Category: Stock Market

Some ASX growth shares have taken a proper beating over the last couple of years. Rising interest rates, the increased cost of debt, and macroeconomic uncertainty have culminated in reduced investor appetite for risk.

This has sent the market capitalisations of some reputable ASX growth companies plummeting since the heady highs of the post-COVID boom.

But on a positive note, it could mean there are now some cracking buys to be had.

If you’re considering feathering your investment nest with some good eggs this month, check out the following. Because we asked our Foolish writers which ASX growth shares they reckon are worth hopping into in April.

Here is what the team came up with:

7 best ASX growth shares for April 2023 (smallest to largest)

Temple & Webster Group Ltd (ASX: TPW), $429.09 million

Westgold Resources Ltd (ASX: WGX), $615.71 million

Lovisa Holdings Ltd (ASX: LOV) $2.7 billion

Pro Medicus Limited (ASX: PME), $6.75 billion

Xero Limited (ASX: XRO), $13.63 billion

Mineral Resources Ltd (ASX: MIN), $15.57 billion

Aristocrat Leisure Limited (ASX: ALL), $24.72 billion

(Market capitalisations as at market close on 4 April 2023)

Why our Foolish writers love these ASX growth stocks

Temple & Webster Group Ltd

What it does: Temple & Webster describes itself as Australia’s largest pure-play retailer of furniture and homewares. There are more than 200,000 products on the company’s websites, including home improvement products on The Build.

By Tristan Harrison: The Temple & Webster share price has dropped by around 50% over the past year. I think this makes the stock a pretty good value buy right now. Particularly considering the company continues to invest heavily for growth over the long term across areas like technology, customer service, and efficiencies.

Moving forward, I think more and more people will shop online in Australia. In 2021, around 15% to 17% of furniture and homewares sales were transacted through e-commerce, whereas in the United States, it was between 25% to 27%. This suggests a real possibility for major growth of the online furniture market in Australia over the coming years.

Temple & Webster management also expects significant improvement in profit margins as the company grows. In fact, in its FY23 half-year results, Temple & Webster said it expected the company’s earnings before interest, tax, depreciation, and amortisation (EBITDA) margin to rise to at least 15% in the longer term, up from 3.8% in FY22.

Motley Fool contributor Tristan Harrison does not own shares in Temple & Webster Group Ltd.

Westgold Resources Ltd

What it does: Westgold Resources is a small-cap Aussie gold miner and explorer active in the Murchison region of Western Australia. It operates open pit mines, underground mines, and three processing plants in the state.

By Bernd Struben: I believe Westgold Resources is an excellent ASX growth share to take advantage of likely sustained strength in the gold price. Gold has benefitted from rising global uncertainties that are unlikely to subside soon.

Westgold has been battling industry-wide cost pressures that caused a 17% year-on-year cost increase in the first half of FY23. However, the profit outlook looks stronger as the miner has flagged ongoing reductions in production costs in FY24.

Westgold’s Big Bell mine also appears to be an increasingly valuable asset. Recent drilling uncovered high-grade potential exceeding the miner’s pre-feasibility study estimates. Big Bell is also producing beyond forecasts, delivering 8,447 ounces of gold in January and 7,895 ounces in February.

The Westgold share price is up by around 47% in 2023.

As at 31 December, the miner held $144 million in cash.

Motley Fool contributor Bernd Struben does not own shares in Westgold Resources Ltd.

Lovisa Holdings Ltd

What it does: Lovisa is an Aussie-born fashion jewellery retailer with a burgeoning global presence.

By Brooke Cooper: Lovisa doesn’t fit the typical ASX growth-share mould – its share price has gained more than 170% over the last five years, leaving it with a market cap of $2.7 billion.

However, the company has a track record of rolling out new stores around the globe (more than 700 and counting) and plans to keep that momentum going.

That, of course, means costs (and risk) will likely remain high for some time. But looking long term, I think the share could be gearing up for more major gains.

