Owning Pilbara Minerals Ltd (ASX: PLS) shares has come with a rollercoaster of emotions so far in 2023. While the lithium producer‘s share price is up 14% so far this year, the past month has delivered a 13% decline.

A meteoric rise in profits and the company’s inaugural dividend have been overshadowed by a sharp fall in the price of lithium. Bringing unease to shareholders, lithium carbonate prices are back to where they were a year ago as supply begins to momentarily catch up with demand.

So, can the electrifying commodity producer continue to harvest monster profits, or could the top of the cycle be behind it?

To try to answer this question, we found one bull and one Pilbara Minerals bear among our team of writers. Eager to share their thoughts, our Foolish duo delves into whether or not Pilbara Minerals shares could be a sound investment right now.

Here is what they said:

The bull case for Pilbara Minerals shares 

By Bernd Struben: I’m long-term bullish on Pilbara Minerals based on a number of strengths.

First, the company is the sole owner of the Pilgangoora Lithium-Tantalum Project in Western Australia, the world’s largest, independent hard-rock lithium operation.

Second, while lithium prices may come under pressure over the medium term amid oversupply concerns, the metal will remain in strong demand amid the rapid global growth of EVs and grid storage batteries.

Around 75% of the world’s consumption of lithium currently goes into rechargeable batteries. Furthermore, EV sales are forecast to grow tenfold over the next decade. It’s expected that EVs will represent 30% of sales in China in 2023, up from only 5% in 2019.

Third, Pilbara Minerals recently posted some stellar half-year results. Compared to the six months ending 31 December 2021, the miner reported a 989% increase in statutory net profit after tax (NPAT), which reached $1.2 billion. Meanwhile, the company’s revenue of $2.2 billion was up 305%.

Fourth, Pilbara Minerals leapt onto income investors’ radars when its board declared the first-ever dividend of 11 cents per share, fully franked. That represents a 2.6% trailing yield. But that’s just the interim dividend. I expect Pilbara will pay out at least that much for a final dividend when the company reports its full-year results.

And fifth, Pilbara Minerals is doing an excellent job of increasing its output. Production of spodumene concentrate leapt 83% over the six months (from the prior corresponding half year) to reach 309,255 dry metric tonnes (dmt). And the miner recently lifted its production guidance for the full year to between 600,000 and 620,000 dmt.

Should lithium prices fall as much as the extreme bearish cases suggest, Pilbara’s profits and dividends will likely shrink. But longer-term, I believe investors will look back at today’s share price and wish they’d bought more.

Motley Fool contributor Bernd Struben does not own shares in Pilbara Minerals Ltd.

What about the grizzly bear? 

By Sebastian Bowen: There’s little doubt Pilbara Minerals is a well-run company. It has indeed seen unprecedented success in 2022 and 2023 so far, recently delivering bumper profits and its first-ever dividend payment.

But just because a company has seen success doesn’t mean it will be a good long-term investment.

At its core, Pilbara is a price-taker. Most ASX shares are able to set the prices for the goods or services they provide. This enables the best companies to compound their earnings and profits over time. But Pilbara, like all miners and drillers, is at the mercy of the markets.

In Pilbara’s case, this company holds regular auctions where buyers decide what they want to pay for Pilbara’s lithium products. This is great when lithium prices are elevated, as they are right now. But like all commodities, lithium goes through cycles.

When prices rise, producers are incentivised to increase output and therefore supply. Over time, increased supply reduces the pricing of said commodity. Most commodities fluctuate in this way, which makes it difficult for the companies that produce them to consistently grow profits.

If lithium prices go through a down cycle sometime in the future (which I believe is inevitable), we could well see Pilbara’s profits collapse, and its new dividends trimmed or even suspended. This fundamental nature of commodity-based shares like Pilbara makes them less than ideal candidates for a buy-and-hold investment in my view.

Further, Pilbara’s business case is built around the assumption that lithium will continue to play a massive role in the electrification of transport. Yes, right now almost all electric vehicles use lithium-ion batteries. But other battery technologies, using other metals, have been dominant before.

