Investors might be wondering whether defensive ASX shares are good investments in this environment considering volatility is picking up and the possibility of a recession is rising.

In a typical recession, defensive shares can demonstrate resilient earnings and this could mean a more robust share price.

But, in this period of high inflation and rising interest rates, things may be a bit different.

Profit and the performance of the share price can sometimes vary quite dramatically. In a higher interest rate environment, investors may not value the defensive earnings of some ASX shares as much as they used to. Inflation could also hurt their earnings.

Emma Fisher from Airlie Funds Management discusses which ASX shares could be opportunities in the Australian Financial Review (AFR).

For starters, she said that investors have a better chance of making good money when markets are down. This is because it gives more potential to buy mispriced assets.

She said: “Even though it doesn’t feel as good and it doesn’t feel as comfortable as when markets are making new highs, it’s actually a better environment for stock picking.”

Time to look at defensive ASX shares?

Airlie’s Fisher is not convinced that defensive shares are an easy pick. Companies like Telstra Corporation Ltd (ASX: TLS) and Brambles Limited (ASX: BXB) were two of the names considered.

Fisher said:

If we are in a more inflationary environment than we have been historically, you want to look at the capital intensity of the business model.

So, a lot of those businesses like Telstra or Brambles, they’re spending billions of dollars a year on maintenance capex and that’s going to cost even more each year in an inflationary environment.

They’re sort of running harder to stand still and you’re paying more for them now than you did a year ago. That, to us, doesn’t scream good value.

However, the Airlie fund does have some ASX shares in the portfolio that are seen as defensive. They include Woolworths Group Ltd (ASX: WOW), Wesfarmers Ltd (ASX: WES) and CSL Limited (ASX: CSL).

The tricky thing about this investment environment is that both valuations and earnings outlooks have changed for different areas of the market.

Fisher said:

It can be tempting when you’re worried about where the cycle is going to want to hide in defensives.

The challenge you’ve got is the defensive, safe, boring part of the market has re-rated. So, you’re now facing this choice between, in some instances, eye-wateringly expensive, defensive companies and bombed-out consumer-facing businesses that look tantalisingly cheap, but where you recognise that the earnings are probably too high.

You’ve got to have a playbook for how you navigate both sides of the market.

Why do interest rates matter?

The market may view defensive ASX shares as worth a bit less right now. This is because asset values are pulled lower by higher interest rates.

Warren Buffett once described why this is the case:

The value of every business, the value of a farm, the value of an apartment house, the value of any economic asset, is 100% sensitive to interest rates because all you are doing in investing is transferring some money to somebody now in exchange for what you expect the stream of money to be, to come in over a period of time, and the higher interest rates are the less that present value is going to be. So every business by its nature … its intrinsic valuation is 100% sensitive to interest rates.

The Reserve Bank of Australia (RBA) increased interest rates by another 50 basis points today. The RBA “expects to increase interest rates further over the months ahead“. So it could continue to be a bumpy ride for ASX shares.

The post Should all ASX investors be buying defensive shares right now? appeared first on The Motley Fool Australia.

(function() {
function setButtonColorDefaults(param, property, defaultValue) {
if( !param || !param.includes(‘#’)) {
var button = document.getElementsByClassName(“pitch-snippet”)[0].getElementsByClassName(“pitch-button”)[0];
button.style[property] = defaultValue;
}
}

setButtonColorDefaults(“#43B02A”, ‘background’, ‘#5FA85D’);
setButtonColorDefaults(“#43B02A”, ‘border-color’, ‘#43A24A’);
setButtonColorDefaults(“#fff”, ‘color’, ‘#fff’);
})()

More reading

• Woolworths share price edges higher as shareholders green light MyDeal takeover
• Why is the CSL share price on the slide today?
• These 9 ASX 200 shares are going ex-dividend tomorrow
• Should you buy Telstra shares after the telco ‘comfortably turned the corner’?
• 5 things to watch on the ASX 200 on Tuesday

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 positions in and has recommended CSL Ltd. The Motley Fool Australia has positions in and has recommended Telstra Corporation Limited and Wesfarmers Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

from The Motley Fool Australia https://ift.tt/HWKEPrC

In late trade on Tuesday, the S&P/ASX 200 Index (ASX: XJO) has slipped into the red. At the time of writing, the benchmark index is down 0.35% to 6,829.5 points.

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

Karoon Energy Ltd (ASX: KAR)

The Karoon Energy share price is up 5.5% to $2.24. This follows the release of a positive update on the Bauna intervention campaign this morning. The company revealed that its second well intervention has been successful and oil production has increased strongly. Work has begun on a third well intervention.