And I’m not alone. Morgans has a $28.50 price target on the stock – representing a potential 11.3% upside at yesterday’s closing price.

Motley Fool contributor Brooke Cooper does not own shares in Lovisa Holdings Ltd.

Pro Medicus Limited

What it does: Pro Medicus provides medical imaging software to hospitals, healthcare organisations, and imaging centres worldwide. The underlying innovation making Pro Medicus stand out from the competition is its cloud-based picture archiving and communication system (PACS) – an industry-first technology when introduced. In simple terms, it allows enormous medical files to be viewed effortlessly by radiologists and clinicians.

By Mitchell Lawler: On initial inspection, this S&P/ASX 200 Index (ASX: XJO) growth share might appear extremely expensive. How could anyone justify a price-to-earnings (P/E) ratio of nearly 135 times? 

The company’s revenue has been growing rapidly, increasing from $34 million in FY18 to $94 million in FY22. During this time, Pro Medicus’ income margin has also expanded from 26.7% to 47.2%. All else being equal, the net margin should continue to grow as Pro Medicus wins more contracts. 

In my opinion, this means the earnings multiple could compress quickly as long as the healthcare company continues to secure additional contracts. Fortunately, the market opportunity is still large for Pro Medicus, with 11 of the top 20 hospitals in the United States yet to use the company’s Visage 7 software. 

Disclosure: Motley Fool contributor Mitchell Lawler owns shares in Pro Medicus Limited.

Xero Limited

What it does: Xero is a provider of online accounting and bookkeeping software. The ASX tech company employs a software-as-a-service (SaaS) model.

By Sebastian Bowen: Xero is an ASX 200 growth share that looks attractive to me in April. This provider of online accounting and bookkeeping software has had a couple of rough years and is now sitting more than 40% off of its all-time high that we saw back in early 2018. 

But I still see a lot of promise in Xero shares. Tax requirements worldwide continue to move towards digital reporting, which gives Xero a powerful tailwind to sit in. 

But this is evident in the company’s numbers as well. Back in November, Xero reported a 13% year-on-year increase in average revenue per user, as well as a 30% rise in revenues and a 16% boost in subscribers. 

So, all in all, I believe Xero is an ASX growth stock worth a deeper dive into this month. 

Motley Fool contributor Sebastian Bowen does not own shares of Xero Limited.

Mineral Resources Ltd

What it does: Mineral Resources is an ASX 200 diversified mining company with four key divisions: iron ore, lithium, energy (gas), and mining services.

By Bronwyn Allen: ASX lithium shares are somewhat out of favour with investors following an amazing run in 2021 and 2022, which coincided with skyrocketing lithium commodity prices.

Today, UBS is warning that supply could double by 2025, with many new lithium mining companies coming to the fore, and Goldman Sachs thinks lithium prices are going to crater. But these predictions are short-term in nature, while the electrification trend is long-term.

Australia is already the world’s largest lithium exporter, and I believe it’s large-scale producers like Mineral Resources that have the advantage over start-ups still building their mines.

The company has a stake in two lithium mines in Western Australia – one in partnership with US lithium giant Albemarle Corporation, the other in partnership with Chinese behemoth Ganfeng Lithium Group.

In the first half of FY23, Mineral Resources brought in $997.2 million in revenue from its lithium operations alone. This was up from $143 million a year earlier and represented 42% of the company’s overall revenue.

I think Mineral Resources is a great lithium play because its assets are located in Australia, and its partners are huge corporations domiciled in two of the world’s biggest lithium markets. I also like that MinRes is diversified across iron ore, gas, and mining services, so it can benefit from the lithium trend without being entirely reliant on it like the ASX pure-play producers. 

Motley Fool contributor Bronwyn Allen does not own shares in Mineral Resources Ltd.

Aristocrat Leisure Limited

What it does: Aristocrat is a gaming technology company with a world-class portfolio of poker machines, mobile games, and real money games.