What happens to Pilbara if vanadium batteries become more effective and efficient than lithium-based ones, for example? I think it’s a coin-toss situation when debating whether lithium will forevermore be the world’s dominant battery technology.

So, all in all, I think there are too many risks with Pilbara’s business case to make it a solid long-term investment. Lithium is an important metal in today’s economy. But that doesn’t mean any company producing lithium products has a license to print money indefinitely.

Motley Fool contributor Sebastian Bowen does not own shares in Pilbara Minerals Ltd.

The post Pilbara Minerals shares: Bull vs. Bear appeared first on The Motley Fool Australia.

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• Here are the 3 most heavily traded ASX 200 shares on Monday
• Macquarie tips 100% total return from Pilbara Minerals shares
• Big yields and even bigger gains lie ahead for these ASX 200 shares: analysts
• Here are the top 10 ASX 200 shares today
• Here are the 3 most heavily traded ASX 200 shares on Friday

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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On Tuesday, the S&P/ASX 200 Index (ASX: XJO) jumped after the RBA’s cash rate meeting and ended the day with a solid gain. The benchmark index rose 0.5% to 7,364.7 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 give back yesterday’s gains and more on Wednesday following a poor night on Wall Street. According to the latest SPI futures, the ASX 200 is expected to open the day 67 points or 0.9% lower this morning. In late trade on Wall Street, the Dow Jones is down 1.8%, the S&P 500 is down 1.7% and the Nasdaq is 1.4% lower. This follows comments by the US Federal Reserve that rates may go higher than previously expected.

Oil prices sink

Energy producers Beach Energy Ltd (ASX: BPT) and Woodside Energy Group Ltd (ASX: WDS) could have a difficult session after oil prices sank overnight. According to Bloomberg, the WTI crude oil price is down 3.7% to US$77.52 a barrel and the Brent crude oil price has dropped 3.4% to US$83.26 a barrel. Traders were selling oil on US rate hike concerns.

InvoCare downgraded

The team at Morgans has downgraded InvoCare Limited (ASX: IVC) shares to a hold rating with an improved price target of $12.19. This follows news that TPG has tabled a non-binding takeover offer of $12.65 per share. The broker assigns a 70% probability that the deal completes and appears to believe investors should be locking in their gains.

Gold price tumbles

Gold miners Evolution Mining Ltd (ASX: EVN) and Northern Star Resources Ltd (ASX: NST) could have a tough session after the gold price tumbled overnight. According to CNBC, the spot gold price is down 2% to US$1,818.5 an ounce. A hawkish US Fed put pressure on the precious metal,

ASX 200 shares going ex-div

A number of ASX 200 shares are going ex-dividend on Wednesday and could trade lower. This includes logistics solutions company Brambles Limited (ASX: BXB), retail group Super Retail Group Ltd (ASX: SUL), and energy giant Woodside. The latter will then be paying a massive 211.3 cents per share final dividend to shareholders in April.

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

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• Why did the Woodside CEO just sell off over $200,000 worth of shares?
• Here are the 3 most heavily traded ASX 200 shares on Tuesday
• Owners of this ASX 200 share are soon going to receive a bigger dividend
• 5 ASX 200 shares trading ex-dividend today
• Why InvoCare, Pentanet, Sayona Mining, and Weebit Nano shares are storming higher

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ASX shares capable of both capital growth and dividend income are a rare combination sought by many investors.

Sure, one could pick up a big bank to reap income, but they have no massive prospect of growth in a saturated market.

Conversely, a high-flying tech company might do the trick for future growth, but very rarely do they pay out a decent dividend. Any free cash is ploughed back into the business to fuel further growth.

In the current climate of a stressed economy from rising interest rates, stocks with the golden combination have become even rarer.

Fortunately for The Motley Fool readers, one expert named two such ASX shares they could buy right now:

‘Well managed’ business giving plenty back to investors

The Silk Logistics Holdings Ltd (ASX: SLH) share price has remarkably gained more than 20% over the past 12 months, during a period when most non-mining stocks tanked.

