Category: Stock Market

Investors are understandably wary of ASX shares involved in the retail sector, for good reasons.

The negative effect of seven consecutive interest rate rises will soon start to bite Australian households, as there is often a lag after rate rises before consumers start closing their wallets.

And if Australians have less disposable income, they’re not going to get out to the shops and go nuts on buying non-staple items.

However, there are some exceptions.

Due to the nature of their operating model or the actual product or service they provide, some retail businesses are more resistant to economic downturns.

Here are two such examples of ASX shares experts rated as buys this week:

Riding the recent stock price momentum

For Sequoia Wealth Management senior wealth manager Peter Day, Super Retail Group Ltd (ASX: SUL) ticks many boxes.

“Company brands include Supercheap Auto, rebel, BCF and Macpac. The latest trading update showed a positive start in the first 16 weeks of fiscal year 2023.”

Management was understandably conservative in its outlook in the current environment, but Day is more bullish than that.

“We remain positive about the company’s resilience. Share price momentum has been to the upside between early October and November 3.”

Indeed the Super Retail share price has soared almost 16% since 3 October. Helping Day’s buy case is a tidy 7% dividend yield.

While the stock is a buy for the team at Sequoia, other professionals aren’t wholly convinced.

According to CMC Markets, eight out of 16 analysts currently rate Super Retail as a hold. Six recommend it as a strong buy.

Shares going for an attractive discount

Spotee Connect chief Chris Batchelor reckons JB Hi-Fi Limited (ASX: JBH) operates “a successful business” in consumer electronics retail.

The share price has admittedly dipped 11% year to date, but he’s convinced that’s merely a buying opportunity for long-term investment.

“Revenue has increased at a compound average annual rate of 11.4% for the past 10 years.”

Despite the economic worries, the discount in the valuation is making JB Hi-Fi a compelling buy.

“The market is concerned about economic headwinds dampening consumer demand — but we believe a share price at low $40 levels represents good value.”

JB Hi-Fi shares closed Tuesday at $43.33.

The post What recession? 2 retail ASX shares ready to bust out: expert appeared first on The Motley Fool Australia.

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More reading

• These are the ASX 200 dividend shares to buy: analysts
• Amazon stock just tanked. Could this be a canary in the coal mine for ASX 200 retail shares?
• Brokers name 3 ASX shares to buy today
• Batten down the hatches as RBA may hit households with ‘supersized’ interest rate hike on Melbourne Cup day
• 3 ASX 200 shares rising after Q1 trading updates

Motley Fool contributor Tony Yoo 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 Super Retail Group Limited. The Motley Fool Australia has positions in and has recommended Super Retail Group Limited. The Motley Fool Australia has recommended JB Hi-Fi Limited. 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) pushed higher again and recorded a modest gain. The benchmark index rose 0.35% to 6,958.9 points.

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

ASX 200 expected to rise

The Australian share market looks set to rise on Wednesday despite a mixed night on Wall Street. According to the latest SPI futures, the ASX 200 is expected to open the day 19 points or 0.3% higher this morning. In late trade on Wall Street, the Dow Jones is up 0.5%, the S&P 500 is down 0.1%, and the Nasdaq is down 0.35%.

Oil prices drop

Energy shares Beach Energy Ltd (ASX: BPT) and Woodside Energy Group Ltd (ASX: WDS) could have a difficult day after oil prices dropped overnight. According to Bloomberg, the WTI crude oil price is down 2.5% to US$89.47 a barrel and the Brent crude oil price has fallen 2.1% to US$95.85 a barrel. Chinese demand concerns weighed on prices.

NAB results

The National Australia Bank Ltd (ASX: NAB) share price will be on watch today when the banking giant releases its full year results. According to a note out of Goldman Sachs, its analysts are expecting NAB to report cash earnings of $7,215 million. This represents a 10% increase year over year. A final dividend of 77 cents per share is expected to be declared.

Gold price rises

Gold miners Evolution Mining Ltd (ASX: EVN) and Northern Star Resources Ltd (ASX: NST) could have a good day after the gold price pushed higher overnight. According to CNBC, the spot gold price is up 2.1% to US$1,716.3 an ounce. Gold rose thanks to softness in the US dollar.