Pilbara Minerals Ltd (ASX: PLS)

The Pilbara Minerals share price has continued its ascent and is up a further 6.5% to $3.94. A number of lithium shares are rising strongly today amid optimism over lithium demand and supply constraints. Pilbara Minerals was given a boost yesterday by a broker note out of JP Morgan. Its analysts upgraded the company’s shares to an overweight rating with an improved price target of $4.10.

Pointsbet Holdings Ltd (ASX: PBH)

The Pointsbet share price is up 2.5% to $2.23. This is despite there being no news out of the sports betting company. However, with the PointsBet share price down 37% in the space of a month, it is possible that some investors believe it has been oversold and created a buying opportunity.

Whitehaven Coal Ltd (ASX: WHC)

The Whitehaven Coal share price is up 3.5% to $8.78. Investors have been buying Whitehaven Coal and other coal miners today after coal prices charged higher. This followed news that Russia has stopped pumping gas via the Nord Stream 1 pipeline to Europe, which is likely to lead to increased demand for coal in Europe.

The post Why Karoon Energy, Pilbara Minerals, PointsBet, and Whitehaven Coal are rising appeared first on The Motley Fool Australia.

(function() {
function setButtonColorDefaults(param, property, defaultValue) {
if( !param || !param.includes(‘#’)) {
var button = document.getElementsByClassName(“pitch-snippet”)[0].getElementsByClassName(“pitch-button”)[0];
button.style[property] = defaultValue;
}
}

setButtonColorDefaults(“#0095C8”, ‘background’, ‘#5FA85D’);
setButtonColorDefaults(“#0095C8”, ‘border-color’, ‘#43A24A’);
setButtonColorDefaults(“#fff”, ‘color’, ‘#fff’);
})()

More reading

• Here are the 3 most heavily traded ASX 200 shares on Tuesday
• Why broker JP Morgan just upgraded the Pilbara Minerals share price
• How are ASX 200 energy stocks performing on Tuesday?
• Whitehaven share price surges to yet another all-time high, here’s why
• The Whitehaven share price has surged 36% in a month. Why Morgans predicts more ‘supercharged returns’

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 Pointsbet Holdings Ltd. The Motley Fool Australia has recommended Pointsbet Holdings Ltd. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

from The Motley Fool Australia https://ift.tt/SbDfVlR

The S&P/ASX 200 Materials Index (ASX: XMJ) is falling 0.43% today, but three ASX mining shares are leaping following news of mineral discoveries.

The share prices of Victory Goldfields Ltd (ASX: 1VG), ABX Group Ltd (ASX: ABX), and Gascoyne Resources Ltd (ASX: GCY) are all in the green today.

Let’s take a look at what these explorers have discovered.

Gascoyne Resources

Gascoyne shares are soaring 15% today on the back of news from the company’s Dalgaranga Gold Project in Western Australia.

Reverse Circulation drilling intercepted with thick, high-grade gold. This included 50 metres at 4.58 grams per tonne gold (g/t) from 191 metres including 24 metres at 7.3 g/t.

Managing director Simon Lawson said:

Wherever we drill to test the extends of this beast we hit more gold.

These outstanding new results clearly demonstrate that we are dealing with a wide, high-grade and potentially very large gold system at Never Never.

ABX Group

The ABx Group Ltd (ASX: ABX) share price is surging 16% today. The company announced a “major expansion” of a rare earth discovery at the Deep Leeds project in Tasmania.

Drilling assays showed the extent of rare earth elements mineralisation has expanded 230% to 4.01 square kilometres. The company has started working on a maiden REE resource estimate for the project.

Commenting on the results, CEO Dr Mark Cooksey said:

The southwest trending channel delineated by holes DL403, DL450 and DL453 has been extended 750m westwards by hole DL520 that intersected 5m thickness of ionic adsorption clay REE mineralisation averaging 2,170 ppm TREO from 3m dept.

Victory Goldfields

The Victory Goldfields share price has risen as high as 22% today. Investors are buying up the ASX mining share after drilling results showed widespread REE mineralisation. This is at the company’s wholly-owned North Stanmore Project.

Results included:

• 4 metres at 2414 parts per million (ppm) Total Rare Earth Oxide (TREO) from 28 metres
• 8 metres at 1876 ppm TREO from 24 metres
• 12 metres at 1319 ppm TREO from 24 metres.

Executive director Brendan Clark said:

Victory is very excited to confirm the significant extension of a high grade rare earth element mineralisation that now covers an area of about 1km.

The Victory Goldfields share price has since declined to be trading flat in late trading today.

The post 3 ASX mining shares leaping on mineral discoveries appeared first on The Motley Fool Australia.