By James Mickleboro: Although the Aristocrat share price is smashing the market this year, I don’t believe it’s too late to invest. This is due to the company’s attractive valuation and positive long-term growth outlook.

With respect to the former, Aristocrat shares are changing hands for a touch over 18x estimated FY2023 earnings, according to Citi.

As for the latter, with gaming largely recession-proof, Aristocrat continuing to win market share, and its recent expansion into real money gaming, I believe the company is well-placed for growth over the remainder of the 2020s.

Citi appears to agree, and currently has a buy rating and $42.80 price target on Aristocrat shares. It notes that “Aristocrat has also extended its performance gap to peers, coinciding with further market share gains in the premium-leased segment”.

Motley Fool contributor James Mickleboro does not own shares in Aristocrat Leisure Limited.

The post Top ASX growth shares to buy in April 2023 appeared first on The Motley Fool Australia.

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More reading

• Why are ASX 200 lithium shares having such a miserable week?
• ASX 200 rebounds after RBA hits pause on its rate hikes
• Morgans names 3 more of the best ASX 200 shares to buy in April
• Could this further cloud the outlook for ASX 200 lithium shares?
• These are the 10 most shorted ASX shares this week

The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Lovisa, Pro Medicus, Temple & Webster Group, and Xero. The Motley Fool Australia has positions in and has recommended Pro Medicus and Xero. The Motley Fool Australia has recommended Lovisa and Temple & Webster Group. 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 Tuesday, the S&P/ASX 200 Index (ASX: XJO) was on form again and pushed higher. The benchmark index rose 0.2% to 7,236 points.

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

ASX 200 expected to fall

The Australian share market looks set to fall on Wednesday following a poor night on Wall Street. According to the latest SPI futures, the ASX 200 is expected to open the day 12 points or 0.2% lower this morning. On Wall Street, the Dow Jones was down 0.6%, the S&P 500 fell 0.6% and the Nasdaq dropped 0.5%.

Oil prices mixed

ASX 200 energy shares Beach Energy Ltd (ASX: BPT) and Woodside Energy Group Ltd (ASX: WDS) could have a subdued session after a mixed night for oil prices. According to Bloomberg, the WTI crude oil price is up 0.2% to US$80.56 a barrel and the Brent crude oil price has fallen 0.1% to US$84.85 a barrel. Traders appear to believe prices may have peaked after storming higher following OPEC’s production cuts.

Chalice shares are a buy

The Chalice Mining Ltd (ASX: CHN) share price may be nearing a 52-week high but one broker believes it can still rising materially from here. According to a note out of Bell Potter, its analysts have retained their speculative buy rating with an improved price target of $12.00. This implies potential upside of 63% for investors.

Gold price charges higher

Gold miners Evolution Mining Ltd (ASX: EVN) and Northern Star Resources Ltd (ASX: NST) could have a good day after the gold price rose again overnight. According to CNBC, the spot gold price is up 1.9% to US$2,039.2 an ounce. The precious metal stormed higher after treasury yields softened in response to the release of US economic data that was supportive of slower rate hikes.

Dividend payday

A large number of ASX 200 shares will be paying their latest dividends on Wednesday. This includes biotherapeutics company CSL Limited (ASX: CSL), job listings giant Seek Ltd (ASX: SEK), and energy producer Woodside Energy Group Ltd (ASX: WDS).

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

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More reading

• Why are ASX 200 lithium shares having such a miserable week?
• Here are the top 10 ASX 200 shares today
• Here are the 3 most heavily traded ASX 200 shares on Tuesday
• Why did the Flight Centre share price go backwards in March?
• ASX 200 rebounds after RBA hits pause on its rate hikes

Motley Fool contributor James Mickleboro has positions in CSL and Seek. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended CSL. The Motley Fool Australia has recommended Seek. 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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If you’re looking for ASX 200 dividend shares to add to your income portfolio, then it could be a good idea to check out the two listed below.

