The S&P/ASX 200 Index (ASX: XJO) closed well into the green yesterday, up 1%.

Still the ASX 200 remains down more than 7% since the opening bell on 4 January.

The initial slide was largely fuelled by investor fears over fast rising inflation. That came with the realisation that Reserve Bank of Australia (RBA) could be lifting the official cash rate from the historic low 0.10% a lot sooner than the central bank had forecast at the end of 2021.

Higher interest rates can put pressure on share markets, as the cost of money essentially goes up.

This saw the ASX 200 fall 8.2% in January.

Tech shares were particularly hard hit. Many tech shares are priced with distant future earnings in mind. Hence the 17.1% decline in the S&P/ASX All Technology Index (ASX: XTX) in January.

Things briefly began to tick higher from there.

Until, as you’re aware, Russia first massed its troops around Ukraine and then invaded in an all-out assault.

Atop the horrific human toll, Russia’s invasion has sent commodity prices soaring, with many trading at all-time highs. Brent crude oil topped US$130 per barrel overnight.

And that could accelerate the pace at which ASX investors can expect the first RBA rate rise from governor Philip Lowe.

Can ASX investors expect higher rates this year?

Speaking at The Australian Financial Review Business Summit in Sydney, Lowe pointed out that inflation in Australia remains well below that witnessed in the United States and many other developed nations.

The RBA governor appeared in no hurry to increase the cash rate, noting that moving too soon could impact the strongly rebounding labour market. And he’s not yet convinced that inflation will sustainably run ahead of the RBA’s 2–3% target range.

According to Lowe (quoted by the AFR):

The Reserve Bank will respond as needed and do what is necessary to maintain low and stable inflation in Australia… Australia has the opportunity to secure a lower rate of unemployment than has been the case for some decades. Moving too early could put this at risk. The recent lift in inflation has brought us closer to the point where inflation is sustainably in the target range. So, too, have recent global developments. But we are not yet at that point.

Lowe said that while the RBA believes headline inflation will run higher than 4%, it remained unclear how long that might last. “We can afford to look through a period of temporarily high inflation because of higher oil prices and commodity price shocks if we think that they will eventually wash through,” he said.

“There is a risk if these higher inflation rates are sustained as a result of a sequence of negative supply shocks, that wages growth picks up more quickly than forecast as workers seek compensation for the higher inflation,” Lowe added.

In his formal remarks, Lowe left open the door for a higher cash rate in 2022:

In this uncertain environment – and with the starting points for wages growth and underlying inflation in Australia – we can take the time to assess the incoming information and review how the uncertainties are resolved. Given the outlook, though, it is plausible that the cash rate will be increased later this year.

What the economists are saying

While Lowe sounded a somewhat dovish tone, many leading economists are forecasting ASX shares could be impacted (some negatively, others positively) by rising rates as early as June. With more rate rises likely to follow in 2022 alone.

Among them, Commonwealth Bank of Australia (ASX: CBA) head of Australian economics, Gareth Aird and his team are expecting the RBA to make its first rate lift in June.

Last month, before Russia launched its war in Ukraine, Aird said:

We are very comfortable with our expectation that the Q1 2022 underlying inflation data will be a lot stronger than the RBA’s forecast. If the Q1 2022 CPI prints in line with our forecast, the RBA will not need an additional CPI to conclude that inflation is ‘sustainably within the target range’. The RBA will simply need to be satisfied that wages growth is moving towards the desired levels.

On the outlook for inflation down under, AMP Capital Markets economist, Diana Mousina said:

In Australia, the total inflation impact from the Russia/Ukraine war and the floods will add 0.5 percentage points to March quarter headline inflation and 0.2 percentage points in the June quarter from lingering high commodity prices. This means that we expect annual headline inflation growth of just over 5% in June and around 4.5% over the year to December.

Now all this doesn’t mean it’s time to panic.

ASX shares have weathered rising rates before. And over the long-term most of them have come out just fine. As have their shareholders.

But with rising rates looming on the horizon, ASX investors may wish to run the slide rule over their specific holdings.

The post Should ASX investors brace for higher interest rates in 2022? appeared first on The Motley Fool Australia.