(function() {
function setButtonColorDefaults(param, property, defaultValue) {
if( !param || !param.includes(‘#’)) {
var button = document.getElementsByClassName(“pitch-snippet”)[0].getElementsByClassName(“pitch-button”)[0];
button.style[property] = defaultValue;
}
}

setButtonColorDefaults(“#43B02A”, ‘background’, ‘#5FA85D’);
setButtonColorDefaults(“#43B02A”, ‘border-color’, ‘#43A24A’);
setButtonColorDefaults(“#fff”, ‘color’, ‘#fff’);
})()

More reading

• 3 ASX mining shares rocketing higher today on new finds
• Guess which ASX mining share just exploded 30% on a new gold discovery

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.

from The Motley Fool Australia https://ift.tt/pFOLjy8

What an indecisive mood the markets seem to be in today. The S&P/ASX 200 Index (ASX: XJO) has bounced around for most of the day, giving up some healthy gains that we saw this morning. At present, the ASX 200 is in the red, recording a loss of 0.29% at just over 6,830 points.

So let’s delve a little deeper into these market gyrations and examine the ASX 200 shares currently topping the market’s trading volume charts, according to investing.com.

The 3 most traded ASX 200 shares by volume this Tuesday

Incitec Pivot Ltd (ASX: IPL)

ASX 200 fertiliser and chemical manufacturer Incitec Pivot is our first share worth checking out this Tuesday. So far today, a sizeable 14.01 million Incitec shares have been bought and sold on the share market. This could be related to the investor presentation the company released to the markets this morning.

Investors don’t seem to approve of what was discussed though. The Incitec Pivot share price has tanked a chunky 2.74% today to $3.725 a share. It’s probably this selloff that has prompted the elevated volumes we are seeing.

Core Lithium Ltd (ASX: CXO)

Next up is ASX 200 lithium stock Core Lithium. As it currently stands, a notable 20.22 million Core Lithium shares have traded on the markets. There hasn’t been much in the way of news out from Core Lithium today.

However, as my Fool colleague Brooke looked at this afternoon, several positive developments in recent months have proven very lucrative for the Core Lithium share price.

The company is up a whopping 8.82% today so far to $1.48 a share, which puts Core’s gains at almost 10% over the past five trading days. It’s almost certainly this gain today that has resulted in the volumes we see.

Pilbara Minerals Ltd (ASX: PLS)

Finally today, we have another ASX 200 lithium share in Pilbara Minerals. This Tuesday has seen a hefty 25.28 million Pilbara shares fly around the ASX. There hasn’t been any news out of Pilbara either.

However, as we also looked at this afternoon, ASX broker JP Morgan has come out with an upgrade for Pilbara shares. The broker gave the company an outperform rating and boosted its 12-month share price target by 17% to $4.10.

Investors could have taken this to heart, given the Pilbara share price has gained a robust 6.49% to $3.94 a share. It could be a combination of these events that has led to the high volumes we are witnessing.

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

(function() {
function setButtonColorDefaults(param, property, defaultValue) {
if( !param || !param.includes(‘#’)) {
var button = document.getElementsByClassName(“pitch-snippet”)[0].getElementsByClassName(“pitch-button”)[0];
button.style[property] = defaultValue;
}
}

setButtonColorDefaults(“#43B02A”, ‘background’, ‘#5FA85D’);
setButtonColorDefaults(“#43B02A”, ‘border-color’, ‘#43A24A’);
setButtonColorDefaults(“#fff”, ‘color’, ‘#fff’);
})()

More reading

• Why is the Core Lithium share price surging 8% on Tuesday?
• Why broker JP Morgan just upgraded the Pilbara Minerals share price
• Here are the top 10 ASX 200 shares today
• Leading brokers name 3 ASX shares to buy today
• Here are the 3 most heavily traded ASX 200 shares on Monday

JPMorgan Chase is an advertising partner of The Ascent, a Motley Fool company. Motley Fool contributor Sebastian Bowen has positions in JPMorgan Chase. 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.

from The Motley Fool Australia https://ift.tt/6tn5rsd

The Tyranna Resources Ltd (ASX: TYX) share price is rocketing on Tuesday, shooting out of the blocks from the open this morning.

Shares of the diversified minerals company currently trade for 4.3 cents each, a gain of 26.47% on the day.

It’s a much better performance than the S&P/ASX 200 Materials Index (ASX: XMJ) — it’s down 0.11% at the time of writing.

In fact, Tyranna shares have been on a hot run since May, reaping a 529% year-to-date return.

Let’s see what’s going on.

What happened?

There’s no news from the company today to make sense of the surge in the Tyranna share price.

However, momentum could be carried forward from 22 August when the company announced “outstanding results” from its Namibe lithium project in Angola, Africa.

The results came from assays (composition and quality analysis) from 50 rock-chip samples collected from the site in July.

Tyranna notes that half the samples contained spodumene. The rock chips contained also contained a high average concentration of lithium oxide at 3.21%.