These ASX dividend shares have been rated as buys by analysts. Here’s what they are saying about them:

Aurizon Holdings Ltd (ASX: AZJ)

The first ASX 200 dividend share that has been tipped as a buy is Aurizon.

It is Australia’s largest rail freight operator. It connects miners, primary producers, and industry with international and domestic markets via its extensive national rail and road network.

Analysts at Morgans are positive on the company due to its current valuation and its “higher quality Network and Coal haulage businesses.”

The broker is expecting the strength of these businesses to underpin growing dividends in the near term. It is forecasting partially franked dividends of 17 cents per share in FY 2023 and then 19 cents per share in FY 2024. Based on the latest Aurizon share price of $3.34, this will mean attractive dividend yields of 5.1% and 5.7%, respectively.

Morgans currently has an add rating and $3.81 price target on its shares.

Rio Tinto Ltd (ASX: RIO)

Another ASX 200 dividend share that has been tipped as a buy is mining giant Rio Tinto.

Goldman Sachs is particularly bullish on the miner due to its “compelling valuation” and favourable iron ore prices. It is also very positive on the company’s medium outlook, noting that it expects to “return to production growth in 2023.”

The broker is expecting this to underpin fully franked dividends per share of US$5.33 in FY 2023 and then US$5.98 in FY 2024. Based on current exchange rates and the latest Rio Tinto share price of $117.74, this will mean yields of 6.7% and 7.5%, respectively.

Goldman Sachs currently has a buy rating and lifting its price target to $140.40.

The post Buy these ASX 200 dividend shares for passive income: analysts appeared first on The Motley Fool Australia.

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More reading

• Why did the Rio Tinto share price lag the ASX 200 today?
• Top ASX dividend shares to buy in April 2023
• Buy these ASX dividend shares next week for passive income: broker
• Rio Tinto share price lifts on copper project news
• Why did the BHP share price have such a top run 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 no position in any of the stocks mentioned. The Motley Fool Australia has recommended Aurizon. 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 Rio Tinto Ltd (ASX: RIO) share price slid into the red on Tuesday.

Rio Tinto shares fell 0.89% to close at $117.74. In contrast, the S&P/ASX 200 Index (ASX: XJO) gained 0.18% amid the RBA hitting the pause button on interest rate rises.

Let’s take a look at what may have weighed on the Rio Tinto share price today.

What happened?

Rio Tinto was not the only ASX 200 mining share to drop today. BHP Group Ltd (ASX: BHP) shares slid 2.19%, while the Fortescue Metals Group Ltd (ASX: FMG) share price slid 0.68%.

A fall in the iron ore price may have impacted Rio Tinto and other ASX 200 iron ore miners.

The iron ore price dropped 2.76% to US$123.50, Trading Economics data shows.

The iron ore price slipped amid fears China could intervene in the market, Reuters reported. China’s National Development and Reform Commission reportedly met with multiple companies in Beijing to discuss the iron ore market. Commenting on the news, senior analyst at multinational financial services company FIS Pei Hao said:

Market sentiment is adversely affected by concerns over [the] government’s cracking down on speculative activities which was triggered by the news.

Iron ore is currently down 2.11% on the Singapore Exchange.

Meanwhile, Rio Tinto today advised it will support Energy Resources of Australia Ltd (ASX: ERA)’s $369 million entitlement offer.

The funds are being raised to fund rehabilitation expenditure for the Ranger Project in the Northern Territory.

Rio owns 86.3% of Energy Resources of Australia shares and will subscribe for its full entitlements under the interim entitlement offer, costing $319 million.

In a statement to the market today, Rio Tinto Australia chief executive Kellie Parker said:

We are committed to ensuring the critical rehabilitation of Ranger is completed to a standard that will establish an environment similar to the adjacent Kakadu National Park.

Rio share price snapshot

The Rio Tinto share price has slipped 2.42% in the last year.

Rio Tinto has a market capitalisation of about $43.7 billion based on the current share price.

