Category: Stock Market

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

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

Aristocrat Leisure Limited (ASX: ALL)

According to a note out of Citi, its analysts have retained their buy rating and $51.00 price target on this gaming technology company’s shares. This follows the release of a first half result which came in well ahead of the broker’s expectations. This was driven largely by lower than expected costs and a strong performance from its Rest of World segment. The latter offset a slightly softer than expected performance in the United States. Outside this, the broker is supportive of the company’s plan to look at the sale of its digital assets given how their growth has slowed. Though, the price it receives for these assets will be key. All in all, the broker remains very positive on the company and sees value in its shares despite yesterday’s rally. The Aristocrat Leisure share price is trading at $45.71 today.

Graincorp Ltd (ASX: GNC)

A note out of Bell Potter reveals that its analysts have retained their buy rating on this grain exporter’s shares with an improved price target of $9.50. This follows the release of a half year result that was modestly ahead of the broker’s expectations. Bell Potter was also pleased to see that its FY 2024 guidance remains unchanged and that its through the cycle EBITDA has been upgraded from $310 million to $320 million. This reflects the inclusion of the XF Australia feeds acquisition. But it may not stop there. It notes that its through the cycle earnings would likely lift on any new oilseed crush capacity, which is being investigated. The Graincorp share price is fetching $8.53 this afternoon.

Incitec Pivot Ltd (ASX: IPL)

Analysts at Goldman Sachs have retained their buy rating on this fertiliser and commercial explosives company’s shares with an improved price target of $3.35. Goldman was pleased with Incitec Pivot’s half year results, noting that there was solid APAC pricing momentum. In addition, it highlights that the Fertiliser sale process is ongoing with PT Pupuk Kalimantan Timur and that management has flagged a transformation program. The latter is expected to target pricing, cost and working capital disciplines. But importantly, it believes the program could represent upside to consensus estimates. The Incitec Pivot share price is trading at $2.92 on Friday.

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

More reading

• 5 things to watch on the ASX 200 on Friday
• Here are the top 10 ASX 200 shares today
• Why is this ASX 200 stock surging despite a $500 million writedown?
• Why Aristocrat Leisure, Graincorp, Incitec Pivot, and Patriot Battery Metals shares are rising today
• Guess which ASX 200 stock is surging 11% on an ‘outstanding’ result

Citigroup is an advertising partner of The Ascent, a Motley Fool company. 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 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.

Mineral Resources Ltd (ASX: MIN) shares have been on a tear since mid-January, when the ASX 200 mining stock hit a 52-week low of $52.52.

That was back on 22 January, and since then, Mineral Resources shares have had one heck of a rebound.

At the time of writing on Friday, they’re up 0.59%, trading at $78.45 after touching a 52-week high of $79.27.

In fact, the S&P/ASX 200 Materials Index (ASX: XMJ) is the only market sector in the green on Friday following news of A$210 billion of economic stimulus in China which is likely to boost iron ore demand.

The rest of the market seems to be cooling off from yesterday’s excitement. The S&P/ASX 200 Index (ASX: XJO) is limping along on Friday afternoon, carrying a 0.72% loss.

Now, back to Minerals Resources shares and whether it’s too late to buy them after this recent run.

Is it too late to buy Mineral Resources shares?

The answer to this question depends on who you ask.

First to top broker, Morgan Stanley.

Earlier this month, the broker upped its share price target on Mineral Resources shares by 24% to $83.

So by this measure, Mineral Resources shares still have a little bit of upside to offer at 4.8%.

Next, Bell Potter.

Its analysts retained their buy rating on Mineral Resources shares in a note published in late April.

They raised their 12-month share price target to $85. So, the potential upside is a tad better at 7.35%.

Bell Potter liked the company’s quarterly update released on 24 April.

The broker noted sales volumes were above its own forecasts and it was happy to see the recommencement of spodumene concentrate sales from the Wodgina lithium mine.