What’s more, it already pays out a dividend yield of 4.7%.

Morgans investment advisor Jabin Hallihan reckons the stock price could head up 54% from the current level of around $2.47 while paying out even more dividend.

“Our valuation is $3.80 a share,” Hallihan told The Bull.

“We forecast a gross dividend yield of about 5%.”

The business is “well managed”, he added, and presented impressively during reporting season.

“The integrated logistics provider posted revenue of $253.6 million in the first half of fiscal year 2023, an increase of 39.1% on the prior corresponding period,” Hallihan said.

“Underlying net profit after tax of $9.8 million represented an increase of 32.4%.”

The Morgans team is expecting Silk Logistics to rake in between $480 million and $500 million for the full financial year.

‘A significant development’ for lithium business

Mining services provider Mineral Resources Ltd (ASX: MIN) digs up all sorts of minerals, but its involvement in lithium production has seen its share price rocket 83% over the past year.

But the stock has remained flat over the past month due to a lukewarm reporting season.

Hallihan is still bullish on the Western Australian company.

“While the first half 2023 result didn’t meet consensus expectations, we expect a stronger second half as we anticipate lower costs.”

He noted the recently announced budding agreements with the US company Albemarle Corporation (NYSE: ALB).

“We expect an equal joint venture conversion agreement to obtain a capacity of producing 100,000 tonnes of lithium chemicals a year from 2025.

“It’s a significant development amid increasing demand for lithium.”

The Morgans team has placed its fair valuation for Mineral Resources at $102, suggesting a 16.4% upside from the current level.

The dividend yield for Mineral Resources stands at 2.5% fully franked.

The post 2 ASX shares offering both growth and nice dividends: expert appeared first on The Motley Fool Australia.

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• Mineral Resources share price slides as Norwest takeover bid heats up
• Which ASX All Ords shares would be on my watchlist for generating massive dividends?
• Want passive income? These are the ASX dividend shares to buy according to experts
• What’s happening with ASX 200 lithium stocks this week?
• Buy Minerals Resources shares for 21% upside: broker

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 no position in any of the stocks mentioned. The Motley Fool Australia has recommended Silk Logistics. 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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Are you wanting to add some diversification to your portfolio? If you are, then you might want to look at exchange traded funds (ETFs).

The reason for this is that ETFs give investors easy access to a large and diverse number of different shares through just a single investment.

With that in mind, listed below are two ETFs that are popular with investors. Here’s what you need to know about them:

Vanguard MSCI Index International Shares ETF (ASX: VGS)

The first ETF to look at is the Vanguard MSCI Index International Shares ETF. This ETF provides investors with exposure to approximately 1,500 of the world’s largest listed companies from major developed countries.

Vanguard highlights that this ETF gives investors low-cost access to a broadly diversified range of securities that allows them to participate in the long-term growth potential of international economies outside Australia.

Among the many high quality companies that investors will be owning a part of are giants such as Apple, Johnson & Johnson, JP Morgan, Nestle, Nvidia, Procter & Gamble, and Visa.

Vanguard U.S. Total Market Shares Index ETF (ASX: VTS)

Another ETF that could be a top option for investors is the Vanguard US Total Market Shares Index ETF. Especially if you’d rather just invest in the United States and not globally.

That’s because this ETF allows you to invest into a massive 4,000 US listed shares in one fell swoop.

Vanguard highlights that this allows investors to participate in the long-term growth potential of US listed companies.

As well as tech giants such as Amazon, Apple, and Microsoft, you’ll be buying a slice of iconic US companies such as Boeing, JP Morgan, Starbucks, Tesla, and Walmart.

The post 2 excellent ETFs for ASX investors to buy now appeared first on The Motley Fool Australia.

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• 3 excellent ETFs for ASX investors to buy in March
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• 2 fantastic ETFs for ASX investors to buy and hold

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 Vanguard Msci Index International Shares ETF. The Motley Fool Australia has recommended Vanguard Msci Index International Shares 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’re looking for dividend shares to buy this week, then the two listed below could be worth checking out.