More reading

• Warning: Only 4 ASX shares just added to ASX 300 are profitable
• Is the Nickel Mines (ASX:NIC) share price chaos a buying opportunity?
• 5 things to watch on the ASX 200 on Thursday
• 3 blue chip ASX 200 shares analysts are tipping as buys
• Is this still the dawning of the age of ASX commodity shares?

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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It was a wild day for the Nickel Mines Ltd (ASX: NIC) share price on Wednesday.

As I mentioned here at lunch yesterday, the nickel producer’s shares were sold down by almost 23% amid concerns over one of its largest customers and shareholders, Xiang Guangda of steel maker Tsingshan, getting caught up in a massive short squeeze after the nickel price rocketed to US$100,000 a tonne.

This sparked fears over the solvency of Tsingshan and the impact this could have on agreements and its shareholdings.

Better late than never, Nickel Mines eventually came out with an announcement in the afternoon advising that the company has spoken to Tsingshan. It revealed that it was business as usual and its largest shareholder had no plans to sell shares.

This led to the Nickel Mines share price paring the majority of its decline to end the day 4.5% lower at $1.41.

Is the Nickel Mines share price chaos a buying opportunity?

According to a notes out of Bell Potter, its analysts believe investors should you this recent volatility to their advantage.

This morning the broker has reiterated its buy rating and $1.76 price target on the company’s shares.

Based on the current Nickel Mines share price, this implies potential upside of almost 25% over the next 12 months and over 29% if you include its 4.3% dividend yield.

What did the broker say?

Bell Potter gave its take on recent developments.

It said: “NIC entered and subsequently exited a Trading Halt on Wednesday 9 March, following a 23% drop in its share price in morning trade on the ASX. This resulted from speculation around the possible implications for Tsingshan Holding Group (a private company), the world’s largest stainless steel producer and parent company of Shanghai Decent Investment (SDI). SDI is NIC’s largest shareholder (17.9%) and partner in the Indonesian Morowali Industrial Park (IMIP) and Indonesia Weda Bay Industrial Park (IWIP), where NIC’s Nickel Pig Iron (NPI) operations are hosted.”

“According to reports, Tsingshan held a 200kt nickel short position, struck at US$21,000/t. Following the suspension and cancellation of LME nickel trades for Tuesday 8th March, the mark-to-market valuation of the position, calculated on Monday’s cash closing price of US$48,200/t, was ~US$7.4 billion. Market concerns related to the solvency of Tsingshan, the status of operations and development at the IWIP and IWIP and the potential forced sale of SDI’s shareholding in NIC,” the broker added.

But Bell Potter isn’t concerned by any of the above. In fact, it believes it is likely to that “Tsingshan (annual revenues US$56 billion and regarded as the world’s lowest cost stainless steel producer) will close out its short position, supported by physical delivery, without compromising its long-term financial viability.”

All in all, the broker believes this is an opportunity for investors to buy a nickel producer with strong earnings growth potential in the near term.

It concludes: “We view NIC’s steep price drop as an acquisition opportunity. We continue to forecast aggressive EPS growth of 82% and 85% for FY22 and FY23 and we retain our Buy recommendation.”

The post Is the Nickel Mines (ASX:NIC) share price chaos a buying opportunity? appeared first on The Motley Fool Australia.

More reading

• 5 things to watch on the ASX 200 on Thursday
• Is this still the dawning of the age of ASX commodity shares?
• What happened to the Nickel Mines (ASX:NIC) share price today?
• 3 under-the-radar commodity prices soaring since the Ukraine crisis
• Here are the 3 most heavily traded ASX 200 shares this Wednesday

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 Bruce Jackson.

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On Wednesday, the S&P/ASX 200 Index (ASX: XJO) had a strong day and stormed higher. The benchmark index rose 1% to 7,053 points.

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

ASX 200 expected to rise

The Australian share market looks set to rise again on Thursday following a stunning night on Wall Street. According to the latest SPI futures, the ASX 200 is expected to open the day 16 points or 0.2% higher this morning. In late trade on Wall Street, the Dow Jones is up 2%, the S&P 500 is up 2.6%, and the Nasdaq has risen 3.4%. Falling oil prices have boosted equities.

Rio Tinto shares go ex-dividend

The Rio Tinto Limited (ASX: RIO) share price is likely to trade sharply lower today. This is because the mining giant’s shares are trading ex-dividend this morning for its enormous $6.63 per share fully franked final dividend. Eligible shareholders can then look forward to receiving this payout next month on 21 April. South32 Ltd (ASX: S32) shares may also trade lower for the same reason.