The post Why did the Rio Tinto share price lag the ASX 200 today? appeared first on The Motley Fool Australia.

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More reading

• Top ASX dividend shares to buy in April 2023
• Rio Tinto share price lifts on copper project news
• Why did the BHP share price have such a top run today?
• Here’s the Rio Tinto dividend forecast through to 2025
• Want $1,000 of passive income? Check out these ASX shares

Motley Fool contributor Monica O’Shea 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.

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If you’re wanting to invest after the recent market weakness, then exchange traded funds (ETFs) could be a good option if you’re not sure which individual shares to buy.

This is because ETFs allow you to buy multiple (sometimes even thousands) of shares through a single investment.

With that in mind, listed below are two ETFs that could be great options for investors. Here’s what you need to know about them:

BetaShares Global Energy Companies ETF (ASX: FUEL)

The first ETF that investors might want to look at is the BetaShares Global Energy Companies ETF.

As you might have guessed from its name, this ETF provides investors with an easy way to gain exposure to the energy sector.

This is a sector that looks well-placed to benefit from higher oil prices. Particularly after OPEC announced plans to cut production at the weekend.

This production cut would be good news for the companies held by the fund. This includes BP, Chevron, ConocoPhillips, ExxonMobil, Halliburton, Kinder Morgan, Phillips 66, Royal Dutch Shell, and Total.

In addition, BetaShares notes that these companies are larger, more geographically diversified, and more vertically integrated than Australian-listed energy companies.

VanEck Vectors Video Gaming and eSports ETF (ASX: ESPO)

Another ETF for investors to consider in April is the VanEck Vectors Video Gaming and eSports ETF.

This ETF gives investors access to a portfolio of the largest companies involved in video game development, hardware, and esports.

VanEck highlights that this is an industry benefiting from an estimated 2.7 billion+ gamers globally, which is more than active Apple phones and Netflix subscriptions combined.

According to Statista, revenue in the video games segment was projected to reach US$208.60 billion in 2022 and then grow almost 8% per annum through to US$304.70 billion by 2027.

This bodes well for the companies included in the fund such as graphics processing unit developer Nvidia and gaming giants Electronic Arts, Nintendo, Roblox, Take-Two, and Tencent.

The post 2 high quality ETFs for ASX investors in April appeared first on The Motley Fool Australia.

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More reading

• Down over 25% from the peak, can these 2 ASX tech ETFs deliver big returns by 2025?
• 3 excellent ETFs for ASX investors to buy for the long term

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has recommended VanEck Vectors Video Gaming And eSports ETF. 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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If you want to set yourself up for a comfortable retirement, having a passive income stream that is both reliable and has the potential to grow over time would be a great way to achieve this goal.

The good news is that the ASX is home to a number of quality ASX dividend shares that tick these boxes and could be great additions to a retirement portfolio.

Two that are rated as buys are listed below:

Rural Funds Group (ASX: RFF)

The first ASX dividend share to consider for a retirement portfolio is Rural Funds.

It could be a top option due to the quality of the agriculture-focused real estate property trust’s assets and their long term tenancy agreements. The latter also have built-in rental increases, which provides great visibility on its future earnings.

Bell Potter is a fan of Rural Funds and has a buy rating and $2.65 price target on its shares.

As for dividends, it is forecasting dividends per share of 11.7 cents in FY 2023, 12.2 cents in FY 2024, and 12.7 cents in FY 2025 . Based on the current Rural Funds share price of $2.01, this will mean yields of 5.8%, 6.1%, and 6.3%, respectively.

Telstra Corporation Ltd (ASX: TLS)

Retirees may also want to consider buying this telco giant’s shares. It could be a top option due to its defensive qualities, inflation protection, and positive growth outlook.

In addition, now that its legal restructure is complete, the company is able to look at divesting its InfraCo Fixed assets. This could unlock value for shareholders and potentially even lead to capital returns.

It is partly for this reason that Goldman Sachs is bullish on Telstra and has a buy rating and $3.60 price target on its shares.

