Category: Stock Market

A message from our CIO, Scott Phillips:

“G’day Fools. If you’re like us, you’re dismayed by the events taking place in Ukraine. It is an unnecessary humanitarian tragedy. Times like these remind us that money is important, but other things are far more valuable. And yet the financial markets remain open, shares are trading, and our readers and members are looking to us for guidance. So, we’ll do our best to continue to serve you, while also hoping for a swift and peaceful end to war in Ukraine.”

—————

The IGO Ltd (ASX: IGO) share price may be surging ahead lately, but one broker thinks it can go even higher.

The company’s shares are currently swapping hands at $12.76, down 1.85% today. However, that’s still a 17% since the close of trading on February 28. In contrast, the S&P/ASX 200 Index (ASX: XJO) is down 0.8% during that same time frame.

However, one broker believes there is still more to come from the nickel miner. Let’s take a look.

Price target lifts

Analysts at Citi have lifted the IGO share price target, a NAB report reveals. The broker has upgraded the company’s price target to $14. That suggests an upside of almost 10% on the current price.

The broker reportedly sees IGO making “hefty margins of 90%” in the first half of FY22.

Nickel prices surged 90% to hit all-time highs in global markets overnight amid supply concerns as a result of Russia’s invasion of Ukraine. Russia provides about 10% of the world’s nickel.

As Motley Fool Australia reported earlier, investors are fearing western sanctions against Russia could disrupt air and sea shipments of the commodity.

Citi predicts nickel prices to rally to US$30,000/tonne in quarter two of FY22, before moderating in quarter three.

IGO owns and operates the Nova nickel, copper, and cobalt mining operation in Western Australia.

Today, IGO updated the market with a copy of a presentation to the Euroz Hartleys Conference. The company stated it can gain leverage from the disruptive transition to clean energy. IGO highlighted its portfolio of “high-quality assets” with exposure to nickel, copper, cobalt, and lithium.

IGO share price snapshot

The IGO share price has soared nearly 100% in the past year and is up 11% year to date.

In the past month, the miner’s shares have gained 6%, while they have risen 17% in the past week.

For perspective, the benchmark ASX 200 index has returned around 4% over the past year.

The post Up 17% this month, why the IGO (ASX:IGO) share price can keep gaining: broker appeared first on The Motley Fool Australia.

More reading

• The price of nickel is soaring and these ASX mining shares are cashing in
• Why IGO, Lake Resources, Talga, and Whitehaven Coal shares are charging higher
• ASX 200 (ASX:XJO) midday update: Corp Travel Management’s ACCC boost, Zip downgraded
• Why IDP, IGO, Sayona Mining, and Yancoal shares are storming higher
• ASX 200 (ASX:XJO) midday update: Zip shares tumble, AUSTRAC takes aim at Crown

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 Bruce Jackson.

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The Bitcoin (CRYPTO: BTC) price has bounced back from a loss to a 2% gain following a strong run over the past few hours.

One Bitcoin is currently worth US$38,626 (AU$52,760), giving the world’s original crypto a market cap of US$740.0 billion.

Despite the rebound, the Bitcoin price remains down 10% over the past 7 days and down 20% year-to-date.

The Ripple (CRYTPO: XRP) price is gaining today too, up 1% since this time yesterday to 72.8 US cents.

XRP, the world’s number 6 crypto with a market cap of US$34.7 billion, remains down 15% for the year. We bring this particular token up for a reason.

If you’re unfamiliar with XRP, the token was created by Ripple Lab as a “digital asset built for global payments”.

According to CoinMarketCap this implies that, “Ripple plans to rival money transfers usually conducted by the banking system. XRP would allow users to send money at a very low cost, attracting the potential interest of retail customers and banks alike.”

Which brings us back to Visa and Mastercard removing their payment services from Russia in response to its invasion of Ukraine. This comes atop the earlier ban of many Russian banks from the global SWIFT service.

With more Russian institutions and individuals locked out of traditional payment systems, will this impact the Bitcoin price and other payment focused cryptos like XRP?

Will Visa and Mastercard’s Russia ban impact the Bitcoin price?

Josh Gilbert, market analyst at multi asset investment platform eToro, sees the potential for an increased demand for cryptos as Russians are locked out from global credit cards. And greater demand could send the Bitcoin price higher.