Both have been named as buys by analysts and tipped to provide attractive yields. Here’s what you need to know about them:

HomeCo Daily Needs REIT (ASX: HDN)

The first ASX dividend share that has been named as a buy for income investors is HomeCo Daily Needs.

HomeCo Daily Needs is a property investment company with a focus on metro-located, convenience-based assets across neighbourhood retail, large format retail, and health and services.

Morgans is a fan and has an add rating and $1.50 price target on HomeCo Daily Needs’ shares. Following its first-half results, the broker commented:

HDN offers investors exposure to a portfolio of daily needs assets with its large development pipeline to provide both near-term and future growth opportunities. FY23 guidance was reiterated; metrics stable across the $4.7bn portfolio; and cap rate expansion was offset by property income growth. Looking ahead, the focus also remains on recycling assets and the development pipeline which has been boosted to +$600m from +$500m.

As for dividends, the broker is forecasting dividends per share of 8.3 cents in FY 2023 and 8.4 cents in FY 2024. Based on the current HomeCo Daily Needs share price of $1.28, this will mean dividend yields of 6.5% and 6.6%, respectively.

National Australia Bank Ltd (ASX: NAB)

Goldman Sachs is a fan of this big four bank and sees it as an ASX dividend share to buy.

Its analysts currently have a buy rating and $35.42 price target on its shares. The broker was impressed with NAB’s first-quarter performance and believes it is well-placed to continue this positive form. It explained:

We reiterate our Buy on NAB given: i) we see volume momentum over the next 12 months as favouring commercial volumes over housing volumes and we believe NAB provides the best exposure to this thematic, ii) NAB has delivered the highest levels of productivity over the last three years, which we think leaves it well positioned for an environment of elevated inflationary pressure, iii) NAB’s 1Q23 operating trends seem consistent with management commentary at its FY22 result (here), particularly with regard to NIMs, which we view as a positive given the commentary CBA made at its 1H23 result (here), which suggested NIMs have peaked. Reiterate Buy.

In respect to dividends, Goldman Sachs is expecting NAB to pay fully franked dividends of $1.73 per share in FY 2023 and $1.76 per share in FY 2024. Based on the current NAB share price of $29.71, this means yields of 5.8% and 5.9%.

The post Buy NAB and this ASX passive income share: analysts appeared first on The Motley Fool Australia.

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• Should I buy NAB shares at $29?
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• Why I think NAB could be the best ASX 200 bank share to buy right now
• Experts name 2 ASX All Ords shares to buy after their excellent results

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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When a company executive sells off shares in their own business, it can often raise some eyebrows with investors. Those chosen few who manage the finances and operations of an ASX 200 company are well paid for the privilege.

So it understandably causes some consternation when those people reduce the skin they have in the game they are running.

That is especially so when it comes to a company CEO.

This is the situation that is confronting shareholders of the ASX 200 energy giant Woodside Energy Group Ltd (ASX: WDS) this week. Yesterday, just before market open, Woodside released an ASX announcement detailing some share sales that were initiated by its CEO Meg O’Neill.

Woodside CEO offloads shares, should investors be worried?

According to the release, O’Neill sold 6,761 shares of Woodside on 1 March for a sum of $244,774.34. That works out at an average selling price of $36.20 per share.

However, this wasn’t an ordinary share sale. O’Neill, alongside other Woodside executives, is entitled to receive what are known as ‘restricted shares’ under the company’s remuneration policy.

Restricted shares are awarded to executives based on corporate performance criteria. They are ordinary shares that are issued on a deferred basis, typically for three or five years.

So O’Neill clearly received these shares and now she is able to sell them. Which she has.

But should investors be worried?

Well, that’s up to every individual shareholder. Some might like to see management figures like O’Neill accumulate every share they can, giving them the highest level of shareholder alignment when it comes to financial interests.

But good wealth management principles don’t suspend for company executives, even CEOs. Most investors would agree that putting all of your eggs in one basket is a poor way to run a share portfolio.