In addition, the broker is forecasting a growing stream of fully franked dividends. It is expecting dividends per share of 17 cents in FY 2023, 18 cents in FY 2024, and then 20 cents in FY 2025. Based on the current Telstra share price of $4.26, this will mean yields of 4%, 4.2%, and 4.7%, respectively.

The post Add these ASX shares to your retirement portfolio for growing passive income: analysts appeared first on The Motley Fool Australia.

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More reading

• Here are the 3 most heavily traded ASX 200 shares on Tuesday
• These are the best ASX sectors to invest your money into this quarter: Morgans
• ASX 200 rebounds after RBA hits pause on its rate hikes
• Does it make sense to buy Telstra shares at 52-week highs?
• Passive income: How much to invest to get $800 per month

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 Rural Funds Group and Telstra Group. 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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It’s been a bouncy, but overall positive day for the S&P/ASX 200 Index (ASX: XJO) thus far this Tuesday. After a shaky start to trading this morning, the ASX 200 has vaulted back into green territory following the Reserve Bank of Australia’s (RBA) decision to leave interest rates unchanged in April, breaking a ten-month streak of rises.

At the time of writing, the index has lifted by a decent 0.13% to back over 7,230 points.

But let’s now dive deeper into these Tuesday market gyrations by taking stock of the ASX 200 shares that are presently at the peak of today’s share trading volume charts, according to investing.com.

The 3 most traded ASX 200 shares by volume this Tuesday

AGL Energy Limited (ASX: AGL)

Our first ASX 200 share worth a look at today is a company that doesn’t often appear on this list. Energy generator and retailer AGL has had a chunky 20.76 million of its shares bought and sold on the markets thus far. There’s been no news or announcements out of AGL itself for a while. So it seems this high volume is the result of the movements of AGL shares themselves.

This company has indeed had a rather wild session so far this Tuesday. AGL closed at $8.21 a share yesterday but opened at $8.28 this morning before going as high as $8.32. But investors seem to have cooled off on the company, and AGL is now back down to $8.22 a share at present, up 0.18% for the day. This volatility probably explains the high trading volumes we are seeing.

Pilbara Minerals Ltd (ASX: PLS)

Next up is a far more familiar face in ASX 200 lithium share Pilbara Minerals. So far during today’s trading, a meaningful 23.92 million Pilbara shares have been exchanged on the markets. We haven’t seen any news out of Pilbara directly today either. Or indeed this week.

But that hasn’t stopped this company from having an even wilder trading day than AGL. Pilbara has had a few stints in both positive and negative territory today. But investors have taken a turn for the worse over the afternoon, with Pilbara now down a nasty 2.6% at $3.70 a share. That’s despite the company climbing as high as $3.84 earlier this morning.

Again, it looks like it’s this volatility that we have to thank for Pilbara’s trading volumes this Tuesday.

Telstra Group Ltd (ASX: TLS)

Last but certainly not least when it comes to trading volumes, we have ASX 200 telco Telstra. A large 24.96 million Telstra shares have changed hands on the markets as it currently stands. Telstra is having a top run so far this session and has even set a new 52-week high.

This afternoon, the telco hit $4.27 a share, which is the highest level Telstra has traded at since 2017. Right now, the shares are up a solid 1.07% at $4.26. It’s this strong rise, as well as the new 52-week high, that probably explains why this telco is topping our list this Tuesday.

The post Here are the 3 most heavily traded ASX 200 shares on Tuesday appeared first on The Motley Fool Australia.

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More reading

• Add these ASX shares to your retirement portfolio for growing passive income: analysts
• These are the best ASX sectors to invest your money into this quarter: Morgans
• Why did the Flight Centre share price go backwards in March?
• ASX 200 rebounds after RBA hits pause on its rate hikes
• Does it make sense to buy Telstra shares at 52-week highs?