According to Gilbert:

The latest Visa and Mastercard restrictions will further tighten how Russians are able to access capital, meaning we may well see an increase in demand for cryptoassets. Bitcoin is borderless, so at times like this, citizens can turn to cryptoassets to store and spend their capital.

The restrictions from Swift, Visa and Mastercard could see demand pivot to cryptoassets that specialise in payments, such as XRP, given its ability to instantly and efficiently move money across all corners of the world through its decentralised blockchain.

Emphasising that crypto is not something you just store in a digital wallet hoping the price will go up, Gilbert added:

The last few weeks have highlighted crypto’s real-world use cases, and everyday consumers now understand there is much more to crypto than just an investable asset. This could shepherd in a new era of finance; payments in under a matter of seconds, decentralisation away from corporations or governments, and the provision of finances when traditional methods are not available.

Despite greater clarity surrounding its real-world use cases, the Bitcoin price has yet to lift off in the wake of heavy selling following its November all-time highs.

Can Russia skirt sanctions with crypto?

One of the big concerns with cryptos like Bitcoin and XRP is that the Russian government may use them to do an end run around sanctions imposed by the West.

You’ve probably heard these debates, also linked to organised criminal activity, amongst various politicians and analysts yourself.

But the top brass at global crypto exchange FTX says it will be nigh impossible for Russia to do so on any kind of appreciable scale.

According to FTX president Brett Harrison and CEO Sam Bankman-Fried:

The world’s attention on Russia’s aggressive conflict with Ukraine, combined with the new omnipresence of cryptocurrencies, has created the natural question now being asked in all major media: can cryptocurrency be used by sanctioned parties to avoid US sanctions?

The short answer is: no.

Harrison and Bankman-Fried give a long list of security protocols in place to prevent sanctioned institutions from simply reverting to Bitcoin, XRP or other cryptos over fiat currency.

Among those protocols, they said:

Exchanges that can accept wire transfers as sources of fiat deposits know the identity of the source financial institution, and can therefore detect whether the currency is coming from, for example, a sanctions listed Russian bank, a blacklisted source, or some other problematic funds source.

The post How might Visa and Mastercard’s Russia ban impact the Bitcoin price? appeared first on The Motley Fool Australia.

More reading

• Why the Bitcoin price should surge to US$50,000 in March: expert
• Considering adding crypto to your super? Read this
• More valuable than the rouble: How the Ukraine crisis is now boosting the Bitcoin price
• Is Bitcoin or gold a better buy for these uncertain times?
• How might the Ukraine crisis impact the Ethereum price?

The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns and has recommended Bitcoin. The Motley Fool Australia owns and has recommended Bitcoin. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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What a roller-coaster ride it has been this year for the Lynas Rare Earths Ltd (ASX: LYC) share price.

After starting the year flat, shares in the world’s second-largest producer of rare earths tumbled in late January.

However, this was short-lived with a quick rebound in late February following the company’s release of its interim results.

Last week, Lynas shares climbed by more than 10%, hitting a 1-month high of $11.21.

Nonetheless, investors headed for the exits sending the share price down 10% this week alone.

At the time of writing, Lynas shares are swapping hands for $9.64 apiece, a loss of 3.64% for today.

Why is the Lynas share price so volatile?

While the company’s reported an outstanding financial scorecard for the first-half of FY22, investors have been looking to cash in.

This is because Lynas produces Neodymium-Praseodymium (NdPr) which is a magnetic rare earth alloys used in many modern technologies.

The price of NdPr has mostly soared in the past few weeks as Western countries try to limit China’s rare earths dominance.

Lynas is considered to be the world’s second largest producer of NdPr, behind the Asian giant. The latter accounted for 60% of the global production of rare earths last year.

In case you were wondering, rare earths are a group of 17 metals that are critical to the manufacturing of many electronic products. These include mobile smartphones, electric vehicles, aircraft engines, wind turbines, and even military equipment.

With geopolitical tensions rising between the West and Russia, and China sidelined for now, the supply of rare earths could not be more important.

Lynas is seeking to disrupt China’s supply of rare earths and become a vital company for advanced economies.

However, for this to happen, the company will need to increase production output significantly.

In the six months ending 31 December, Lynas was marred with shipping delays that impacted NdPr production. Output fell to 2,614 tonnes compared to the 2,709 tonnes achieved in the prior corresponding period.