Overall, the company notes this confirms that significant lithium mineralisation exists at its Namibe site and that it will explore previously untapped deposits.

Tyranna executive director Paul Willams said:

We are very excited by these results which provide further encouragement and confirmation that the Namibe Lithium Project contains substantial high grade spodumene mineralisation and justifies Tyranna’s acquisition of what is proving to be a valuable project. We have defined a larger drill-target area at the site known as 21n, and these results in particular provide further confidence in designing our maiden drilling program. We are looking forward to the next phase of exploration to test these areas at depth.

Tyranna Resources share price snapshot

The Tyranna share price is up 57% over the past month. By comparison, the Materials Index is down 2.37% over the same period while the S&P/ASX 200 Index (ASX: XJO) is 2.56% lower.

The company’s market capitalisation is around $98 million.

The post Why is ASX lithium share Tyranna rocketing 26% today? appeared first on The Motley Fool Australia.

(function() {
function setButtonColorDefaults(param, property, defaultValue) {
if( !param || !param.includes(‘#’)) {
var button = document.getElementsByClassName(“pitch-snippet”)[0].getElementsByClassName(“pitch-button”)[0];
button.style[property] = defaultValue;
}
}

setButtonColorDefaults(“#43B02A”, ‘background’, ‘#5FA85D’);
setButtonColorDefaults(“#43B02A”, ‘border-color’, ‘#43A24A’);
setButtonColorDefaults(“#fff”, ‘color’, ‘#fff’);
})()

More reading

• ASX 200 shares dip as RBA boosts interest rates by another 0.50%
• Does the iShares S&P 500 ETF (IVV) pay dividends?
• Woolworths share price edges higher as shareholders green light MyDeal takeover
• ‘We would like to see faster progress’: ASX 200 energy shares on notice
• 3 reasons to invest in Ethereum right now

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.

from The Motley Fool Australia https://ift.tt/sqZYThH

The Reserve Bank of Australia (RBA) announced a 0.50% increase in interest rates on Tuesday afternoon. That brings Australia’s benchmark cash rate to 2.35%.

This marks the fifth consecutive month of rate hikes from the central bank.

The RBA began tightening its policies on 4 May, when it raised rates from the historic low of 0.10% to a still quite modest 0.25%. That marked the first increase in interest rates since November 2010. At that time, the central bank raised the official cash rate by 0.25% to 4.75%.

Today, the RBA board also increased the interest rate on Exchange Settlement balances by 0.50% to 2.25%.

S&P/ASX 200 Index (ASX: XJO) shares had fallen 0.50% since this morning in the lead up to the central bank’s announcement at 2:30pm AEST. Since the announcement, ASX 200 shares have dipped another 0.1%, suggesting the market had broadly priced in the rate hike.

Why another interest rate hike from the RBA?

The RBA is determined to bring inflation back to its target rate of 2% to 3% “over time”.

The latest quarterly inflation figures came in at 6.1%. And that number is expected to peak higher by the end of the year before beginning to trend lower.

According to RBA governor Philip Lowe:

Inflation in Australia is the highest it has been since the early 1990s and is expected to increase further over the months ahead. Global factors explain much of the increase in inflation, but domestic factors are also playing a role. There are widespread upward pressures on prices from strong demand, a tight labour market and capacity constraints in some sectors of the economy.

Lowe said the bank expects inflation to begin falling, driven lower by the “ongoing resolution of global supply-side problems, recent declines in some commodity prices and the impact of rising interest rates”.

The RBA’s central forecast for CPI inflation is around 7.75% for 2022, “a little above” 4% over 2023 and around 3% in 2024.

Tight labour markets see wages beginning to rise

Lowe pointed to tight labour markets beginning to fuel wage growth. This could add to inflationary pressures as companies may then pass these costs on.

“Wages growth has picked up from the low rates of recent years and there are some pockets where labour costs are increasing briskly,” he said.

July’s unemployment rate dipped to 3.4%, the lowest in half a century.

The behaviour of household spending in the months ahead remains “an important source of uncertainty”.

On one side of the ledger, Australians have more job opportunities, rising salaries, and greater household savings levels accrued during the pandemic restrictions.

On the other side of that ledger, Lowe said, “Higher inflation and higher interest rates are putting pressure on household budgets, with the full effects of higher interest rates yet to be felt in mortgage payments.”

What’s next for RBA interest rate policies?

Looking ahead, Lowe said:

Price stability is a prerequisite for a strong economy and a sustained period of full employment. The Board expects to increase interest rates further over the months ahead, but it is not on a pre-set path.

The post ASX 200 shares dip as RBA boosts interest rates by another 0.50% appeared first on The Motley Fool Australia.