Diversification is important, even for CEOs. So perhaps other shareholders won’t mind that O’Neill invests in other assets outside Woodside shares. Perhaps she needs the money for a new house, or a holiday.

Even so, it’s not like O’Neill doesn’t have skin in the Woodside game. After this sale, O’Neill still owns (directly and indirectly) 155,727 Woodside shares, with a value of just over $5.85 million. She also owns another 165,147 restricted shares, and 106,488 performance rights.

So perhaps considering this, the sale of just over $244,000 worth of Woodside shares might not seem so significant. Investors don’t seem to think so anyway, considering they have sent the Woodside share price up more than 5% in the past week alone:

The post Why did the Woodside CEO just sell off over $200,000 worth of shares? appeared first on The Motley Fool Australia.

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• Woodside share price gains as Albanese supports gas in energy ‘wake-up call’
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• Passive income watch: Here are the ASX 200 shares that delivered some of the biggest dividend boosts this earnings season
• 5 things to watch on the ASX 200 on Friday
• Why did the Woodside share price outperform the ASX 200 in February?

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 Qantas Airways Limited (ASX: QAN) share price hit a new 52-week high today of $6.71. This represents its highest price since the COVID-19 crash.

Shares in the airline have done well for shareholders over the last year, rising by 45%. In the past six months, they have gained around 25%.

The Qantas share price has been steadily climbing since the initial reaction to the airline’s FY23 half-year result. From 23 February 2023 to now, it has gone up by almost 10%.

Investors may have harked back to that result today, as well as taking in news the airline is planning to significantly increase its workforce.

Strong travel demand continues

The company recently announced that in the first six months of the year, it made underlying net profit before tax of $1.43 billion and statutory net profit after tax (NPAT) of $1 billion. This was a big swing compared to the losses it had been seeing during COVID. The recovery has certainly been helpful for the Qantas share price.

Thanks to the strong financials, net debt declined to $2.4 billion and the business announced a share buyback of up to $500 million.

Qantas pointed to a “material improvement in operational performance and customer satisfaction”.

Qantas CEO Alan Joyce said:

When we restructured the business at the start of COVID, it was to make sure we could bounce back quickly when travel returned. That’s effectively what’s happened, but it’s the strength of the demand that has driven such a strong result.

Fares have risen because of higher fuel costs, but also because supply chain and resourcing issues meant capacity hasn’t kept up with demand. Now those challenges are starting to unwind, we can add more capacity and that will put downward pressure on fares.

In terms of overheads, we expect the costs we’re carrying from the extra operational buffer will start unwinding from this half and into next financial year.

Investors may not have liked the sound of “downward pressure” on fares, considering how much profit Qantas is currently making from those high fares.

However, the airline said that travel demand is expected to remain strong throughout FY23 and into FY24. Domestic and international capacity is expected to increase throughout the second half of FY23, though this could come with moderating fares. However, fares are expected to remain “significantly above” FY19 levels.

That does sound promising for profitability and the Qantas share price.

Growth plans

Last week, the company announced that it expects to create more than 8,500 new highly skilled jobs, including new pilots and engineers.

Over the next decade, Qantas is expecting to grow its number of people from 23,500 currently to 32,000 by 2033.

While hiring more people doesn’t necessarily influence the Qantas share price, it could suggest the business is expecting to become much bigger and, by extension, could be making more profit.

Qantas share price snapshot

Over the past month, the Qantas share price is up around 0.5%.

The post Qantas share price takes off to new multi-year high on Tuesday appeared first on The Motley Fool Australia.

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• Own Qantas shares? Here’s how the ASX 200 airline plans to grow
• Boost your portfolio with these blue chip ASX 200 shares in March: experts
• Own Qantas shares? Guess who just joined the race to be the next CEO
• Broker tips Qantas share price to fly significantly higher
• Here are the top 10 ASX 200 shares today

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 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 Lynas Rare Earths Ltd (ASX: LYC) share price is down 1.95% to $7.31 at the time of writing.

In earlier trading, the rare earths stock hit a new 52-week low of $7.26 per share.