Mineral Resources also reported an improvement in its spodumene prices at the end of the quarter with a 22,000 tonnes shipment sold at US$1,300 per tonne for SC6 equivalent. This compares to the quarterly average of US$1,030 per tonne.

Another positive was the Onslow Iron Project remaining on track to export its first ore in June.

Finally, we look to Goldman Sachs for their view on Mineral Resources shares.

It’s vastly different from Bell Potter and Morgan Stanley.

Mining giant has 40% potential downside from here

Goldman not only has a sell rating on Mineral Resources, it also thinks the shares were too expensive to buy at their 52-week trough!

The broker has a 12-month share price target of $47 on Mineral Resources today. This implies a significant potential downside of 40% over the next 12 months.

This broker had a different take on the company’s quarterly report, noting that lithium and iron ore production and realised prices had not met Goldman’s own forecasts.

However, Goldman still likes the company and its track record for delivering impressive returns.

The broker commented:

We continue to highlight that MIN has an impressive 20-yr track record of generating high returns on capital with an average ROIC of >20% since listing.

This has been achieved through MIN’s ability to build and operate crushing plants and mining projects faster and at lower capital intensity than most other companies.

Despite this impressive track record, we continue to rate MIN a Sell …

Goldman said the reasons for its sell rating included Mineral Resources being fully valued compared to its peers. It is also trading well above its net asset value (NAV), which Goldman places at $54.60 per share.

The broker also cited its expectations of further falls in lithium prices.

This, coupled with higher capex costs at Onslow, leads the broker to believe that Mineral Resources will generate low or negative free cash flow in FY24 and FY25.

Goldman also says the company’s balance sheet is “highly geared but debt covenant light”.

The post Up 51% from their 52-week low, is it too late to buy Mineral Resources shares? appeared first on The Motley Fool Australia.

More reading

• 4 founder-led ASX 300 shares that have helped this fund outperform
• Here are the top 10 ASX 200 shares today
• Guess which 3 ASX 200 stocks just earned major broker upgrades!
• Brokers name 3 ASX shares to buy now
• ASX lithium shares tumble as falling prices hit export values

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 Goldman Sachs Group. 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.

Fancy investing in an ASX All Ords stock that would have seen your investment balloon by an eye-watering 292% in just three years?

Me too!

After all, the All Ordinaries Index (ASX: XAO) returned a far more ordinary 11.5% (excluding dividend payouts) over this same period.

The star performer in question is ASX coal miner Yancoal Australia Ltd (ASX: YAL).

Here’s how the company would have grown a $9,000 investment three years ago into a whopping $35,234 today.

ASX All Ords stock delivers the goods

Three years ago, in mid-May 2021, you could have bought the ASX All Ords stock for $2.01 a share.

Meaning your $9,000 investment would have netted you 4,477 Yancoal shares and a bit of pocket change.

By the end of 2021, your ASX investment would already be up some 30%, while you probably spent that pocket change.

And things really began to heat up in 2022.

That year, thermal coal prices more than doubled to reach all-time highs following Russia’s invasion of Ukraine. The Yancoal share price also notch its own record highs.

Although the coal price has tumbled more than 65% since those record highs, the Yancoal share price has held up much better, as the ASX All Ords share continues to be a cash-generating machine.

In afternoon trade today, Yancoal shares are swapping hands for $5.95 apiece.

So, the 4,477 shares you bought three years ago would be worth a rounded $26,460 today. Which, you might be thinking, is well below the headline-grabbing $35,234 mentioned above.

What gives?

The dividends, of course!

Don’t forget the passive income

Over the past three years the ASX All Ords stock has not only seen its share price rocket, it’s also delivered shareholders some seriously outsized passive income.

If you’d bought shares in May 2021, you have been eligible to receive the past three dividend payouts, all but one of which were fully franked.

Those four payouts work out to $1.92 per share.

So, if we add that into the current Yancoal share price of $5.95, the accumulated value of this ASX All Ords stock over the past three years works out to $7.87 per share.