(function() {
function setButtonColorDefaults(param, property, defaultValue) {
if( !param || !param.includes(‘#’)) {
var button = document.getElementsByClassName(“pitch-snippet”)[0].getElementsByClassName(“pitch-button”)[0];
button.style[property] = defaultValue;
}
}

setButtonColorDefaults(“#0095C8”, ‘background’, ‘#5FA85D’);
setButtonColorDefaults(“#0095C8”, ‘border-color’, ‘#43A24A’);
setButtonColorDefaults(“#fff”, ‘color’, ‘#fff’);
})()

More reading

• Does the iShares S&P 500 ETF (IVV) pay dividends?
• Woolworths share price edges higher as shareholders green light MyDeal takeover
• ‘We would like to see faster progress’: ASX 200 energy shares on notice
• 3 reasons to invest in Ethereum right now
• Why is the Core Lithium share price surging 8% on Tuesday?

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.

from The Motley Fool Australia https://ift.tt/cVTYCpZ

When it comes to exchange-traded funds (ETFs) on the ASX, the iShares S&P 500 ETF (ASX: IVV) is certainly a heavy hitter. It’s not quite the most popular ETF on the ASX. That honour goes to the Vanguard Australian Shares Index ETF (ASX: VAS).

But the iShares S&P 500 ETF is the most popular ETF on the ASX that covers international shares. It even beats out the Vanguard MSCI International Shares Index ETF (ASX: VGS).

There’s little doubt that, apart from some good old-fashioned home bias, investors that prefer ASX share-based ETFs enjoy the higher dividends, and franking, that come with them. But what of the S&P 500 ETF?

Well, investors in this ETF also enjoy dividend returns. For an index ETF to be able to pay out dividends, the underlying shares that the ETF owns must also pay out dividends.

The iShares S&P 500 ETF covers the largest 500 companies listed on the United States markets. And many of these companies (though not all) do pay out dividends to their investors. As such, so does the ETF that tracks them.

Which US shares in the S&P 500 ETF pay dividends?

Let’s check out some of this fund’s top holdings to illustrate. On the latest figures, the S&P 500 ETF’s top 10 holdings are:

1. Apple Inc (NASDAQ: AAPL)
2. Microsoft Corporation (NASDAQ: MSFT)
3. Alphabet Inc (NASDAQ: GOOG)(NASDAQ: GOOGL)
4. Amazon.com Inc (NASDAQ: AMZN)
5. Tesla Inc (NASDAQ: TSLA)
6. Berkshire Hathaway Inc (NYSE: BRK.A)(NYSE: BRK.B)
7. UnitedHealth Group Inc (NYSE: UNH)
8. Johnson & Johnson (NYSE: JNJ)
9. Exxon Mobil Corp (NYSE: XOM)
10. Meta Platforms Inc (NASDAQ: META).

Now, several of these shares do not pay dividends. Those are Alphabet, Meta, Amazon, Tesla, and (famously) Berkshire Hathaway.

But Apple, Microsoft, UnitedHealth, Johnson & Johnson, and Exxon, do. As do many other stalwarts of the S&P 500, such as Coca-Cola Co, Procter & Gamble Co, Visa Inc, and McDonald’s Corp.

So yes, since the S&P 500 ETF receives these dividends from holding these stocks, it passes them on in the form of dividend distributions.

So what are these dividend distributions worth? Well, this ETF pays out its income every three months. Its last four dividend distributions, covering the previous 12 months, came to a total of $7.43 per unit.

On the current unit price of $580.57 for the iShares S&P 500 ETF, it has a trailing distribution yield of 1.28%.

That might not be as high as the Vanguard Australian Shares ETF. But it certainly does qualify the iShares S&P 500 ETF as a dividend-paying fund.

The iShares S&P 500 ETF charges a management fee of 0.04% per annum.

The post Does the iShares S&P 500 ETF (IVV) pay dividends? appeared first on The Motley Fool Australia.

(function() {
function setButtonColorDefaults(param, property, defaultValue) {
if( !param || !param.includes(‘#’)) {
var button = document.getElementsByClassName(“pitch-snippet”)[0].getElementsByClassName(“pitch-button”)[0];
button.style[property] = defaultValue;
}
}

setButtonColorDefaults(“#43B02A”, ‘background’, ‘#5FA85D’);
setButtonColorDefaults(“#43B02A”, ‘border-color’, ‘#43A24A’);
setButtonColorDefaults(“#fff”, ‘color’, ‘#fff’);
})()

More reading

• 3 quality ETFs for ASX investors in September
• How does VGS stack up against other ASX index funds?
• Here’s why the iShares S&P 500 ETF (IVV) has climbed 7% in a month
• 3 top ETFs for ASX investors to buy next week

Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to Meta Platforms CEO Mark Zuckerberg, is a member of The Motley Fool’s board of directors. Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. Motley Fool contributor Sebastian Bowen has positions in Alphabet (A shares), Apple, Coca-Cola, Johnson & Johnson, McDonald’s, Meta Platforms, Inc., Microsoft, Procter & Gamble, Tesla, and Visa. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Alphabet (A shares), Alphabet (C shares), Apple, Meta Platforms, Inc., Microsoft, Tesla, Vanguard MSCI Index International Shares ETF, and Visa. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended Johnson & Johnson and UnitedHealth Group and has recommended the following options: long January 2024 $47.50 calls on Coca-Cola, long March 2023 $120 calls on Apple, and short March 2023 $130 calls on Apple. The Motley Fool Australia has recommended Alphabet (A shares), Alphabet (C shares), Apple, Meta Platforms, Inc., Vanguard MSCI Index International Shares 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.

from The Motley Fool Australia https://ift.tt/iXrvzP1

The Woolworths Group Ltd (ASX: WOW) share price is edging higher on Tuesday.

In afternoon trade, the retail giant’s shares are up slightly to $37.10.

Why is the Woolworths share price edging higher?

While the Woolworths share price has been up and down all day, it was given a little lift by an announcement after lunch.

That announcement reveals that Mydeal.com Au Ltd (ASX: MYD) has completed its shareholder vote relating to being acquired by Woolworths.

According to the release, shareholders have voted overwhelmingly in favour of the $1.05 cash per share deal.

A total of 99.89% of the votes cast by scheme shareholders were in favour of the $243 million transaction, which will see Woolworths acquire an 80% stake. The remaining 20% will be retained by MyDeal’s founder and CEO, Sean Senvirtne, along with certain other key management shareholders.

With ACCC approval already granted, the deal now looks set to close successfully next week on 14 September before being implemented on 23 September.

Why is Woolworths acquiring MyDeal?

Woolworths hasn’t commented on the deal today, but has previously explained that it sees the acquisition as a way to enhance its marketplace capabilities. It said:

MyDeal will enhance Woolworths Group’s marketplace capabilities, particularly in furniture, homewares and other bulky goods. It will complement BIG W’s existing general merchandise offer and is consistent with Woolworths Group’s strategy to ‘Connect our customers with Good Food and More Everyday’. For MyDeal, access to Woolworths Group’s platforms and capabilities will support its continued growth.

Woolworths’ CEO, Brad Banducci, added:

The addition of MyDeal to Woolworths Group represents a further step towards delivering a more holistic customer experience in food and everyday needs and materially expands our marketplace capabilities, especially in general merchandise.

The post Woolworths share price edges higher as shareholders green light MyDeal takeover appeared first on The Motley Fool Australia.

(function() {
function setButtonColorDefaults(param, property, defaultValue) {
if( !param || !param.includes(‘#’)) {
var button = document.getElementsByClassName(“pitch-snippet”)[0].getElementsByClassName(“pitch-button”)[0];
button.style[property] = defaultValue;
}
}

setButtonColorDefaults(“#0095C8”, ‘background’, ‘#5FA85D’);
setButtonColorDefaults(“#0095C8”, ‘border-color’, ‘#43A24A’);
setButtonColorDefaults(“#fff”, ‘color’, ‘#fff’);
})()

More reading

• Are Woolworths shares good value in September?
• Goldman Sachs says these ASX dividend shares are buys
• Here are the top 10 ASX 200 shares today
• Is the Endeavour share price a bargain after its big tumble in August?
• How did ASX 200 dividend shares stack up in August?

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.

from The Motley Fool Australia https://ift.tt/lB4kXUr

Four of the S&P/ASX 200 Index (ASX: XJO)’s biggest energy shares – AGL Energy Limited (ASX: AGL), Origin Energy Ltd (ASX: ORG), Santos Ltd (ASX: STO), and Woodside Energy Group Ltd (ASX: WDS) – have been put on notice by HESTA.

The $68 billion superannuation monolith has a new target to slash emissions by 50% across its portfolio by 2030.

To get there, it’s demanding that the energy giants show that their climate change strategies align with the Paris Agreement goals. They may be dumped from the fund’s portfolio if they fail to meet its objectives.

The S&P/ASX 200 Energy Index (ASX: XEJ) is trading in the green today, gaining 0.27%. Meanwhile, the ASX 200 is up 0.18%.

Looking to the four stocks put on HESTA’s watchlist, the Santos share price is in the lead, having slipped 0.06%.

The Woodside share price is coming in next best, falling 0.3%, while shares in AGL and Origin are down 1.5% and 2% respectively.

Let’s take a closer look at the super fund’s latest move towards net zero.