Oil prices sink

It could be a very difficult day for energy shares including Santos Ltd (ASX: STO) and Woodside Petroleum Limited (ASX: WPL) after oil prices sank overnight. According to Bloomberg, the WTI crude oil price is down 12.8% to US$107.64 a barrel and the Brent crude oil price is down 14.2% to US$109.83 a barrel. This follows indications that the US is making progress in encouraging more oil production from other sources, such as Iraq and UAE.

Nickel Mines rated as a buy

The Nickel Mines Ltd (ASX: NIC) share price could be great value according to the team at Bell Potter. Its analysts believe recent weakness has created an opportunity for investors and has reiterated its buy rating and $1.76 price target. This follows confirmation that agreements and the shareholding of major customer and shareholder, Tsingshan, will not be impacted by the nickel short squeeze. Bell Potter estimates that Tsingshan could be down by as much as US$7.4 billion on its trade.

Gold price tumbles

It could be a difficult day for gold miners Evolution Mining Ltd (ASX: EVN) and Regis Resources Limited (ASX: RRL) after the gold price tumbled. According to CNBC, the spot gold price is down 2.7% to US$1,987.7 an ounce. The precious metal came under pressure after investors moved back into risk assets.

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

More reading

• Is this still the dawning of the age of ASX commodity shares?
• Record $36bn in dividends could help ASX share market recovery
• What happened to the Nickel Mines (ASX:NIC) share price today?
• Here are the top 10 ASX shares today
• 3 under-the-radar commodity prices soaring since the Ukraine crisis

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 Bruce Jackson.

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Investors that are looking for some new shares to buy might want to look at the blue chips listed below.

These three blue chip ASX 200 shares have been tipped to climb notably higher from where they trade today. Here’s what you have to know about them:

Goodman Group (ASX: GMG)

The first blue chip ASX 200 share that could be in the buy zone is Goodman. It is a global integrated commercial and industrial property company with a world class property portfolio. These properties have exposure to key growth markets such as ecommerce and logistics and are in high demand from tenants such as Amazon and DHL. Thanks to this strong demand and its huge development pipeline, Goodman has been tipped to continue its strong growth long into the future. Citi is one of many brokers that is positive on its future. Its analysts currently have a buy rating and $29.50 price target on its shares.

Wesfarmers Ltd (ASX: WES)

Another blue chip ASX 200 share to consider is Wesfarmers. It is the conglomerate behind brands such as Bunnings, Kmart, and Officeworks. In addition, the company owns a collection of industrial businesses and is in the process of acquiring Priceline pharmacy chain operator Australian Pharmaceutical Industries Ltd (ASX: API). While trading conditions are on the tough side in FY 2022, analysts at Morgans believe it is worth sticking with the company due to its positive long term outlook. The broker currently has an add rating and $58.50 price target on Wesfarmers’ shares.

Westpac Banking Corp (ASX: WBC)

A final blue chip ASX 200 share that could be in the buy zone is Westpac. This banking giant’s shares have fallen heavily over the last six months amid concerns over its margins and the viability of its cost cutting plans. The team at Morgans aren’t concerned by either. The broker believes the challenges facing Westpac are not unsurmountable. As a result, it feels the recent share price weakness is a buying opportunity for investors and has put an add rating and $29.50 price target on its shares.

The post 3 blue chip ASX 200 shares analysts are tipping as buys appeared first on The Motley Fool Australia.

More reading

• What’s the difference between lithium hydroxide and spodumene and which ASX shares are involved with each one?
• ANZ has the largest ASX big four bank dividend yield right now. What?
• Broker names 3 of the best ASX 200 shares to buy in March
• Is the Westpac (ASX:WBC) share price the best bank idea for dividends?
• WAM boss urges cashed-up ASX 200 companies to buy, invest or pay dividends

Motley Fool contributor James Mickleboro owns Westpac Banking Corporation. 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 Wesfarmers Limited. The Motley Fool Australia has recommended Westpac Banking Corporation. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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As conflict in Europe takes another unsuspecting turn, the outlook for commodities continues to shine – much to the dismay of consumers in the end-market.