On a positive note, strong demand for rare earths is reflected in market pricing which led to Lynas achieving a record profit of $156.9 million. This reflected a 286% increase when measured against H1 FY21.

What do the brokers think?

After releasing its half-year results, one broker rated the company with a favourable price point.

Analysts at Macquarie raised its 12-month price target for Lynas shares by 2% to $12.60.

Based on the current share price, this implies a potential upside of more than 30% for investors.

The post Up 10% in one week, down 10% in the next. What’s going on with the Lynas (ASX:LYC) share price? appeared first on The Motley Fool Australia.

More reading

• These were the best performing ASX 200 shares last week
• Why has the Lynas (ASX:LYC) share price rocketed 21% in a week?
• Here are the top 10 ASX shares today
• Lynas (ASX:LYC) share price jumps amid record interim net profit
• The ASX share that the whole world is relying on

Motley Fool contributor Aaron Teboneras 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 Bruce Jackson.

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In late afternoon trade, the S&P/ASX 200 Index (ASX: XJO) is on course to record a disappointing decline. At the time of writing, the benchmark index is down 0.7% to 6,990.5 points.

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

Bapcor Ltd (ASX: BAP)

The Bapcor share price is down 3% to $6.06. This decline appears to have been driven by news that the auto parts retailer’s chief operating officer (COO) is leaving the company. This means that Bapcor has now lost its CEO and its COO in the space of three months.

GQG Partners Inc (ASX: GQG)

The GQG share price is down 6% to $1.17. This fund manager’s shares have been hammered since the release of its latest funds under management (FUM) update on Monday. Although that update revealed that fund inflows continued during February, its overall FUM fell by 1.6% month on month to $89.8 billion.

Smartgroup Corporation Ltd (ASX: SIQ)

The Smartgroup share price is down 8% to $7.71. A good portion of this decline has been driven by the salary packaging company’s shares trading ex-dividend this morning. Eligible shareholders can now look forward to receiving the company’s fully franked 49 cents per share final dividend later this month on 23 March. This includes a special 30 cents per share dividend.

Woodside Petroleum Limited (ASX: WPL)

The Woodside share price is down 4% to $33.08. Investors have been selling this energy producer’s shares after oil prices pulled back from 13-year highs. Despite today’s decline, the Woodside share price is still up a whopping 22% since this time last month. Supply concerns have been propelling oil prices to such high levels.

The post Why Bapcor, GQG, Smartgroup, and Woodside shares are dropping appeared first on The Motley Fool Australia.

More reading

• Why is the Bapcor (ASX:BAP) share price underperforming today?
• Woodside (ASX:WPL) share price slips for first time in 7 days
• 5 things to watch on the ASX 200 on Tuesday
• Here are the top 10 ASX shares today
• WAM boss urges cashed-up ASX 200 companies to buy, invest or pay dividends

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 owns and has recommended SMARTGROUP DEF SET. The Motley Fool Australia has recommended Bapcor. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The S&P/ASX 200 Index (ASX: XJO) is having another disappointing day so far this Tuesday. At the time of writing, the ASX 200 is down by a disappointing 0.6% at just under 7,000 points after bouncing up and down all day. 

But rather than trying to figure that out, let’s instead take a look at the shares currently topping the ASX 200’s volume charts, according to investing.com.

The 3 most traded ASX 200 shares by volume so far this Tuesday

Coronado Global Resources Inc (ASX: CRN)

Metallurgical coal company Coronado is a miner that finds itself on this list today. As it currently stands, an eyecatching 20.63 million of this ASX 200 company’s shares have bounced around the ASX this Tuesday.

Again, there’s no news out from the company to speak of, but Coronado has also had a big drop in value on the markets. Its shares are currently down a depressing 4.03% at $1.98 each. But that still leaves Coronado up close to 35% over the past month, to put that into perspective.

South32 Ltd (ASX: S32)

Diversified ASX 200 miner South32 is our next share up this Tuesday. So far today, a notable 21.05 million South32 shares have found a new home. There’s been no fresh news out of the company today.

Thus, it’s likely that this elevated volume is the result of the nasty tumble South32 has endured so far today. The company is currently down by 6.34% at $5.02 a share. However, it remains up close to 20% over the past month.