AGMs being held

A number of ASX 200 shares are holding their annual general meetings today and could provide the market with updates on their performance. This includes supermarket operator Coles Group Ltd (ASX: COL), property listings company Domain Holdings Australia Ltd  (ASX: DHG), and gold miner Newcrest Mining Ltd (ASX: NCM).

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

• Here are the top 10 ASX 200 shares today  
• Here are the 3 most traded ASX 200 shares on Tuesday
• These 10 predictions could help you profit from the stock market regardless of inflation, interest rates or even another bear market
• Why did the Woodside share price just hit an 8-year high?
• Guess which ASX 200 director sold $6.5m worth of their company shares last week

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 COLESGROUP DEF SET. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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Exchange traded funds (ETFs) can be great additions to a balanced portfolio.

This is because they provide investors with easy access to a large and diverse number of different shares.

But which ones would be top options for investors in November? Listed below are three that could be worth considering:

BetaShares NASDAQ 100 ETF (ASX: NDQ)

The first ETF for investors to consider is the popular BetaShares NASDAQ 100 ETF. This ETF gives investors exposure to many of the largest companies in the world. This includes the likes of Amazon, Apple, Microsoft, Netflix, and Tesla. The operator of the ETF, BetaShares, notes that with its strong focus on technology, the ETF provides investors with diversified exposure to a high-growth potential sector that is under-represented on the ASX.

iShares S&P 500 ETF (ASX: IVV)

Another ETF to consider is the iShares S&P 500 ETF. This ETF gives investors access to 500 of the top listed U.S. companies through a single investment. This means that you’ll be buying a diverse group of companies such as Amazon, Apple, Disney, Facebook, JP Morgan, Johnson & Johnson, Microsoft, Tesla, and Visa.

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

A final ETF for ASX investors to consider in November is the VanEck Vectors Video Gaming and eSports ETF. This ETF gives investors access to a portfolio of companies involved in video game development, hardware, and esports. These include Activision Blizzard, AMD, Electronic Arts, Nintendo, Nvidia, Roblox, and Take-Two. The ETF’s operator, VanEck, points out that these companies are well-placed to benefit from the increasing popularity of video games and eSports.

The post 3 ETFs for ASX investors to buy right now appeared first on The Motley Fool Australia.

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More reading

• 2 of the best ETFs for ASX investors to buy next week
• Why is the BetaShares Nasdaq 100 ETF taking a thrashing today?
• 2 high quality ETFs for ASX investors in November
• 2 excellent ETFs to buy for portfolio diversification
• Here are 3 ASX ETFs for smart investors

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 BETANASDAQ ETF UNITS. The Motley Fool Australia has positions in and has recommended BETANASDAQ ETF UNITS. The Motley Fool Australia has recommended VanEck Vectors ETF Trust – VanEck Vectors Video Gaming and eSports ETF and iShares Trust – iShares Core S&P 500 ETF. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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ASX lithium shares had a top run on the market on Tuesday.

Core Lithium Ltd (ASX: CXO) shares rose 3.79%, while Pilbara Minerals Ltd (ASX: PLS) shares leapt 4.42%.

Meanwhile, Sayona Mining Ltd (ASX: SYA) shares jumped 2.08% and Allkem Ltd (ASX: AKE) shares leapt 3.34%. For perspective, the S&P/ASX 200 Index (ASX: XJO) climbed 0.36% today.

Let’s take a look at why ASX lithium shares fared well today.

A ‘tighter’ lithium market

Lithium shares charged higher today amid a broker upgrade on the lithium price.

Macquarie is tipping spot lithium prices to peak at US$6,500 per tonne, the Australian Financial Review reported. Analysts said:

We believe the theme of supply security could result in lithium trading and processing reshuffles, leading to an even tighter market.

Spot lithium prices have remained buoyant.

Core Lithium and Pilbara Minerals were among the top ASX 200 shares traded by volume today.

Bell Potter has recently maintained a buy rating on the Allkem share price with a $19.45 price target. This suggests a 26% upside. Bell Potter said:

AKE is aiming to maintain 10% share of supply in a global lithium market experiencing unprecedented growth; it has a portfolio of growth projects, balance sheet strength and cash flow from existing projects to achieve this.