HESTA issues warning to ASX 200 energy shares

HESTA has lifted its interim emissions reduction target to 50% by 2030, up from 33%, across its portfolio on a 2020 baseline. That will see it well on the way to achieving its net zero emissions target by 2050.

The fund has also written to the chairs of four ASX 200 energy shares found to be facing “significant decarbonisation challenges”. It’s concerned with disparities between the companies’ strategic targets and a 1.5 degree Celsius transition pathway.

The four stocks will now face closer engagement and monitoring by the fund. It has asked Origin, Santos, and Woodside how final investment decisions on major projects align with a 1.5 degrees Celsius pathway.

HESTA’s framework also considers voting against ‘say on climate’ resolutions and directors’ elections, and supporting or filing shareholder resolutions. It also allows for divestment where there’s a lack of evidence of addressing risks, and it’s in members’ best financial interests.

HESTA invests around $720 million in the four ASX 200 shares, the Australian Financial Review (AFR) reports.

Speaking to the publication, HESTA CEO Debby Blakey said:

We would like to see faster progress … There’s some incredible information as to this being the decade where we have to act.

HESTA voted against the climate plans of Santos and Woodside in May this year. It also took on the lead engager role through Climate Action 100+ as part of its escalation with AGL.

The fund already excludes companies dependent on thermal coal. That includes ASX 200 share Whitehaven Coal Ltd (ASX: WHC), which is currently trading at a record high.

The post ‘We would like to see faster progress’: ASX 200 energy shares on notice appeared first on The Motley Fool Australia.

(function() {
function setButtonColorDefaults(param, property, defaultValue) {
if( !param || !param.includes(‘#’)) {
var button = document.getElementsByClassName(“pitch-snippet”)[0].getElementsByClassName(“pitch-button”)[0];
button.style[property] = defaultValue;
}
}

setButtonColorDefaults(“#43B02A”, ‘background’, ‘#5FA85D’);
setButtonColorDefaults(“#43B02A”, ‘border-color’, ‘#43A24A’);
setButtonColorDefaults(“#fff”, ‘color’, ‘#fff’);
})()

More reading

• The Woodside share price has gained under 5% in 10 years. Does the latest monster dividend make up for this?
• How are ASX 200 energy stocks performing on Tuesday?
• 5 things to watch on the ASX 200 on Tuesday
• Here are the top 10 ASX 200 shares today
• Why is the Woodside share price surging ahead on Monday?

Motley Fool contributor Brooke Cooper has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has 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.

from The Motley Fool Australia https://ift.tt/Fvn1Kcr

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

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

There are thousands of cryptocurrencies out there, but few can match the ecosystem or activity of Ethereum (CRYPTO: ETH). With a market cap approaching $190 billion, Ethereum trails only Bitcoin (CRYPTO: BTC) in terms of market value, and it is by far the largest smart contract platform in the world. Here are three top reasons all investors should consider getting some exposure to Ethereum. 

Ethereum has a deep ecosystem 

Neil Patel: Launched in 2015, Ethereum is the world’s first functional blockchain, allowing the ability for smart contracts to be built on top of the network. Smart contracts are computer programs that execute automatically when two unrelated parties meet the conditions of a particular transaction. The need for middlemen is completely eliminated. For example, think of collateral that becomes unencumbered once a loan is fully repaid. All of this is possible thanks to software called the Ethereum Virtual Machine, which runs these smart contracts. 

This setup differs completely from Bitcoin, which was created with the sole purpose of being a peer-to-peer digital cash system. And unsurprisingly, it’s why Ethereum has attracted the most engineers and computer scientists working on expanding the platform. According to venture capital firm Electric Capital, at the end of 2021, there were more than 4,000 monthly active developers working on Ethereum, with 20% of new Web3 developers joining this blockchain. That’s a significant share. 

As a result, Ethereum now has the biggest ecosystem of decentralized applications (dApps) compared to any other cryptocurrency out there. There are nearly 3,000 dApps running on Ethereum, according to the non-profit crypto directory State of the DApps. They can have various use cases ranging from decentralized finance protocols and gaming to social media and marketplaces for non-fungible tokens. And although the overall market has taken a beating in 2022, $36.5 million in dApp transaction volume occurred on Ethereum over the past 24 hours (as of this writing). 

The incredibly deep ecosystem surrounding Ethereum increases its chances of continuing to create real-world utility and greater user adoption over time. And that’s a compelling reason to buy this cryptocurrency and hold it for the long haul.

Ethereum is about to get even better

RJ Fulton: Out of the plethora of reasons crypto investors should make sure they own some Ethereum, arguably the most compelling one happens to be an event scheduled for launch in just a few weeks. The date isn’t concrete, but sometime between Sept.16 and Sept. 20, Ethereum will be transitioning from the slow, energy-intensive proof-of-work consensus mechanism to a faster, more efficient proof-of-stake consensus mechanism known as the Merge. It’s estimated that the blockchain will use 99% less energy once fully moved over to proof of stake.