Nickel Mines Ltd (ASX: NIC)

It’s all about those miners today, it seems. ASX 200 nickel share Nickel Mines is our third and final ASX share experiencing elevated trading volumes on the markets. In this company’s case, a hefty 33.6 million shares of Nickel Mines have changed hands as it currently stands.

As is a theme today, this doesn’t appear to be the result of anything out of the company itself. Rather, another large share price fall seems to be to blame. Nickel Mines is presently down by 4.7% at $1.57 a share. But that comes just after the company hit a new 52-week high only yesterday. 

The post These 3 ASX 200 shares are topping the volume charts on Tuesday appeared first on The Motley Fool Australia.

More reading

• 15% yield! But are these ASX high-yield shares dividend traps?
• 5 ASX mining shares smashing 52-week highs today
• Here’s why the Nickel Mines (ASX:NIC) share price just hit an all-time high
• Here’s why the South32 (ASX:S32) share price has soared 25% in a month
• ASX 200 (ASX:XJO) midday update: CSL and St Barbara charge higher

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 Bruce Jackson.

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The Kogan.com Ltd (ASX: KGN) share price is soaring on Tuesday despite the company’s silence.

At the time of writing, Kogan’s shares are trading for $5.54, 3.55% higher than their previous close.

Let’s take a look at what might be driving the online retailer’s stock higher.

Why is the Kogan share price gaining today?

Kogan’s stock is in the green today, for the first day since last Wednesday.

That’s despite the broader market spending today in the red. Right now, the S&P/ASX 200 Index (ASX: XJO) is down 0.63% while the All Ordinaries Index (ASX: XAO) has slumped 0.75%.  

However, the Kogan share price plunged 4.1% yesterday and 4.4% on Friday. Thus, today’s gain could be the market correcting itself after the unexplained sell-off.

Additionally, the S&P/ASX 200 Consumer Discretionary Index (ASX: XDJ) has spent most of today in the green.

Meaning some of Kogan’s retail peers are also outperforming the broader market.

Like the Kogan share price, Temple & Webster Group Ltd (ASX: TPW) and Dusk Group Ltd (ASX: DSK) are recording better-than-average performances. They’re gaining 0.69% and 3.67% respectively.  Though, most ASX retailers are in the red today. 

Additionally, the pureplay online retailer might be being lumped in with the tech sector on Tuesday.

Right now, the S&P/ASX All Technology Index (ASX: XTX) is up 0.11% while the S&P/ASX 200 Info Tech Index (ASX: XIJ) has gained 0.06%.

Though, today’s boost hasn’t been enough to get the Kogan share price back into the long-term green.

It’s currently down 35% year to date. It has also fallen 57% since this time last year.

The post Why is the Kogan (ASX:KGN) share price leaping 4% today? appeared first on The Motley Fool Australia.

More reading

• These are the 10 most shorted ASX shares
• Down 36% in 2022, should investors jump on the Kogan (ASX:KGN) share price?
• What’s the outlook for ASX retail shares like Kogan (ASX:KGN)?
• These are the 10 most shorted ASX shares
• Why Blackmores, BWX, Kogan, and Magellan shares are dropping

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. owns and has recommended Kogan.com ltd. The Motley Fool Australia owns and has recommended Harvey Norman Holdings Ltd. and Kogan.com ltd. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The Macquarie Group Ltd (ASX: MQG) share price could offer decent upside from current levels.

That’s the view of analysts at Morgans, which have just named the investment bank as one of their best ideas for March.

What does Morgans think about the Macquarie share price?

According to the note, Morgans has picked out its best ideas for the month of March. These are the ASX shares that the broker believes offer the highest risk adjusted returns over a 12-month timeframe and are supported by a higher than average level of confidence.

And while Morgans actually only has a hold rating on Macquarie’s shares, its price target is meaningfully higher than where it is trading today, so it makes the list.

The note reveals that the broker has a price target of $200.00 on its shares at present. This implies potential upside of 13% over the next 12 months based on the current Macquarie share price of $176.67.

In addition, Morgans is expecting a decent dividend yield over the next 12 months. Its analysts are forecasting a $6.63 per share dividend in FY 2022. This equates to a 3.8% yield at current levels, which stretches the total return on offer with Macquarie’s shares to 17%.

What did the broker say?

Morgans sees value in the current Macquarie share price and growth opportunities for the bank in infrastructure and renewables.