As my Foolish colleague Bronwyn recently reported, Argo Investments Limited (ASX: ARG) are tipping global electric vehicle (EV) sales to jump from six million in 2022 to 30 million in 2030.

Meanwhile, the Federal Government tips spodumene prices to hit US$3,280 in 2023 before easing to US$2,490 a tonne in 2024. Lithium hydroxide prices are forecast to rise to US$51,510 in 2023 before dropping back to US$37,650 in 2024.

The post Why did ASX lithium shares smash the market on Tuesday? appeared first on The Motley Fool Australia.

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More reading

• Why did the Pilbara Minerals share price have such a cracker day?
• Here are the top 10 ASX 200 shares today  
• Here are the 3 most traded ASX 200 shares on Tuesday
• Why is the Core Lithium share price spiking 3% today?
• Is the Allkem share price a buy ahead of next week’s AGM?

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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The Pilbara Minerals Ltd (ASX: PLS) share price was one of the strongest performers today, rising by 4.42%. Considering the S&P/ASX 200 Index (ASX: XJO) only went up by 0.36% during today’s trading, it was a good performance by the ASX lithium share.

It has been a very good year for the company. In the past six months, the share price has more than doubled.

Other ASX lithium shares also saw positive movements in their share prices today, including Core Lithium Ltd (ASX: CXO) and Mineral Resources Limited (ASX: MIN).

What caused the pleasing gain?

According to reporting by the Australian Financial Review, the broker Macquarie has increased its expectations for the lithium price again.

Even though there are near-term economic headwinds in China, including ongoing lockdowns, Macquarie decided to increase the Chinese and regional lithium price forecast, and the peak price for spodumene (lithium).

The reason for this increase was to include the latest changes in supply and demand fundamentals, as well as movements in spot prices.

Macquarie wrote:

We believe the theme of supply security could result in lithium trading and processing reshuffles, leading to an even tighter market.

Spot lithium prices have remained buoyant; we now expect spodumene prices to peak at US$6,500 per tonne.

Pilbara Minerals is already experiencing strong pricing

Investors have already been hearing throughout 2022 that the lithium price has been climbing.

Approximately a year ago, on 26 October 2021, the lithium miner announced that it had sold a cargo of 10,000 dry metric tonnes at a target grade of 5.5% lithia, via the Battery Material Exchange (BMX).

It said there was strong interest at that auction in both participation and bidding by a broad range of buyers. Pilbara Minerals sold to the highest bidder for a price of US$2,350 per dmt. This equated to a price of US$2,629 when accounting for the lithia content and including freight costs.

A few weeks ago, the ASX lithium share announced it had sold a cargo of 5,000 dmt for US$7,255 per dmt. This equated to an equivalent of approximately US$8,000 per dmt when adjusting for lithia content and including freight costs.

While Pilbara Minerals is only selling relatively small amounts of production at these high levels, we can see that it is achieving very strong prices.

Snapshot

Over the past month, the Pilbara Minerals share price has managed to climb another 4%, despite the volatility. It is up 54% this year to date.

The post Why did the Pilbara Minerals share price have such a cracker day? appeared first on The Motley Fool Australia.

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More reading

• Here are the top 10 ASX 200 shares today  
• Here are the 3 most traded ASX 200 shares on Tuesday
• Here are the 3 most heavily traded ASX 200 shares on Monday
• With a forward P/E ratio of 8, is the Pilbara Minerals share price actually cheap?
• Here are the 3 most traded ASX 200 shares on Friday

Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Macquarie Group Limited. 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 US markets have been on a bit of a tear over the past month or so. Since 12 October, the S&P 500 Index (SP: .INX) has gained more than 6% – not a bad return for under a month. Saying that, the S&P 500 remains down a depressing 20% or so over the year to date. So things haven’t been too rosy over stateside.

But perhaps the US markets could be set for a major boost this week.

The Americans are about to hold their midterm elections. No, president Joe Biden isn’t up for reelection just yet. His term expires in January 2025, with the next presidential election to be held in November 2024.

But under the American political system, all members of the lower house, the House of Representatives, are up for re-election every two years. As are a third of the Senate. And these midterm elections are scheduled for this week.

At the moment, the president’s Democratic Party controls both chambers of congress by slim margins. But control of one or both Houses could well change this week. This would deliver what is known as ‘divided government’.