Motley Fool contributor Sebastian Bowen has positions in Telstra Group. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has positions in and has recommended Telstra Group. 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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If you’re not sure where to invest in the current environment, you’re not alone. The banks were the place to be just a couple of months ago, but all that changed last month.

It has been a similar story for ASX energy shares and lithium shares, which are seemingly in and out of favour with the market on a regular basis.

So where should ASX investors turn to now?

The team at Morgans has been busy figuring out which sectors are more likely to outperform in the second quarter of 2023.

In respect to financials, the broker believes that recent banking jitters have created an opportunity for investors. It said:

There are reasons for cautious optimism and a major banking crisis looks unlikely. Unlike in 2007, there do not appear to be large credit losses hidden in opaque instruments on bank balance sheets. Post-GFC reforms mean that large global banks have more robust capital and liquidity buffers.

However, the broker believes that diversified financials are the better option right now, with GQG Partners Inc (ASX: GQG) and QBE Insurance Group Ltd (ASX: QBE) its top picks. It commented:

We continue to see the sector trading at reasonable multiples, offering a good hedge against inflation, and having defensive properties as we potentially head into a slower global economy.

In addition, the broker believes the healthcare sector is a great place for investors to be right now thanks to long-term tailwinds. It explained:

The long-term demand drivers like an increase in complex and chronic conditions will underpin earnings growth. Although the sector is not immune to cost pressures in many instances price increases for services have been pushed through.

Moving on, the sector the broker rates the highest right now is the energy sector, with Santos Ltd (ASX: STO) and Karoon Energy Ltd (ASX: KAR) the broker’s top picks. Morgans explained:

The warm northern winter and recession fears have driven the recent energy correction. However, these events don’t solve for structural supply challenges, which we think can see energy prices again ratchet higher in late 2023.

Finally, the telco sector is high up on the broker’s list right now, with NextDC Ltd (ASX: NXT) and Telstra Group Ltd (ASX: TLS) getting the thumbs up. It said:

Demand for quality secure digital infrastructure remains robust and sector tailwinds look likely to delivering shareholder returns.

All in all, Morgans believes there are plenty of opportunities out there for investors, which bodes well for portfolios this quarter.

The post These are the best ASX sectors to invest your money into this quarter: Morgans appeared first on The Motley Fool Australia.

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More reading

• ASX 200 rebounds after RBA hits pause on its rate hikes
• Morgans names 3 more of the best ASX 200 shares to buy in April
• Does it make sense to buy Telstra shares at 52-week highs?
• Passive income: How much to invest to get $800 per month
• ‘Strong demand’: The 2 ASX 200 shares to pounce on right now

Motley Fool contributor James Mickleboro has positions in Nextdc. 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 Telstra Group. 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 Flight Centre Travel Group Ltd (ASX: FLT) share price lost momentum in March, closing the month 1.7% lower than it started. After closing February at $18.80, the stock slumped to end March at $18.48.

For comparison, the S&P/ASX 200 Index (ASX: XJO) fell 1.1% last month.

So, what went on at the ASX 200 travel share over the period? Let’s take a look.

Flight Centre completes capital raising in March

After starting 2023 with two months of ripper gains, the Flight Centre share price stalled in March.

Interestingly, there was no price-sensitive news from the travel giant last month. Though, it did complete what became a $240 million capital raise.

The company launched a share purchase plan (SPP) to help fund its acquisition of luxury travel brand Scott Dunn in February. The SPP was originally intended to raise $40 million.

However, after receiving applications for more than $350 million worth of new shares – offered at $14.60 apiece – the company bolstered the raise to $60 million.

Flight Centre founder and managing director Graham Turner commented on the demand, thanking shareholders for their support and saying:

By increasing the SPP offer to $60 million, we have provided our shareholders with the opportunity to secure a more meaningful stake in their company with a view to benefitting to a larger degree as its post-COVID recovery gains momentum.

But not all were as bullish on the Flight Centre share price as the 19,304 shareholders who applied for the SPP assumably were.