Meaning your 4,477 shares would have netted you $35,234 by today, with some potential tax benefits from those franking credits.

Boom!

Now, as always, before investing in Yancoal shares or any other ASX stock, do your own research or seek expert advice.

The post How a $9k investment in this ASX All Ords stock ballooned to $35,234 in just 3 years! appeared first on The Motley Fool Australia.

More reading

• Here’s how the ASX 200 market sectors stacked up last week
• Up 9% in a month, this ASX 300 stock is my top pick for May
• ASX coal shares higher despite major superannuation fund walking away
• My top ASX dividend pick for 2024 is a passive income powerhouse
• 2 ASX passive income shares paying 8% and 13% yields

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 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 originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

Nvidia (NASDAQ: NVDA) stock is having another great year. In 2024, shares of the artificial intelligence (AI) tech giant have gained 91.9% through May 15, crushing the S&P 500 index’s 11.9% return. The stock’s longer-term performance is even more stunning, as it turned an investment of $5,000 into nearly $1 million over the last decade through April 29.

A catalyst that might propel Nvidia stock higher is coming on Wednesday, May 22, after the market close. That’s when the company is scheduled to release its results for its quarter ended on April 28.

Given Nvidia stock’s fantastic recent performance, expectations are high and built into the stock price. For the stock to rise after the report, the company will likely have to at least comfortably beat Wall Street’s estimates for the quarter and issue guidance for the next quarter that’s notably higher than analysts are projecting.

What are Wall Street’s expectations?

You can use the below chart to gauge Nvidia’s fiscal first-quarter results.

Metric	Fiscal Q1 2024 Result	Nvidia’s Fiscal Q1 2025 Guidance	Nvidia’s Projected Change	Wall Street’s Fiscal Q1 2025 Consensus Estimate	Wall Street’s Projected Change
Revenue	$7.19 billion	$24 billion	234%	$24.57 billion	242%
Adjusted earnings per share (EPS)	$1.09	$5.41*	396%	$5.57	411%

Data sources: Nvidia and Yahoo! Finance. Fiscal Q1 2025 ended April 28, 2024. *Calculated by the author based on the metrics for which management provides guidance. Data as of May 15, 2024.

The below chart can be used to gauge Nvidia’s guidance for its fiscal second quarter.

Metric	Fiscal Q2 2024 Result	Wall Street’s Fiscal Q2 2025 Consensus Estimate	Wall Street’s Projected Change
Revenue	$13.51 billion	$26.57 billion	97%
Adjusted EPS	$2.70	$5.92	119%

Data sources: Nvidia and Yahoo! Finance. Fiscal Q2 2025 ends in late July 2024. Data as of May 15, 2024.

Two reasons Nvidia seems poised to beat Wall Street’s expectations

The first reason Nvidia looks poised to beat Wall Street’s estimates has to do with management “visibility.” Nvidia’s top management team has said on the company’s recent quarterly analyst earnings calls that it has good visibility into near-term sales in its data center business. That’s because the company has a backlog of orders to fulfill due to demand being so strong for its AI-enabling data center chips and related products.

Management probably has less of a handle on near-term demand for products in some of its other businesses. But that doesn’t matter much because data center is by far Nvidia’s largest market platform, and so it drives overall results.

The better management’s visibility into near-term sales, the better idea it has of its near-term financial results. You can be sure Nvidia’s savvy top management team set fiscal Q1 guidance at levels it feels very confident the company will exceed. Wall Street analysts use Nvidia’s guidance to help establish their estimates. For many years analysts have underestimated the company’s growth potential, and my bet is this dynamic will continue.

The second reason that Nvidia’s upcoming report — including from a fiscal Q2 guidance standpoint — seems poised to be better than analysts expect stems from the recent quarterly reports of several of Nvidia’s biggest customers. Companies such as Facebook parent Meta Platforms, Alphabet, and Microsoft are continuing to ramp up their already significant spending on AI initiatives, which is a positive for Nvidia.