For a law to pass in the US, it must pass through both houses of congress, and be approved by the president. As such, it is harder to pass laws when control of congress is divided between the parties.

Divided government could help boost the US stock market

According to reporting in Reuters, the opposition Republican Party looks likely to gain control of at least the House, and possibly the Senate. As such, it looks as though the US is heading towards divided government. This, according to the report, would be seen as a positive for markets:

A split government could result in political gridlock that stymies major policy changes, an outcome that investors see as favorable for equities.

Regardless of the winner, past midterm elections have ushered in a period of positive market performance, something investors would welcome after a year in which the S&P 500 has declined by nearly 21%.

Divided government could also lead to a renewed push for increased US energy production. As well as higher defence spending and changes to healthcare and pharmaceutical laws or regulations.

It would also likely move the US away from the possibility of federal cannabis legalisation, which has historically weighed down the domestic cannabis industry in the US.

But overall, it seems that divided government would be a positive tailwind for the US markets, and possibly by extension, the S&P/ASX 200 Index (ASX: XJO).

Remember, the ASX is heavily influenced by what happens across the Pacific. So keep your eye on America this week as the outcome of the midterm elections becomes clear. It could well have an impact on the US stock market and our own.

The post Could the US stock market be set for a major boost? appeared first on The Motley Fool Australia.

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More reading

• Why did the Pilbara Minerals share price have such a cracker day?
• Here are the top 10 ASX 200 shares today  
• Looking to buy CBA shares? Here’s the latest on the bank’s class action
• Happy deal: The ASX tech share rocketing 46% on a McDonald’s agreement
• Bendigo Bank share price climbs as chair slams ANZ-Suncorp deal as ‘sub-optimal’

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 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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The S&P/ASX 200 Index (ASX: XJO) posted a third consecutive gain on Tuesday. The index closed 0.36% higher at 6,958.9 points.

The United States’ mid-term elections were the talk of the town today as they kicked off. Some experts predict Wall Street could rejoice if the US Republican Party takes power in either the senate or the house, thereby potentially limiting sweeping legislative changes.

Meanwhile, back home, the S&P/ASX 200 Utilities Index (ASX: XUJ) led the way, gaining 1.4%.

The S&P/ASX 200 Financials Index (ASX: XFJ) and the S&P/ASX 200 Consumer Staples Index (ASX: XSJ) also outperformed, lifting 1% and 1.3% respectively.

It wasn’t such a great day for the S&P/ASX 200 Energy Index (ASX: XEJ), though. It fell 2.3% amid easing oil prices.

The Brent crude oil price dropped 0.7% to US$97.92 a barrel overnight, while the US Nymex crude oil price slipped 0.9% to US$91.79 a barrel.

The S&P/ASX 200 Materials Index (ASX: XMJ) also dropped 0.3% on Tuesday.

All in all, nine of the ASX 200’s 11 sectors closed higher. But which share outperformed all others? Keep reading to find out.

Top 10 ASX 200 shares countdown

Today’s top-performing ASX 200 stock was Mineral Resources Limited (ASX: MIN). It posted a near-5% gain despite no news having been released by the diversified mining company.

Today’s biggest gains were made by these shares:

ASX-listed company	Share price	Price change
Mineral Resources Limited (ASX: MIN)	$79.11	4.95%
Pilbara Minerals Ltd (ASX: PLS)	$5.43	4.42%
A2 Milk Company Ltd (ASX: A2M)	$5.73	3.99%
Lottery Corporation Ltd (ASX: TLC)	$4.47	3.95%
Core Lithium Ltd (ASX: CXO)	$1.505	3.79%
Allkem Ltd (ASX: AKE)	$15.46	3.34%
Block Inc (ASX: SQ2)	$97.21	2.82%
Tabcorp Holdings Ltd (ASX: TAH)	$0.975	2.63%
IGO Ltd (ASX: IGO)	$15.67	2.49%
Nickel Industries Ltd (ASX: NIC)	$0.83	2.47%

Our top 10 shares countdown is a recurring end-of-day summary to let you know which companies were making big moves on the day. Check in at Fool.com.au after the weekday market closes to see which stocks make the countdown.

