, driving above-market earnings growth over the next few years…

Given the company’s proven quality and growth prospects, we believe significant upside remains.

It’s not just Bell Potter though. We’ve recently covered the views of brokers at Macquarie. Macquarie is also bullish on CSL shares, giving the company a buy rating as well as a 12-month share price target of $330.

Like Bell Potter, Macquarie sees substantial potential for CSL to grow its earnings over the next few years, and as such, views the current CSL share price as undervalued.

No doubt these optimistic projections will be welcomed by CSL’s investors. But, as always, we’ll have to wait and see if today’s new 52-week high is a sign of things to come.

The post CSL shares hit new 52-week high! What’s next? appeared first on The Motley Fool Australia.

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Motley Fool contributor Sebastian Bowen has positions in CSL. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended CSL and Macquarie Group. The Motley Fool Australia has positions in and has recommended Macquarie 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.

ASX bank shares have been on a tear. Over the past year, the S&P/ASX 200 Banks Index (ASX: XBK) soared 30%, surpassing the S&P/ASX 100 Index (ASX: XTO), which rose shy of 10% during the same period.

Now, all eyes are on the upcoming reporting season to take cues for the next move from here.

Meanwhile, some US banks have already started reporting earnings, starting with Wells Fargo & Co (NYSE: WFC), Citigroup Inc (NYSE: C), and JP Morgan Chase & Co (NYSE: JPM).

Of particular interest were Wells Fargo shares, which plunged nearly 6% after reporting earnings last Friday.

What caused this drop, and can we take cues from the Wells Fargo earnings for ASX bank shares?

Weaker net interest income from Wells Fargo

In the second quarter, from April to June 2024, Wells Fargo recorded US$11.92 billion in net interest income, down 9% from a year ago. Noninterest income grew 19% to US$8.77 billion, leading to a revenue growth of 1% to US$20.53 billion. Net income decreased slightly by 1% from a year ago to US$4.91 billion. Wells Fargo CEO Charlie Scharf said:

We continued to see growth in our fee-based revenue offsetting an expected decline in net interest income.

The bank explained that the lower net interest income was due to the impact of higher interest rates on funding costs and lower deposit balances. The surge in noninterest businesses was driven by higher trading revenue in its Markets division and higher fees in investment banking and wealth management services.

Looking ahead, Wells Fargo expects FY24 net interest income to fall 8% to 9%, compared to previous guidance of 7% to 9%. The bank expects higher expenses for the full year due to higher compensation expenses and a special assessment expense. Reflecting this, the bank guided for noninterest expense of US$54 billion, compared to the previous guidance of US$52.6 billion.

Wells Fargo shares had risen 32% over the past year before Friday’s 6% fall. The company’s results and weaker FY24 guidance were insufficient to meet the heightened market expectations. While total revenue and profits were in line with analysts’ expectations, the weaker performance in net interest income and FY24 guidance disappointed investors.

Wells Fargo’s rapid contraction in net interest income might be a good indication of what to look for when ASX banks report.

How did ASX bank shares perform so far?

Like US banks, ASX bank shares rose substantially in the past year. Share price performances and FY25 price-to-earnings (P/E) ratios based on S&P Capital IQ estimates are:

• Commonwealth Bank of Australia (ASX: CBA) shares rose 30% in a year and trade at FY25 P/E of 23x
• Westpac Banking Corp (ASX: WBC) shares rose 31% in a year and trade at FY25 P/E of 15x
• National Australia Bank Ltd (ASX: NAB) shares rose 37% in a year and trade at FY25 P/E of 16x
• ANZ Group Holdings Ltd (ASX: ANZ) shares rose 21% in a year and trade at FY25 P/E of 13x

ASX banks expect to report their earnings updates in August 2024, mostly between 14 and 20 August.

The post Prepare for earnings! What ASX bank share buyers can learn from Wells Fargo results? appeared first on The Motley Fool Australia.

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JPMorgan Chase is an advertising partner of The Ascent, a Motley Fool company. Wells Fargo is an advertising partner of The Ascent, a Motley Fool company. Citigroup is an advertising partner of The Ascent, a Motley Fool company. Motley Fool contributor Kate Lee 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 JPMorgan Chase. 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.

We won’t know how stock markets in the United States will respond to this weekend’s attempted assassination of former US President Donald Trump until US markets open on Monday morning (overnight Aussie time).

We do know that the S&P/ASX 200 Index (ASX: XJO) has just roared into new all-time high record territory, currently up 0.6% at 8,006 points.

And we know that S&P 500 Index (SP: .INX) futures are up 0.2%, indicating a likely positive start to the week in US stock markets.

This comes after Trump, who’s running against incumbent President Joe Biden in hopes of retaking the White House in November’s presidential elections, survived a sniper attack at a campaign rally on Saturday (Sunday morning in Australia).

A bullet grazed the former president’s ear, and a spectator was tragically killed in the attack, with several others wounded before police eliminated the 20-year-old shooter.

While our most ardent hope is that this heinous attack marks an end to escalating political tensions and violence, our beat is the stock markets.

With that in mind, here’s what investors might expect in the wake of the failed assassination attempt on Donald Trump.

How the Trump shooting could impact stock markets

Biden’s popularity was already plunging amid concerns over the 81-year-old’s potentially deteriorating mental faculties following the recent presidential debate. Now, Trump’s literal dodging of a bullet and subsequent defiant public appearances are widely seen to have boosted Trump’s election chances.

So, what does that mean for the ASX and global stock markets?