For instance, Meta now expects its full-year 2024 capital expenditures to range from $35 million to $40 million, up from its prior plan of $30 million to $37 billion. This is due to the company continuing to “accelerate our infrastructure investments to support our AI roadmap,” CFO Susan Li said on the Q1 earnings call.

Should you buy Nvidia stock before May 22?

Of course, there are no guarantees, but I think it’s more likely than not that Nvidia stock will rise after the upcoming earnings release for the reasons just outlined. And there’s another possible catalyst: The timing seems good for the company to announce a stock split.

That said, if you’re a long-term investor, you don’t need to concern yourself with trying to time your stock buys. Over the long term, if your bullish thesis is correct for Nvidia, it shouldn’t make that much difference if you paid a bit more or less for its stock many years back.

Let’s look at an example. Nvidia stock closed at $946.30 per share on May 15. Exactly five years ago, the stock closed at $39.90, adjusted for stock splits. If you invested $1,000 in Nvidia stock five years ago, your investment would now be worth $23,717. Had you invested in the stock about five years ago and its price per share was, say, 15% higher than $39.90, or $45.89, your investment would now be worth $20,621. I’m guessing you’d be thrilled to have turned your $1,000 into nearly $21,000 in five years, and not kicking yourself for not doing a little better.

A smart way to build your position in any stock is to invest the same dollar amount at regular intervals, such as monthly or quarterly. This method eliminates the potential that you’ll invest your entire amount at what turns out to be a near-term peak for the stock price. 

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

The post Nvidia stock’s next big catalysts could come on May 22. Should you buy shares before then? appeared first on The Motley Fool Australia.

More reading

• 3 reasons to buy Nvidia stock before May 22 (and 1 reason to sell)
• What exactly does Nvidia do?
• 2 US artificial intelligence (AI) stocks that could beat Nvidia in the coming decades
• Is it too late to buy Nvidia stock?
• 3 things ASX investors should watch this week

Beth McKenna has positions in Nvidia. 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. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Alphabet, Meta Platforms, Microsoft, and Nvidia. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. 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, Meta Platforms, Microsoft, and Nvidia. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The uranium industry has been one of the hottest areas of the market this year.

In light of this, it is hardly surprising that one ASX uranium stock is charging higher today despite the market being a sea of red.

The uranium stock in question in is Alligator Energy Ltd (ASX: AGE).

In afternoon trade, its shares are up 5% to 6.2 cents. This means that they are now up over 100% since this time last year.

Why is this ASX uranium stock charging higher today?

Investors have been buying the company’s shares today after it released an announcement in relation to the Big Lake Uranium Project in the Cooper Basin, South Australia.

According to the release, its inaugural stratigraphic drill program for the Big Lake project is now underway.

The release notes that the Big Lake project is targeting northern extensions of the same Namba, Eyre and Winton sedimentary formations which host the Beverley, Four Mile and Honeymoon In-Situ Recovery (ISR) uranium mining operations in South Australia.

The ASX uranium stock has high hopes for the project. It highlights that it has many attributes of similar global hydrocarbon-related ISR uranium fields. Furthermore, an historical drilling program in the region by a previous company ~16 years ago indicated the presence of uranium in thin bands.

Drilling contractor Wallis Drilling has been engaged to conduct up to 40 aircore holes on 3 to 4 hole fences, with an average depth of 150 metres.

The good news for shareholders is that they may not have to wait long to find out what lies underground. That’s because subject to final drilling metres, assays and analysis of the results are expected to be available in either August and September.

After which, management notes that results from this field program will inform a more targeted drilling program focused on the best opportunities to intersect uranium mineralisation within this portion of the Cooper Basin. This is scheduled for either later in 2024 or early 2025.

Commenting on the drilling program, the ASX uranium stock’s CEO, Greg Hall, said:

We are very pleased to begin this long-awaited program and are fully appreciative to the Traditional Owners and other Stakeholders that have facilitated access. While at a very early green-field stage of the exploration/resource pipeline, all the signs are there that this has the potential to be a uranium-bearing basin following the Kazakhstan model. This drilling program is the start of our proof-of-concept work.