Talks of a ban on Russian oil exports are being taken very seriously amongst market pundits, such that Brent Crude futures nudged past US$130 barrel this week, their highest in more than a decade.

Ukrainian wheat, which is sold on the black sea supply route, has also faltered amid the tension, sending global wheat prices skyrocketing to US$11.40 per bushel after hitting US$12.52/bushel yesterday in response to the disruption.

Nickel futures soared “to infinity” yesterday according to one trader such that the London Metals Exchange (LME) suspended trading of the metal to prevent an all-out disaster. Russia is the world’s largest nickel producer.

Gold, the traditional safe-haven asset in times of inflation, spiking interest rates, and geopolitical tension, has also surged to its all-time high and now trades at US$2,055 per troy ounce.

In fact, the Bloomberg Commodities Index (BCOM), a proxy for the performance of a global basket of commodities used by investors worldwide, is at its highest level in over 10 years as well.

It has slowly risen from the depths of 2020, when COVID-19 first reared its ugly head onto the scene. Lockdowns resulted in massive supply shock in both raw materials and commodities, compounded by huge backlogs in supply chains around the world. People had the money, but ‘drivers’ simply couldn’t deliver the goods, due to the lockdowns.

The latest conflict only adds a petrol can to the fire and has sent the global commodity sector into a blaze such that the BCOM has shot up vertically north in February/March.

Is this the time of ASX commodity shares?

By all accounts, a surge in commodities like gold, nickel, wheat – any product for that matter – is usually a net positive for the producers and miners.

However, miners, explorers, refiners and every player along the value chain realises the impulse effect from a massive jump in the price of base commodities. It’s not always a gain though – costs to increase for some unfortunate companies.

Where ASX commodity players realise the biggest benefit is to revenue, operating cash flow and free cash flow.

Each of these stem from gross profit and net profit respectively. The surge in commodity prices helps miners and producers at the margin, by feeding more cash down through the income statement for operations and then after everything has been paid.

If fundamentals are anything to go by, then it’s a good chance investors might look favourably on these metrics, particularly as free cash flow, margins and revenue growth are key metrics analysts use to value shares.

Not only that – but bigger profits and free cash flow means the prospect for bigger dividends, something we’ve seen abundantly clear on the ASX these past 2 years.

However, it’s the market’s opinion that matters most. Even as nickel surged to unfathomed heights of US$100,000 per tonne yesterday night, shares in BHP Group Ltd (ASX: BHP) – one of the world’s largest nickel players – finished in the red today.

Not only that but nickel pig iron specialist Nickel Mines Ltd (AX: NIC) saw its equity value evaporate by over 20% before entering into a trading pause early in the session. It fell 5% by the close of trade today as well.

You see, it’s not all that clear at face value. Sure, higher commodity prices mean better revenues for those involved, generally speaking.

But there is a whole other side to that equation, one that involves costs being passed down the line, as BHP recently alluded to.

The mining giant had recently warned of the “spillover effect” from this surge in commodities to things like inflation and global growth.

Moreover, Nickel Mines share price tanked today amid concerns of its ties to Chinese nickel giant Tsingshan and its affiliate Shanghai Decent.

Tsingshan and the affiliate were recently caught out holding an enormous short position on nickel futures which has obviously backfired spectacularly in the last few days. There are reports that coverage of this short position is what may have helped propel nickel so high.

Even though Nickel Mines reassured its deal covenants remain well intact, the market was still weary and offloaded shares with authority today.

What else to consider?

But let’s not also forget that this commodities rally, has – according to strategists – been driven in part by a set of extenuating circumstances that most certainly aren’t the ‘norm’.

The combination of COVID-19 and unprecedented monetary and fiscal policy already staged the perfect storm for the sector to stage a rally. Whereas Russia’s invasion of Ukraine and the US Federal Reserve fighting inflation are the two ‘sparks’ for 2022, according to Bloomberg commodity strategist Mike McGlone.

So much so that McGlone even postulates that crude oil could even trade places with bitcoin as the preferred risk asset of choice for investors going forward.

“When the history of 2022 is written, crude oil at the top of our performance scorecard to Feb. 28 appears at elevated risk of trading places with Bitcoin at the bottom”, he said in a recent note.

However, it could be agricultural commodity producers that benefit the most in 2022 according to McGlone, if the current trends keep at pace.