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

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More reading

• Here are the 3 most traded ASX 200 shares on Tuesday
• Why A2 Milk, Cettire, Lottery Corp, and Weebit Nano shares are rising
• Why is the A2 Milk share price surging 5% on Tuesday?
• Why is the Core Lithium share price spiking 3% today?
• Guess which ASX 200 director sold $6.5m worth of their company shares last week

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 positions in and has recommended Block, Inc. The Motley Fool Australia has positions in and has recommended Block, Inc. The Motley Fool Australia has recommended A2 Milk. 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 Commonwealth Bank of Australia (ASX: CBA) share price closed higher today despite the company being accused of “law-breaking on a grand scale” in a class action lawsuit brought against it.

Shares of the big-four bank ended the day up 1.36% at $104.48 each.

CBA’s share price performance might have been helped by the fact the S&P/ASX 200 Financials Index (ASX: XFJ) was also up for the day, by 1.02%.

Let’s cover the highlights of the class action lawsuit against the ASX bank share.

The lawsuit

The Age reported that Maurice Blackburn and Phi Finney McDonald are suing CBA on behalf of affected shareholders after the bank agreed to pay a $700 million fine to settle a case with financial intelligence agency AUSTRAC in 2017.

The article notes the CBA share price dropped more than 5% amid AUSTRAC announcing it would pursue the bank for allegedly breaching money laundering laws, which saw criminals launder money through its ATMs.

The lawsuit claims CBA knew about these cash deposits being made at its ATMs but did not report them to the agency, nor the ASX, thus allegedly breaching its continuous disclosure obligations and consequently destroying shareholder value amid its share price dropping lower.

Meanwhile, the CBA is denying these claims, stating that it did not need to disclose these developments to the market as they were not price-sensitive.

A spokesperson for the bank said CBA vigorously denies the allegations and is defending the actions.

What happened this week

The first hearing for the case was held on Monday, with Maurice Blackburn’s lawyer Jeremy Stoljar stating that CBA broke the Anti-Money Laundering and Counter-Terrorism Financing Act a massive number of times over three years.

Stoljar said:

The issue is, is this information of the kind that would or would be likely to influence investment decisions? Well, of course it would. Look at the sheer number of contraventions: 53,506 contraventions is, objectively, a very large number to say the least. It’s law-breaking on a grand scale.

Stoljar continued:

It had continued for a long period of time indicating ongoing and systemic failing. It increased the cost of doing business involving remediation, persistent costs and potentially civil penalties.

Stoljar then showed the court an email chain of CBA executives stating that the breach needed to be taken “extremely seriously”, and that its chief risk officer should be in contact with AUSTRAC to inform the agency of its breaches.

“This is absolutely at odds with the case CBA tries to put, which is that it’s not material,” Stoljar said.

The case continues. It is scheduled to last six weeks in Federal court.

The post Looking to buy CBA shares? Here’s the latest on the bank’s class action appeared first on The Motley Fool Australia.

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More reading

• Are ASX 200 bank shares a no-brainer buy in an inflationary environment?
• Why Morgans added CBA shares to its best ideas list
• Is Bendigo Bank the best bet for dividends out of all the ASX 200 bank shares?
• The CBA share price has soared 17% in a month. Is it time to cash in?
• The CBA share price soared 15% in October

Motley Fool contributor Matthew Farley 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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The Skyfii Limited (ASX: SKF) share price is exploding today amid an agreement with McDonald’s Corp (NYSE: MCD).

Skyfii shares are soaring 45.71% at the time of writing and currently trading at 5.1 cents. For perspective, the S&P/ASX 200 Index (ASX: XJO) is climbing 0.4% today.

Let’s take a look at why this ASX tech share is rocketing ahead today.

McDonald’s deal

Skyfii has signed a deal with McDonald’s to supply technology at eight restaurants in the United States.

The three-year contract has a total contract value of $2 million.

Skyfii will provide the fast food chain with real-time restaurant monitoring and analysis technology. This is an industry first, according to Skyfii.

The data from the technology will enable McDonald’s to find out how long it takes for a customer to receive their order. Skyfii has partnered with global strategy and research company Halverson Group on this solution.

Commenting on the news, Skyfii CEO Wayne Arthur said:

The opportunity to partner with both Halverson Group and McDonald’s to create an industry-first solution that solves some critical pain points for such a large and
globally recognised QSR brand is a privilege

What else?