The post Guess which ASX uranium stock is charging higher today appeared first on The Motley Fool Australia.

More reading

• How to invest in uranium on the ASX
• Top ASX shares to buy in May 2024
• 1 ASX penny stock I’d buy now while it’s only 5 cents

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 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 S&P/ASX 200 Index (ASX: XJO) is having a disappointing finish to the week. In afternoon trade, the benchmark index is down 0.7% to 7,824.2 points.

Four ASX shares that are falling more than most today are listed below. Here’s why they are dropping:

Clearview Wealth Ltd (ASX: CVW)

The Clearview Wealth share price is down 2.5% to 68.5 cents. This follows news that a major shareholder is selling down its holding in the financial services company. It advised that certain funds managed or advised by Crescent Capital Partners have agreed to sell in aggregate 73,114,246 shares to a range of sophisticated and institutional investors by way of a block trade at 59 cents per share. Crescent Funds will be left holding 225,174,975 Clearwiew Wealth Shares, representing approximately 34.59% of the shares on issue.

Loyal Lithium Ltd (ASX: LLI)

The Loyal Lithium share price is down 5.5% to 25.5 cents. This morning, the lithium explorer announced that it has received firm commitments to raise $3.3 million through the issue of 7,345,744 new shares at an issue price of ~$0.45 per share. This represents a significant premium to its current share price. However, this premium is the result of the company utilising the “flowthrough shares” provisions under Canadian tax law. These shares provide tax incentives to investors for expenditures that qualify as flow-through critical mineral mining expenditures.

Polynovo Ltd (ASX: PNV)

The Polynovo share price is down 3.5% to $2.12. This may have been driven by profit taking from some investors during today’s very red session. After all, this medical device company’s shares have been on a great run of late. For example, since this time six months ago, Polynovo’s shares have risen over 50%. Over the same period, the ASX 200 index is up by 11%. Strong sales growth appears to have been the driver of Polynovo’s gains.

Weebit Nano Ltd (ASX: WBT)

The Weebit Nano share price is down a further 7% to $2.26. This is despite there being no news out of the semiconductor company. However, it is worth noting that its shares have been under significant pressure since the release of its quarterly update. So much so, they are down almost 30% since its release. Investors appear to be finally waking up to the fact that it doesn’t deserve to trade with such a lofty valuation when it is pulling in zero cash receipts and burning through cash like it is kindling.

The post Why Clearview, Loyal Lithium, Polynovo, and Weebit Nano shares are falling appeared first on The Motley Fool Australia.

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• ASX 300 fallen star down 62% in a year hits new 52-week low: Time to buy?
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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 PolyNovo. 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.

Top broker Goldman Sachs says its key buy calls among ASX retail shares are now skewed towards consumer staple shares over discretionary shares.

In a new note to clients this week, Goldman analysts Lisa Deng and James Leigh said they currently “see better value in staples where valuation and earnings expectations are less demanding”.

Deng and Leigh said consumers were “clearly increasingly value-focused” amid anticipated delays in interest rate cuts or even another hike this year.

What’s happening in retail these days?

The latest retail figures from the Australian Bureau of Statistics (ABS) revealed the “weakest growth on record” outside the pandemic and the introduction of the GST.

Retail turnover has increased by just 0.8% over the 12 months to 31 March, despite massive population growth due to high immigration.

Turnover fell by a seasonally adjusted 0.4% in the month of March.

This followed gains of 1% in January and 0.2% in February.

ABS head of retail statistics Ben Dorber said:

Consumers pulled back on retail spending in March as cost of living pressures remained high.

Outside of the pandemic period and introduction of the GST, this is the weakest growth on record when comparing turnover to the same time in the previous year. 

Turnover was down in every sector in March, except food. The largest declines occurred in clothing, footwear and personal accessory retailing (down 4.3%) and department stores (down 1.6%).