“If prices sustain near end-of-February levels, it should be a boon for energy and agriculture producers”, the strategist said.

As the tension continues to garner steam in Europe, it remains to be seen what direction the global commodities basket will head next.

Nonetheless, as a group, ASX commodity shares are outstripping the broader market. Each of the Betashares Australian Resources Sector ETF (ASX: QRE) and the VanEck Australian Resources ETF (ASX: MVR) that track Aussie commodity players are soaring in the past month and have broken away from Australian large caps in the S&P/ASX 200 index (ASX: XJO).

As with any market situation, it appears to be a case of investors separating those companies deemed to produce the highest forward return potential based on a combination of fundamental and market factors.

The post Is this still the dawning of the age of ASX commodity shares? appeared first on The Motley Fool Australia.

More reading

• Record $36bn in dividends could help ASX share market recovery
• What happened to the Nickel Mines (ASX:NIC) share price today?
• 3 under-the-radar commodity prices soaring since the Ukraine crisis
• Here are the 3 most heavily traded ASX 200 shares this Wednesday
• Here’s why the BHP (ASX:BHP) boss is still optimistic about China

Motley Fool contributor Zach Bristow 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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It was a good trading day for ASX nickel shares today, with most finishing ahead off the back of surging nickel prices in global markets.

Four ASX nickel shares that finished in the green include Mincor Resources NL (ASX: MCR), Panoramic Resources Ltd (ASX: PAN), IGO Ltd (ASX: IGO) and Western Areas Ltd (ASX: WSA).

Let’s take a closer look at their performance today.

Nickel buying frenzy shoots price to record highs

ASX nickel shares jumped today after nickel prices continued to explode in international markets overnight.

By the close of trade on Wednesday, Mincor shares had climbed 2.93%, Panoramic shares were up 3.23%, the IGO share price jumped 2.19% and Western Areas finished 1.73% higher.

Nickel prices hit record highs above US$100,000 a tonne overnight. The metal surged 400% compared to Friday’s close, according to a report on NAB trade.

In response to these unprecedented prices, the London Metal Exchange suspended nickel trading until at least Friday.

Nickel prices have rocketed 104.49% in a month and 200.57% in a year, trading economics data reveals.

In a report from Thomson Reuters cited by NAB, ING analysts said Nickel is clearly trading in crisis mode.

Fundamentals, though supportive of stronger prices, do not justify this frenzy. The market has long faced structural issues.

Nickel is a crucial component in electric batteries. In a company presentation reported to the market yesterday, Mincor noted electric vehicle sales could hit 20 million by 2025 and more than 70 million by 2040. The company added:

High nickel content batteries are the key to longer range, more efficient electric vehicles.

One ASX nickel share that wasn’t so lucky today was Nickel Mines Ltd (ASX: NIC). As my Foolish colleagues reported, the company’s share price plummeted today, sinking 23% before recovering to finish 4.75% in the red at market close.

ASX nickel share recap

Despite some experts calling it out today as a market frenzy, it’s been a big 12 months for ASX nickel shares. Mincor shares have rocketed 115% in the past year, Panoramic is up a whopping 146%, the IGO share price has seen gains of 108% and Western Areas shares surged 50% in this period.

In comparison, the S&P/ASX 200 Index (ASX: XJO) has returned around 4.16% in the past year.

The post Four ASX nickel shares are in the green today. Here’s why appeared first on The Motley Fool Australia.

More reading

• 5 things to watch on the ASX 200 on Wednesday
• Up 17% this month, why the IGO (ASX:IGO) share price can keep gaining: broker
• 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

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 S&P/ASX 200 Index (ASX: XJO) managed to climb higher on Wednesday thanks in part to a strong showing by ASX tech shares. Yet, there were still a handful of tech companies that tumbled to new 52-week lows.

At times, it can be telling when certain ASX shares underperform on days of broad strength. Such situations usually indicate investors are paying attention to more prevalent issues at the company level than the positivity demonstrated at a sector-wide level.

Having said this, let’s take a look at three ASX tech shares that reached new lows today.

These ASX tech shares are not catching a break

Siteminder Ltd (ASX: SDR)

While the global hotel e-commerce platform technically reached a new 52-week low today, the company has only been listed since 8 November 2021.

Following its initial share price pop on debut, this ASX tech share has failed to impress shareholders. In February, the Siteminder share price suffered a blow after reporting a net loss of $87 million for the December ending half year.