Skyfii also delivered an investor presentation to the market today. Total operating revenue lifted 7% on the prior corresponding period to $5.4 million. Net operating cash flow improved 333% to -$0.9 million.

Skyfii said 75% of its new contract wins are outside the APAC region. Of the deals closed, 79% have been in the last six months.

Looking ahead, the company is expecting to deliver another year of “strong revenue growth”.

Skyfii share price snapshot

The Skyfii share price has fallen 46% in the past year, while it has lost 48% in the year to date.

For perspective, the ASX 200 has fallen nearly 7% in a year.

This ASX tech share has a market capitalisation of about $21 billion based on the current share price.

The post Happy deal: The ASX tech share rocketing 46% on a McDonald’s agreement appeared first on The Motley Fool Australia.

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• Here’s how I allocate my ASX share portfolio and why

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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The Bendigo and Adelaide Bank Ltd (ASX: BEN) share price is currently edging higher, up 1.47% to $8.95.

This comes as one of the company’s leadership commented on the deal between Australia and New Zealand Banking Group Ltd (ASX: ANZ) and Suncorp Group Ltd (ASX: SUN).

ANZ wants to buy the banking division of Suncorp for $4.9 billion.

For ANZ, it’s trying to beef up its business so that it can better compete with its rivals Commonwealth Bank of Australia (ASX: CBA), Westpac Banking Corp (ASX: WBC) and National Australia Bank Ltd (ASX: NAB).

For Suncorp, it will enable the company to focus on its insurance operations.

Bendigo Bank’s view on the deal

The Bendigo Bank share price is rising amid the company holding its annual general meeting (AGM) today.

Chair Jacqueline Hey noted that the business is firmly focused on its organic growth strategy, though it does “from time to time” consider mergers and acquisitions that “will create value for shareholders and customers”.

Hey said:

Whilst we do not comment on these type of activities in the normal course of business, given this one is public we do believe it’s important our shareholders are fully aware that Suncorp avoided engagement with our bank – despite repeated approaches – and instead announced a transaction with a big four bank. We believe this will only further entrench Australia’s banking oligopoly and provide sub-optimal outcomes for customers and communities.

Deal requires government approval

A deal this size between two S&P/ASX 200 Index (ASX: XJO) shares requires government approval.

The Queensland government is taking a close interest in the deal because of how important Suncorp is for the local economy.

While there are reports the Queensland Treasurer isn’t opposed to the transaction, there was criticism from other sources.

The Australian Financial Review quoted the Finance Sector Union Queensland secretary Wendy Streets, who said:

There are currently around 40 suburbs [or] towns where there are both Suncorp and ANZ branches and we believe these ANZ’s will be targeted to close during the three-year moratorium.

At the conclusion of the three-year commitment, it is our view that the savings will come from back office synergies between the two which ultimately will mean a significant amount of Queensland job losses as the work transfers to ANZ Melbourne departments.

Other highlights from the Bendigo Bank AGM

The Bendigo Bank CEO and managing director Marnie Baker noted that the current economic outlook remains complex, challenging, and “in flux”.

Cash rates are starting to impact property values and the regional bank is expecting credit growth to moderate, while competition remains intense.

With that in mind, the bank will continue to focus on managing its costs, strengthening returns, future-proofing the business and improving its overall returns.

Bendigo Bank share price snapshot

Over the last month, Bendigo Bank shares have risen by close to 10%.

However, they are down almost 14% in the past six months and 4% year to date.

The post Bendigo Bank share price climbs as chair slams ANZ-Suncorp deal as ‘sub-optimal’ appeared first on The Motley Fool Australia.

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More reading

• Are storm clouds gathering over ANZ’s Suncorp bid?
• Analysts say these ASX dividend shares are buys this week
• ‘Undemanding’ valuation: Morgans tip 17% upside for the Suncorp share price
• Are ASX 200 bank shares a no-brainer buy in an inflationary environment?
• Why ANZ, Coronado Global, Eclipx, and Westpac shares are dropping

Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has positions in and has recommended Bendigo and Adelaide Bank Limited. The Motley Fool Australia has recommended Westpac Banking Corporation. 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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