Its analysts commented: “We still see MQG as relatively inexpensive and continue to like its exposure to long-term structural growth areas such as infrastructure and renewables. Near term MQG is likely to face earnings pressure from the impact of soft economic conditions but remains well positioned to ride out the current Covid-19 period and seize opportunities on the other side.”

In respect to renewables, Macquarie spoke about some of its plans in the space at the AFR Summit today.

Macquarie’s CEO, Shemara Wikramanayake, said: ”Agriculture is another big source of emissions, a lot bigger here than overseas.”

In light of this, Macquarie is working with the CSIRO to produce new types of plant feed that reduces emissions. It is also focusing on other solutions to help the globe transition away from fossil fuels and combat catastrophic climate change.

Based on what Morgans is saying, its analysts see a big opportunity for Macquarie with these activities.

The post Broker tips Macquarie (ASX:MQG) share price to rise 13% appeared first on The Motley Fool Australia.

More reading

• Why the Pilbara (ASX:PLS) share price is a buy right now: expert
• Is the ASX set to welcome yet another BNPL share? Macquarie-backed company gears up for IPO
• Is Macquarie (ASX:MQG) gearing up to ink its next big deal?
• ‘We are accountable’: Macquarie (ASX:MQG) weighs in on the future of green hydrogen
• 2 big-cap ASX shares that even this small-cap expert recommends

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 Macquarie Group Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The Electro Optic Systems Holdings Limited (ASX: EOS) share price is in the red this week amid changes to the S&P/ASX 300 Index.

The company’s shares are currently swapping hands at $1.655 each, down 3.5%. The Electro Optic share price has lost almost 9% in the past week.

Let’s take a look at what is happening with Electro Optic lately.

Removal from ASX 300

Electro Optic Systems has been removed from the S&P/ASX 300 Index. Investors were informed of this decision in an announcement to the market after close on Friday.

Other shares facing the axe from the index include Mount Gibson Iron Limited (ASX: MGX), Opthea Limited (ASX: OPT), and Marley Spoon Ag (ASX: MMM).

Joining the ASX 300 club are Aussie Broadband Limited (ASX: ABB), Core Lithium Limited (ASX: CXO), and MA Financial Group Limited (ASX: MAF) among others. The changes will take effect prior to open on March 22.

This news comes on the back of a tough year for the defence, space, and communications company. Since the start of the year, the Electro Optic share price has slipped more than 28%.

Electro Optic shares took a hit on 28 February amid the release of the company’s full-year earnings results for 2021. It reported a 12.2% drop in its underlying revenue to $14.3 million, while its net loss improved 32% to $16.8 million.

Just days earlier, on February 25, Electro Optic shares charged 12% higher on a satellite update. Electro Optic announced its subsidiary SpaceLink had made several satellite “breakthroughs”, including an upgraded design. The company believes this will boost profit due to improved margins on cost.

Electro Optic share price summary

The Electro Optic share price has plunged more than 66% in the past 52 weeks, while it is down almost 26% in the past month alone.

For perspective, the S&P/ASX 200 Index (ASX: XJO) has returned around 4% over the past year.

The company has a market capitalisation of about $252 million.

The post What’s impacting the Electro Optic (ASX:EOS) share price this week? appeared first on The Motley Fool Australia.

More reading

• Could this ASX defence share be set to benefit from the Ukraine crisis?
• Electro Optic (ASX:EOS) share price plunges 13% on net loss
• Electro Optic (ASX:EOS) share price rockets 18% on ‘breakthrough’ satellite news

The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns and has recommended Electro Optic Systems Holdings Limited. The Motley Fool Australia owns and has recommended Electro Optic Systems Holdings Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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Investors in the Australian Foundation Investment Co. Ltd (ASX: AFI), or AFIC for short, presumably want to see one thing from the AFIC share price: outperformance of the S&P/ASX 200 Index (ASX: XJO). AFIC has been around for decades. But over the past 20 years or so it has had to confront the rise of the exchange-traded fund (ETF).    

Index ETFs mirror the indexes they track, with a very small management fee. As such, investors now have alternatives to a Listed Investment Company (LIC) like AFIC if they want a broad-based and diversified ASX share investment under a single ticker code.

So AFIC investors might be delighted to find that AFIC has indeed topped out the ASX 200 over 2022 so far. This year has proven to be an exceptionally wild and volatile one thus far, as most ASX investors would be aware of. 