Goldman’s take on consumer spending

Deng and Leigh said Goldman Sachs had changed its rate cut projection from August to November and “this is expected to impact discretionary spending” from here.

They noted recent ABS data showing declining discretionary spending, including a 1.9% annual drop in household goods sales, a 3.5% dip in electronic goods and a 3.7% fall in furniture sales.

They said:

Recent 3Q24 results, our deep-dive channel checks and the latest ABS retail data suggest that Australian consumers are increasingly price conscious and selective on spending.

Conversely for Staples … we continue to believe that market concern on ongoing regulatory inquiries (most important ACCC Inquiry interim report by August 31) is overdone.

Our latest conversations with key FMCG companies also note that volumes remain positive and while pricing is unlikely to see significant hikes from here, continued portfolio innovation to drive mix remains a growth lever.

The analysts mentioned ABS data showing a 3.8% lift in supermarket sales in the March quarter.

6 ASX retail shares to buy

In light of all this and following third-quarter updates from ASX companies, the analysts have updated their recommendations for ASX retail shares.

In order of preference, here are the ASX retail shares that Goldman says are a buy today.

Super Retail Group Ltd (ASX: SUL)

The Super Retail share price is $13.33, down 1.15% currently and 16.1% lower in the year to date.

Goldman has a 12-month share price target of $17.80 on the owner of Rebel and Supercheap Auto.

Woolworths Group Ltd (ASX: WOW)

The Woolworths share price is $31.80, down 0.16% now and 15.2% lower in the year to date.

Goldman has a 12-month share price target of $39.40 on the ASX retail supermarket share.

Endeavour Group Ltd (ASX: EDV)

The Endeavour share price is $5.14, down 1.34% currently and down 1.9% in the year to date.

Goldman has a 12-month share price target of $6.30 on the owner of BWS and Dan Murphys.

Treasury Wine Estates Ltd (ASX: TWE)

The Treasury Wine share price is $11.57, up 0.35% now and 8.2% higher in the year to date.

Goldman has a 12-month share price target of $13 on the ASX retail wine share.

Webjet Ltd (ASX: WEB)

The Webjet share price is $8.47, down 0.76% now but up 14.4% in the year to date.

Goldman has a 12-month share price target of $9.20 on the ASX retail travel share.

Breville Group Ltd (ASX: BRG)

The Breville share price is $25.48, down 2.75% currently and down 5.5% in the year to date.

Goldman has a 12-month share price target of $28 on the ASX retail share.

The post Goldman says these 6 ASX retail shares are a buying opportunity appeared first on The Motley Fool Australia.

More reading

• Looking to retire? Buy these ASX dividend shares for passive income
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• Which ASX shares could be set to benefit from the federal budget?
• Why this could be the best ASX 200 consumer staples stock to buy in May
• These ASX 200 blue chip shares could rise 10% to 30%

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

S&P/ASX 200 Index (ASX: XJO) mining shares are racing ahead of the benchmark today.

In early afternoon trade on Friday, the ASX 200 is down 0.66%.

Here’s how the big three ASX 200 mining shares are tracking at this same time:

• Fortescue Metals Group Ltd (ASX: FMG) shares are up 1.8% at $27.10
• BHP Group Ltd (ASX: BHP) shares are up 0.99% at $44.98
• Rio Tinto Ltd (ASX: RIO) shares are up 0.93% at $131.60

Here’s what’s happening.

ASX 200 mining shares lift on China stimulus plans

ASX 200 mining shares BHP, Rio Tinto and Fortescue are all catching some heady tailwinds today amid a 2.6% increase in the iron ore price. The critical steel-making metal is trading for just under US$117 per tonne.

Now, that’s well down from the US$144 that same tonne was fetching on 3 January. But iron ore has now surged more than 16% since 4 April, when it was trading for just under US$100 per tonne.

This once again defies numerous bearish analyst forecasts, which predicted iron ore would be trading at or below US$100 per tonne by now.