It could be a bit of a stretch, but the Merge is arguably one of the most significant events to occur in cryptocurrency history. When considering that the Merge has been under development for the greater part of eight years and now finally has an end in sight, it’s a little difficult to fully grasp that this highly anticipated day is just around the corner.

Once The Merge is fully rolled out, the hope is that Ethereum will become more conducive to the development of applications. On the current proof-of-work mechanism, network fees are high and speeds can be slow, which hampers the efforts of smart-contract developers.

Ethereum’s price skyrocketed over the last two and a half years primarily due to the widespread popularity of the blockchain as the favorite for developers using Ethereum’s smart contracts to build DeFi applications. But that increased popularity has made the network congested and costly to use, warranting a necessary change from proof of work. When Ethereum transitions to proof of stake, the blockchain should be able to support more applications without sacrificing speeds or costs, which will hopefully bring even more utility to the network and greater returns for investors. 

In anticipation of the Merge, it seems as though Ethereum’s popularity is still continuing to escalate. Since the beginning of 2022, Ethereum has added 142,000 validators representing more than a 50% increase. Furthermore, it looks like more users are creating Ethereum-compatible wallets. In just eight months, more than 20 million new wallet addresses were created.

If Ethereum was able to put in a more than 1000% return since 2020 on the clunky proof-of-work consensus mechanism, imagine the long-term value Ethereum will hold once it fully transitions to the streamlined proof-of-stake mechanism. 

Ethereum is still the king of NFTs 

Michael Byrne: While blockchains like Solana (CRYPTO: SOL) and Polygon (CRYPTO: MATIC) have been gaining traction in the world of non-fungible tokens (NFTs), Ethereum is still the 800-pound gorilla in the room when it comes to NFTs. Data from CryptoSlam, an aggregator for NFT data, shows that Ethereum’s all-time NFT sales volume dwarfs those of all other blockchains. Ethereum NFTs have accounted for over $29 billion in sales all time, compared to about $4 billion for the runner-up, Ronin (CRYPTO: RON) (which is almost entirely comprised of Axie Infinity sales), $2.5 billion for Solana, and nearly $1.1 billion for Flow (CRYPTO: FLOW), which is mainly thanks to NBA Top Shot).

While NFT sales on Ronin or Flow are more or less dominated by one high-profile project, Ethereum boasts a deep and well-diversified NFT marketplace, with 11 different collections that have generated over $500 million in sales volume since inception. As the original blockchain that introduced smart contracts to the world and enabled the advent of NFTs, NFTs on Ethereum have a cache that other blockchains have yet to match, and individual pieces from collections like CryptoPunks and Bored Ape Yacht Club have routinely sold for hundreds of thousands of dollars or more. These two collections have a collective value of nearly $3 billion.

Ethereum NFTs have created a large ecosystem of their own. NFT marketplace OpenSea, which originally was exclusively for Ethereum NFTs, was valued at $13 billion in its most recent funding round. Magic Eden, which was previously exclusively for Solana NFTs, achieved unicorn status with a $1.6 billion valuation in its last funding round and recently added Ethereum NFTs to its platform. If you are bullish about the growth of NFTs, Ethereum is a must-own.

With a rich ecosystem, a major upgrade on deck in the form of the Merge, and a dominant position in NFTs, Ethereum is worth a look for all investors. 

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

The post 3 reasons to invest in Ethereum right now appeared first on The Motley Fool Australia.

(function() { function setButtonColorDefaults(param, property, defaultValue) { if( !param || !param.includes(‘#’)) { var button = document.getElementsByClassName(“pitch-snippet”)[0].getElementsByClassName(“pitch-button”)[0]; button.style[property] = defaultValue; } } setButtonColorDefaults(“#0095C8”, ‘background’, ‘#5FA85D’); setButtonColorDefaults(“#0095C8”, ‘border-color’, ‘#43A24A’); setButtonColorDefaults(“#fff”, ‘color’, ‘#fff’); })()

More reading

• Will Ethereum still be a buy after the merge?
• Is El Salvador’s great Bitcoin experiment fizzling or just getting started?
• September could be a crucial month for these 2 cryptocurrencies
• Ethereum Merge first stage set for tomorrow. What can crypto investors expect next?
• Why did the Dogecoin price tumble 12% in August?

Michael Byrne has positions in Bitcoin, Ethereum, and Solana. Neil Patel has positions in Bitcoin and Ethereum. RJ Fulton has positions in Bitcoin, Ethereum, and Solana. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Bitcoin, Ethereum, Polygon, and Solana. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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

from The Motley Fool Australia https://ift.tt/mGelqvE