According to Nick Twidale, chief market analyst at ATFX Global Markets (quoted by The Australian Financial Review), “Undoubtedly, there’ll be some protectionist or haven flows in the Asia early morning. I’d suspect gold could test all-time highs, we will see the yen getting bought and the dollar and flows into Treasuries too.”

To date, we haven’t seen any major moves in the gold price, with the yellow metal trading near its Friday levels of US$2,411 per ounce.

Cryptocurrencies are another story.

Kyle Rodda, senior financial market analyst at Capital.com, said (quoted by Bloomberg), “This news marks a changing point in American political norms. For markets, it means haven trades but more skewed towards non-traditional havens.”

Rodda said he had noted more client flows into Bitcoin (CRYPTO: BTC) and gold after the shooting. Indeed, the Bitcoin price is up 6.5% since the Trump campaign rally attack, currently at US$62,486.

Stock market volatility likely to spike

Investors should also prepare for more stock market volatility, said Frank Monkam, senior portfolio manager at Antimo.

According to Monkam:

Yesterday’s assassination attempt of President Trump is likely to mark the ‘grand opening’ of an elevated period of volatility for risk assets. Trump trades are also poised to move on the high conviction list for investors, with a particular focus on rates markets where the re-pricing of fiscal profligacy will look to offset the prospects of imminent Fed cuts.

With Trump favouring tariffs and looser fiscal policies, analysts are also forecasting a stronger greenback and weaker US Treasuries.

“The bond market should at some point, become aware of President Trump’s higher odds of winning the White House than any of his rivals. And I continue to believe that as his odds rise, so should the probability of a bond market riot,” Marko Papic, chief strategist at BCA Research, said.

Traditional energy companies could benefit as part of the so-called Trump trade while renewable energy companies could see their stock market prices come under pressure.

According to Michael Purves, CEO of Tallbacken Capital Advisors, there’s also the potential that ASX and US stock market investors could now see the US Fed opt to hold interest rates higher for longer.

“Trump’s stated policies are (at least now) more inflationary than Biden’s, and we think the Fed will want to accumulate as much dry power as possible,” Purves said.

Foolish takeaway

While I generally like to craft my own Foolish takeaway on the stock markets, I don’t think I could put it any better than Oliver Pursche, senior vice president at Wealthspire Advisors.

According to Pursche (quoted by Bloomberg):

Regardless of what may or may happen Monday morning [US time], not reacting may prove to be the smartest thing you can do as a stock investor because generally people overreact in the wrong direction.

Markets will find their equilibrium and get back to the things that matter from an investment perspective, which are economic growth, monetary and fiscal policy and corporate earnings.

The post How is the stock market reacting to yesterday’s attack on Trump? appeared first on The Motley Fool Australia.

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• 5 things to watch on the ASX 200 on Monday
• Here’s how the ASX 200 market sectors stacked up last week
• Xero shares doubled the ASX 200 return in FY24. What’s next in FY25?
• Here are the top 10 ASX 200 shares today

Motley Fool contributor Bernd Struben 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 Bitcoin. The Motley Fool Australia has positions in and has recommended Bitcoin. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The NIB Holdings Limited (ASX: NHF) share price is up 0.5% amid a leading expert’s rating change on the ASX healthcare share. This coincides with the S&P/ASX 200 Index (ASX: XJO) rising by 0.6%, so the stock is not outperforming.

As we can see on the chart above, NIB shares are down by 7% in the last month. This sizeable decline in a relatively short amount of time has led one expert to think that the NIB share price is now good value.

Let’s have a look at how much upside broker Morgans thinks the ASX healthcare share has.

Buy rating on NIB shares

According to reporting by The Australian, Morgans Financial has decided to change its rating to add on NIB shares.

A price target on a business tells us where the broker thinks the share price will be in 12 months. Analysts don’t have a crystal ball, but it’s just their best guess about where the valuation will go. If they’re correct, some price targets can imply large shareholder gains.

As reported by The Australian, the price target on the ASX healthcare share is $7.92. That suggests a possible rise of 13%. Combine that with the potential dividends over the next 12 months, and we’re looking at a possible mid-to-high-teen return from NIB shares.

What has happened in recent times for the ASX healthcare share?

The company’s last price-sensitive announcement was in March 2024. It revealed that its health insurance premiums would increase by an average of 4.1%. Its previous two increases, in 2023 and 2024, were the two lowest increases of the past 20 years.

At the time, NIB acknowledged that many household budgets were strained, but spending was growing across healthcare, driven by “an ageing population, the rise of chronic conditions and the cost of new technologies.”

NIB’s management noted that it aspires to be a health management and health insurance company.

The company also recently presented at the Macquarie conference in May. In that presentation, it showed that its revenue had grown every single year since FY05 and its underlying operating profit has been growing over the long term as well, aside from the COVID-hit years.

One of NIB’s successes in recent years has been expanding into adjacent markets such as New Zealand, international workers and students, travel insurance, disability ‘navigation’, and more. The business has also been growing its market share in the core Australian private health insurance market.

NIB aims to become the disability sector’s leading navigator by supporting NDIS participants and others with identified disabilities. It aims to reach around 50,000 participants by the end of FY25.

Outlook for NIB shares

In FY24, the business is expecting to achieve net policyholder growth of between 3% and 4% while maintaining stable underlying margins, before gradually returning to the target of between 6% and 7%.

Morgans seems confident on the company’s outlook.

The post NIB shares rise as top broker calls the stock a buy appeared first on The Motley Fool Australia.

More reading

• Analysts love Woodside and these ASX dividend stocks
• Will NIB shares bleed to keep St Vincent’s onside?

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 Macquarie Group. The Motley Fool Australia has positions in and has recommended Macquarie Group and NIB Holdings. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.