The strength of the industrial metal also lifted BHP and Rio Tinto in US markets, where the ASX 200 mining shares are also listed. BHP shares closed up 1.3% on the New York Stock Exchange (NYSE) overnight, while Rio Tinto shares gained 2.3%.

Investor enthusiasm for the big miners looks to be fuelled by China.

New economic data shows that while parts of China’s economy, like its manufacturing sector, are rebounding, other sectors continue to struggle. Particularly the nation’s sluggish property market.

In hopes of getting the economy back onto its growth track, the Chinese government said it would commence selling 1 trillion yuan (AU$210 billion) in its ultra-long special sovereign bonds today.

Much of this cash is expected to flow into the steel-hungry infrastructure sector. Analysts are also forecasting the potential of more monetary easing from the People’s Bank of China to make it, well, easier for banks to buy the bonds.

Commenting on the Chinese stimulus that looks to be lifting the ASX 200 mining shares today, ANZ Group Holdings Ltd (ASX: ANZ) stated (quoted by The Australian Financial Review):

Iron ore rose amid renewed optimism over Beijing’s efforts to tackle property crisis. This follows reports that China will start selling 1 trillion yuan of special bonds this week centred on boosting infrastructure spending.

The post ASX 200 mining shares charging higher amid China’s $210 billion cash injection appeared first on The Motley Fool Australia.

More reading

• What this unprecedented short squeeze signals for ASX copper stocks
• Buy Rio Tinto and these ASX 200 dividend shares
• What’s the outlook for ASX iron ore shares after the federal budget?
• How Fortescue shares could gain from the Federal budget
• How much passive income would I make from 300 BHP shares?

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 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.

In afternoon trade, the S&P/ASX 200 Index (ASX: XJO) has run of steam and is giving back some of yesterday’s stellar gains. At the time of writing, the benchmark index is down 0.65% to 7,831.1 points.

Four ASX shares that are not letting that hold them back today are listed below. Here’s why they are rising:

AIC Mines Ltd (ASX: A1M)

The AIC Mines share price is up 4.5% to 56 cents. This follows news that the mining lease for the Jericho Copper Mine has been approved for grant by the Minister for Resources and Critical Minerals Queensland. This allows for surface works at Jericho to commence within a maximum 10ha area and mine development activity to take place with a maximum of 20 people employed on site. Development of the Jericho mine and the expansion of the Eloise processing plant will lift production to over 20,000tpa copper and 7,500ozpa gold.

Bendigo and Adelaide Bank Ltd (ASX: BEN)

The Bendigo and Adelaide Bank share price is up over 7% to $10.67. This follows the release of a trading update from the regional bank. Management advised that its unaudited cash earnings (after tax) year-to-date is approximately $464 million. This is down 2.3% on the prior corresponding period. CEO, Marnie Baker, said: “The margin considerations we outlined in February have helped support a year-to-date margin of 1.87% post revenue share. We look forward to showcasing our growth engines at our Investor Day on 23 May 2024.”

Patriot Battery Metals Inc. (ASX: PMT)

The Patriot Battery Metals share price is up a further 11% to 97.5 cents. Investors have been buying this lithium developer’s shares since the release of a new batch of core assay results on Thursday. Those results were for drill holes completed this year at the CV5 spodumene pegmatite at its Corvette Lithium Project in Canada. The company’s vice president of exploration, Darren L. Smith, said: “Another round of CV5 core assays from our infill program and it continues to deliver to expectations. Coupled with the new high grade discovery at CV13, the 2024 winter program’s results continue to demonstrate the quality and scale on show at Corvette.”

Vulcan Energy Resources Ltd (ASX: VUL)

The Vulcan Energy share price is up almost 14% to $5.41. This morning, this lithium developer announced the formal launch of the second and final phase of its Project-level debt and equity funding package. Phase one of the Finance Process is now complete, with the company receiving significant interest from strategic and financial investors, commercial banks, the European Investment Bank (EIB), and major government-backed export credit agencies.