The ASX 200 itself has spent the year going backwards. On today’s pricing, the ASX 200 has lost 7.63% of its value. But in contrast, the AFIC share price has only lost 5.9%. That’s a meaningful outperformance of more than 1.7% over 2 months or so.

So how has AFIC done it?

AFIC share price beats out the ASX 200 over 2022 thus far

By differentiation, of course. BHP Group Ltd (ASX: BHP) is now the largest ASX 200 share on the index by far, thanks to its recent ASX unification. But as of 31 January, it remains the second-largest holding in AFIC’s share portfolio. In it’s place, we have Commonwelath Bank of Australia (ASX: CBA).

AFIC has also diverted more capital to Macquarie Group Ltd (ASX: MQG) than the other major big four bank shares. In fact, Wesfarmers Ltd (ASX: WES) and Transurban Group (ASX: TCL) occupy more weighting in AFIC’s portfolio than Westpac Banking Corp (ASX: WBC) and National Australia Bank Ltd. (ASX: NAB). And Australia and New Zealand Banking Group Ltd (ASX: ANZ) was only the 12th largest position in AFIC’s portfolio, versus its 6th place in the ASX 200. That has helped AFIC mitigate the effects of ANZ’s near-11% plunge this year so far. 

So it’s likely due to portfolio differences like these that have helped AFIC to outperform the ASX 200 over 2022 thus far. Let’s see what the rest of 2022 holds in store for AFIC. 

The post Index beater! How has the AFIC (ASX:AFI) share price outperformed the ASX 200 in 2022? appeared first on The Motley Fool Australia.

More reading

• Which new investments are predicted to help the AFIC (ASX:AFI) share price and dividends?
• AFIC (ASX:AFI) is the biggest LIC on the market. But how does its performance stack up?
• Why is the AFIC (ASX:AFI) share price sliding lower today?

Motley Fool contributor Sebastian Bowen owns National Australia Bank Limited. 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 and Westpac Banking Corporation. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The Arafura Resources Limited (ASX: ARU) share price is launching upwards today despite no word having been released by the company.

However, there have been several happenings over the last few days that could be boosting the stock.

At the time of writing, the Arafura Resources share price is 20.5 cents, 7.89% higher than its previous close.

For context, the S&P/ASX 200 Index (ASX: XJO) is currently down 0.49%, while the All Ordinaries Index (ASX: XAO) has slipped 0.6%.

Let’s take a look at what might be driving the rare earths developer’s stock lately.

Why is the Arafura Resources share price soaring today?

The Arafura Resources share price is well and truly in the green on Tuesday.

Today’s movements follow the stock’s 5% fall yesterday. It also fell 9% over Thursday and Friday.

Thus, today’s gains could be a market correction after its multi-day sell-off.

It could also feasibly be a reaction to recent news from S&P Dow Jones Indices. On Friday evening, the body announced Arafura Resources will be added to the All Ords on 21 March.

Its addition to the index tracking the 500 largest companies on the ASX could see trade in the rare earths company’s stock increase later this month.

That’s because funds tracking the index will be forced to snap up its shares.

At the same time, fund managers mandated to only trading in All Ords shares might prick their ears towards the stock.

Finally, The Arafura Resources share price might be being supported by the value of rare earths in 2022.

According to reporting from Reuters – published last week – China has called on rare earth producers to help lower the price of minerals needed for electric vehicles and the like.

The publication stated that the price of rare earths were near record highs on Friday.

Interestingly, stock in Arafura Resources’ rare earth-focused peers, Lynas Rare Earths Ltd (ASX: LYC) and Iluka Resources Limited (ASX: ILU) are down 2.7% and 3.7% respectively right now.

Despite today’s gains, the Arafura Resources share price is 8% lower than it was at the start of 2021.

The post Why is the Arafura Resources (ASX:ARU) share price leaping 8% today? appeared first on The Motley Fool Australia.

More reading

• Broker sees 19% upside for Telstra (ASX:TLS) share price and 4% dividend yield
• Diversification? Why VAS is really a bet on banks and miners
• Why is the Polynovo (ASX:PNV) share price sinking to a new multi-year low?
• Broker names 3 of the best ASX 200 shares to buy in March
• This ASX energy share is combatting its sector’s sell-off to hit 9-year highs

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 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 Bruce Jackson.

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