Meantime, the S&P/ASX All Ordinaries Index (ASX: XAO) is up 0.53% to 7,565.6 points today.

What’s dragging the Lynas share price down?

Well, it certainly doesn’t help that Telsa Inc (NASDAQ: TSLA) is doing away with rare earths in its electric vehicles (EVs).

At a recent Investor Day, Tesla announced its next-generation powertrain, which is an internal car system, will use a permanent magnet motor that does not require any rare earths components.

On top of that, sentiment towards Lynas shares hasn’t been good since the company released its 1H FY23 results last Monday. Since then, the Lynas share price has fallen by almost 15%.

The biggest problem with the results was a 32% increase in costs due to inflationary pressures on inputs like chemicals, utility tariff rates, and employee costs.

While Lynas increased its production and top-line revenue, the cost increases were higher, which meant its profit slipped 4% year-over-year.

Lynas is also dealing with drama in Malaysia over its recently renewed operating licence.

The licence prohibits the importing and processing of lanthanide concentrate due to concerns over radioactive waste.

Adhering to the condition would mean Lynas having to close its cracking and leaching plant from 1 July. So, Lynas is appealing that condition in its licence.

What do the experts think?

Following the release of the half-year results, and prior to the news from Tesla, two brokers gave their views on Lynas shares.

As my Fool colleague Tristan reported last week, JPMorgan increased its rating to neutral with a 12-month price target of $8.60.

Coming off this new 52-week low, that’s a potential 18.5% upside for investors.

UBS has cut its rating to neutral and cut its price target to $9. That’s still a 24% potential upside.

Lynas share price snapshot

The Lynas share price is down 4.5% in the year to date while ASX All Ords shares are up a collective 6%.

Over the past 12 months, Lynas has tumbled 26% while All Ords stocks have risen by 3.3%.

The post Why did the Lynas share price just hit a 52-week low? appeared first on The Motley Fool Australia.

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Motley Fool contributor Bronwyn Allen has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has 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) had barely regained its early day losses by 2:30pm AEDT to trade just about flat.

Then the Reserve Bank of Australia (RBA) released its latest interest rate decision.

The RBA board announced another 0.25% increase in interest rates, bringing the official cash rate to 3.6%.

Atop today’s cash rate hike, the RBA board also increased the interest rate on Exchange Settlement balances by another 0.25%, taking that to 3.5%.

The move was widely expected as inflation in Australia remains well above the central bank’s 2% to 3% target range.

Perhaps because investors were well prepared for another rate increase, the ASX 200 soared 0.6% immediately following the announcement.

March now marks the tenth consecutive interest rate hike from the central bank.

Rather amazingly, it was only on the morning of 3 May last year that Australia’s official rates were at the historic low of 0.1%. That afternoon saw the first rate hike from the RBA since November 2010.

Why did the RBA increase interest rates again?

Explaining why the board opted to raise interest rates yet again, RBA governor Philip Lowe noted that global inflation remains “very high”.

ASX 200 investors hoping that may turn around quickly will be disappointed by Lowe’s assessment. “It will be some time before inflation is back to target rates,” he said.

But the ASX 200 looks to be getting a boost from the report that inflation in Australia has at last peaked.

“The monthly CPI indicator suggests that inflation has peaked in Australia. Goods price inflation is expected to moderate over the months ahead due to both global developments and softer demand in Australia,” Lowe said.

Rents and services price inflation remain high.

The Aussie economy continues to grow but at a slower pace. GDP increased 0.5% in the December quarter and 2.7% over the year.

While employment dipped in January, the unemployment rate remains near 50-year lows. However, Lowe said, “As economic growth slows, unemployment is expected to increase.”

For now, wages are continuing to increase amid high inflation and a tight labour market. But in a potential signal of fewer rate hikes ahead, Lowe noted that “recent data suggest a lower risk of a cycle in which prices and wages chase one another”.

“The board, however, remains alert to the risk of a prices-wages spiral, given the limited spare capacity in the economy and the historically low rate of unemployment,” he added.