The ASX 200 stock remained the market’s most shorted last month. The company had a short interest of nearly 12% at last count.

It’s worth mentioning, however, that’s notably lower than its peak short interest in April 2022 when more than 18% of its shares were being shorted.

Flight Centre share price snapshot

March was a disappointing month for the Flight Centre share price. But the stock has outperformed over the longer term.

It’s gained 32% since the start of 2023. Though, it’s 2% lower than it was this time last year.

Comparatively, the ASX 200 has lifted 4% year to date and has fallen 4% over the last 12 months.

The post Why did the Flight Centre share price go backwards in March? appeared first on The Motley Fool Australia.

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More reading

• ASX 200 rebounds after RBA hits pause on its rate hikes
• The ASX 200 is down 5% since February. Time to pounce for passive income?
• Why did the Fortescue share price smash the ASX 200 in March?
• 5 things to watch on the ASX 200 on Tuesday
• Here are the 3 most heavily traded ASX 200 shares on Monday

Motley Fool contributor Brooke Cooper has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Flight Centre Travel Group. 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 S&P/ASX 200 Index (ASX: XJO) has rebounded this afternoon after the Reserve Bank of Australia (RBA) announced its cash rate decision.

Shortly after the decision, the ASX 200 index is up 0.15% to 7,234.4 points.

RBA hits pause

According to the release, much to the delight of borrowers, the central bank has elected to pause its hikes and has kept the cash rate at 3.6%.

This shouldn’t come as surprise to the market. In fact, the ASX 30 Day Interbank Cash Rate Futures for April 2023 indicated that the market was pricing in a 100% probability that rates would not change at today’s meeting. That’s as sure as sure can be!

What did the RBA say?

The RBA explained that it was hitting pause because it wants to wait and see what impact recent hikes will have on the economy and inflation. Governor Philip Lowe commented:

At its meeting today, the Board decided to leave the cash rate target unchanged at 3.60 per cent and the interest rate on Exchange Settlement balances unchanged at 3.50 per cent. This decision follows a cumulative increase in interest rates of 3½ percentage points since May last year.

The Board recognises that monetary policy operates with a lag and that the full effect of this substantial increase in interest rates is yet to be felt. The Board took the decision to hold interest rates steady this month to provide additional time to assess the impact of the increase in interest rates to date and the economic outlook.

But that doesn’t mean that the rate hike cycle is over. The RBA concluded by stating that it believes further increases to the cash rate may be required in the future to tame inflation. It concludes:

The Board expects that some further tightening of monetary policy may well be needed to ensure that inflation returns to target. The decision to hold interest rates steady this month provides the Board with more time to assess the state of the economy and the outlook, in an environment of considerable uncertainty.

In assessing when and how much further interest rates need to increase, the Board will be paying close attention to developments in the global economy, trends in household spending and the outlook for inflation and the labour market. The Board remains resolute in its determination to return inflation to target and will do what is necessary to achieve that.

How are ASX 200 shares reacting?

It has largely been business as usual for ASX 200 shares since the RBA’s announcement. Here’s a summary of how some notable shares are faring:

• The Commonwealth Bank of Australia (ASX: CBA) share price has recovered from a 0.5% decline to be flat.
• The BHP Group Ltd (ASX: BHP) share price is still down almost 2% to $46.14.
• The Telstra Group Ltd (ASX: TLS) share price remains up 1% to $4.26.
• The Xero Limited (ASX: XRO) share price continues has climbed slightly since the decision to be up 1.5% to $92.04.

The post ASX 200 rebounds after RBA hits pause on its rate hikes appeared first on The Motley Fool Australia.

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More reading

• Morgans names 3 more of the best ASX 200 shares to buy in April
• Does it make sense to buy Telstra shares at 52-week highs?
• Passive income: How much to invest to get $800 per month
• The ASX 200 is down 5% since February. Time to pounce for passive income?
• Why did the Fortescue share price smash the ASX 200 in March?

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.

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