The post Why AIC Mines, Bendigo and Adelaide Bank, Patriot Battery Metals, and Vulcan Energy are racing higher today appeared first on The Motley Fool Australia.

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• Why Aristocrat Leisure, Graincorp, Incitec Pivot, and Patriot Battery Metals shares are rising today
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• Guess which ASX lithium stock dived 9% after parting ways with Albemarle

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 Bendigo And Adelaide Bank. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

ASX copper stocks have been among the best performers in the market in 2024.

And while most copper miners are sliding today, alongside the broader market, the future continues to look bright as the red metal surged another 2.0% overnight to US$10,424 per tonne.

That’s right near all-time highs. And it sees the red metal up 28% from this time last year, when that same tonne was trading for US$8,122.

As for that strong performance, shares in S&P/ASX 200 Index (ASX: XJO) copper stock Sandfire Resources Ltd (ASX: SFR) are up 57% over the past six months.

And the Aeris Resources Ltd (ASX: AIS) share price has surged 100% over the half year, compared to a 12% gain posted by the All Ordinaries Index (ASX: XAO).

Then there’s dual-listed, Canadian-based Capstone Copper Corp (ASX: CSC).

Capstone Copper only began trading on the ASX on 8 April. Since then shares have leapt 20%, compared to a 1% gain posted by the All Ords over this same period.

What’s boosting copper prices?

ASX copper stocks have obviously been benefiting from fast-rising copper prices.

The red metal has been supported by strong global demand growth, even though supplies have been disrupted at several major mines worldwide.

Expected interest rate cuts from major central banks, including the US Federal Reserve, could further fuel medium-term demand.

Longer-term tailwinds for ASX copper stocks are likely to come from the globe’s ongoing transition to electrification. The highly conductive red metal is a critical component in EVs, the new generation of AI-enabled data centres, and much more.

And despite the copper price already having surged 28% over 12 months, Goldman Sachs believes the metal is due to gain another 15%. The broker forecasts an end-of-year price of US$12,000 per tonne.

So, what’s all this about a big short squeeze?

I’m glad you asked!

ASX copper stocks and the big short squeeze

If you follow futures markets, you may have noticed the unprecedented short squeeze that has sent copper prices surging on the Comex over the past few days.

If you’re unfamiliar with Comex, it stands for the Commodity Exchange Inc.

The United States-based Comex is the primary futures and options market for trading base and precious metals. Ordinarily, the spread on copper futures on Commex and the price for copper on the London Metal Exchange (LME) vary by only a few dollars.

But as Bloomberg reports, the premium for New York copper futures has rocketed to US$1,200 per tonne, which has never been seen before.

This bodes well for the demand outlook for ASX copper stocks.

The short squeeze reportedly comes in part as traders pile in amid forecasts that copper supply growth will likely lag demand growth for years to come.

According to Matthew Heap, a portfolio manager at Orion Resource Partners:

The broader story is that there are new investment funds that are boosting their exposure to copper for a multitude of reasons, and while that’s a global trend, a huge amount of that investment has been heading to Comex.

While ASX copper stocks may not be tapped to fill the immediate supply needs, the dynamics at play here tell me they’re well-positioned for the year and potentially years ahead.

Commenting on the unprecedented Comex spread, Jia Zheng, head of trading at Shanghai Dongwu Jiuying Investment Management, said (quoted by Bloomberg), “The short squeeze is set to continue as traders might not be able to ship enough metal from either Chinese bonded warehouses or from Europe ahead of the delivery date.”

This certainly goes a long way toward explaining why BHP Group Ltd (ASX: BHP) is so keen to acquire copper-focused Anglo American (LSE: AAL). If successful, this would see BHP become the largest ASX copper stock and, indeed, the biggest copper producer in the world.

The post What this unprecedented short squeeze signals for ASX copper stocks appeared first on The Motley Fool Australia.

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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 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.