Judging by the big afternoon lift-off, ASX 200 investors don’t appear put out by all the uncertainty ahead either. Those uncertainties include the timing and extent of the slowdown in household spending, the full impact on house prices, and how the global economy holds up faced with rising rates around the world.

Lowe explained the RBA’s resolve to return inflation to within its 2% to 3% target range.

“If high inflation were to become entrenched in people’s expectations, it would be very costly to reduce later, involving even higher interest rates and a larger rise in unemployment,” he said.

What’s ahead for ASX 200 investors?

While inflation is expected to fall in 2023, the RBA forecasts inflation will remain above its target level throughout 2024. It expects inflation to be around 3% by the middle of 2025.

The central bank also expects GDP growth to be below trend for the next few years. However, Lowe said, “The outlook for business investment remains positive, with many businesses operating at a very high level of capacity utilisation.”

If you’re investing in ASX 200 shares, you should be prepared for at least one more interest rate increase. Perhaps more.

“The board expects that further tightening of monetary policy will be needed to ensure that inflation returns to target and that this period of high inflation is only temporary,” Lowe said.

The post ASX 200 lifts off as RBA raises interest rates yet again appeared first on The Motley Fool Australia.

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More reading

• Why did the Lynas share price just hit a 52-week low?
• Here are the 3 most heavily traded ASX 200 shares on Tuesday
• Morgans warns that these ASX shares could disappoint in FY23
• Owners of this ASX 200 share are soon going to receive a bigger dividend
• 5 ASX 200 shares trading ex-dividend today

Motley Fool contributor Bernd Struben has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has 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) has shaken off some morning blues and is pushing higher this afternoon, perhaps thanks to the Reserve Bank’s latest interest rate hike. At the time of writing, the ASX 200 has gained a healthy 0.51%, putting the Index at just over 7,365 points.

But enough on interest rates. Let’s instead delve a bit deeper into the stocks that are presently topping the ASX 200’s share trading volume charts, according to investing.com. 

The 3 most traded ASX 200 shares by volume this Tuesday

Telstra Group Ltd (ASX: TLS)

First up today is the ASX 200 blue chip Telstra. As it currently stands, a sizeable 21.5 million Telstra shares have changed hands this session. There’s been no news from Telstra itself for almost a week.

So it looks as though this volume is being caused by the movements of the Telstra share price itself. Telstra has had a bumpy, yet overall positive day so far. The telco is currently up a decent 0.61% at $4.10 a share after trading as high as $4.13 and as low as $4.08 earlier today.

Lynas Rare Earths Ltd (ASX: LYC)

Next, we have ASX 200 rare earths producer Lynas. So far this Tuesday, a hefty 23.35 million Lynas shares have been bought and sold on the share market. Again, there’s been nothing fresh out of Lynas itself. But this company has been under a bit of a cloud lately.

As we touched on earlier today, investors still seem a bit shaken by recent comments by Tesla CEO Elon Musk, who just came out with some insights about the future of using rare earths in electric vehicles (or lack thereof).

Lynas shares are down another 1.34% today to $7.35 a share so far and have lost more than 10% in the past week. This selling pressure probably explains the high volumes of Lynas shares trading today.

Sayona Mining Ltd (ASX: SYA)

Finally this Tuesday, we have ASX 200 lithium stock Sayona. A whopping 62.7 million Sayona shares have been traded on the share market so far this session. This isn’t a hard one to work out. Sayona has just returned from a trading halt with new plans for a capital raise.

As we went through this morning, Sayona was able to place almost 175,000 new shares at a decent premium to where the shares were halted at. This seems to have given investors confidence, with the Sayona share price up a pleasing 7.23% at 25 cents a pop right now. No wonder so many shares are zooming around.

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

• Why did the Lynas share price just hit a 52-week low?
• Owners of this ASX 200 share are soon going to receive a bigger dividend
• Why Brainchip, Lynas, Megaport, and Universal Store shares are dropping today
• Why InvoCare, Pentanet, Sayona Mining, and Weebit Nano shares are storming higher
• Megaport share price tumbles 10% on CEO resignation

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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