However, today’s negative move occurred without any substantial information. The company is slated to enter the S&P/ASX 300 Index (ASX: XKO) on 22 March. Shares in Siteminder finished the day at $4.52, down 5.8% from their previous close.

Damstra Holdings Ltd (ASX: DTC)

Another ASX tech share hitting a new 52-week low today was the workplace management solutions company, Damstra Holdings.

Investors have gone cold on Damstra after a guidance downgrade in November last year. Since then, the picture hasn’t gotten prettier, as the company reported a net loss of $56 million compared to $5.49 million in the previous corresponding period.

In a similar fashion, Damstra did not release any announcements today. However, the company is expected to be removed from the All Ordinaries Index (ASX: XAO) this month. Shares in Damstra finished the day at 20 cents, up 2.6% — rebounding from their new 18 cent low.

Dug Technology Ltd (ASX: DUG)

Lastly, Dug Technology is the third and final ASX tech share that cemented a new 52-week low on Wednesday.

Unfortunately for shareholders, it has been a slow and steady grind lower for the high-performance computing company over the past 12 months. Today, Dug Technology announced the appointment of a new CEO after its previous chief executive resigned yesterday.

Shares in Dug Technology finished the day at 55 cents, down 1% from their previous close.

The post 3 ASX tech shares at 52-week lows despite tech rally appeared first on The Motley Fool Australia.

More reading

• Here’s why this ASX tech share is surging 12% today
• Damstra (ASX:DTC) share price stoops 11% amid downgraded margins
• Recurring revenue or recurring losses? This ASX share just sunk on mixed earnings

Motley Fool contributor Mitchell Lawler has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns and has recommended Damstra Holdings Ltd and SiteMinder Limited. The Motley Fool Australia owns and has recommended Damstra Holdings 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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A wall of cash from dividend payouts is expected to give ASX share market bulls extra firepower to buy the dips.

That’s the prediction of some market experts like Bell Potter strategist Richard Coppleson. He calculates that investors will reap more than $36 billion in dividends by April this year, according to reporting in the Australian Financial Review.

The collective value of dividends declared in the February reporting season was 40% higher than the same time last year.

Dividend windfall to support ASX share prices

“The dividends to be paid in March and April will be positive for retail sales and also the market, as some of this cash will be reinvested back into stocks in late March through to mid-April,” Coppleson told the AFR.

“If we see the US market re-test its January lows, which is still a big chance, many institutional investors will have cash flying in from mid- to late-March that they will be able to throw at the market.”

This month should see $26 billion in dividends hit shareholders’ bank accounts. There is a further $10.3 billion that will flow into shareholders’ pockets in April.

Cash to calm the volatility

If much of the cash is put back into the market, as Coppleson is predicting, it could help stabilise the S&P/ASX 200 Index (ASX: XJO) during this volatile period.

Russia’s attack on Ukraine, rising interest rates, and fears of stagflation have sent ASX shares on a rollercoaster ride.

Most of the dividend support is coming from resources shares thanks to strong commodity prices.

Top dividend-paying ASX shares

BHP Group Ltd (ASX: BHP) is the reigning dividend champ with a record interim payout of US$1.50 (A$2.08) a share. BHP alone accounts for nearly 29% of the total value of dividend payments in the latest reporting season.

The next best dividend-payer, and the only non-resource ASX share in the top 5 dividend payers, is Commonwealth Bank of Australia (ASX: CBA). Australia’s largest bank declared a $1.75 per share interim dividend. This totals $3 billion in dividends.

Fortescue Metals Group Limited (ASX: FMG) is in third spot despite cutting its interim dividend by 41%. Fortescue is paying out $2.6 billion. Rio Tinto Limited (ASX: RIO) is in fourth position with its $2.5 billion cash splash.

Woodside Petroleum Limited (ASX: WPL) rounds up the top five, forking out $1.4 billion in dividends.

Given the positive earnings outlook coming out of the February reporting season, plus the ongoing surge in commodity prices, the ASX dividend party may last a while longer yet.

The post Record $36bn in dividends could help ASX share market recovery appeared first on The Motley Fool Australia.

More reading

• Here are the top 10 ASX shares today
• 3 under-the-radar commodity prices soaring since the Ukraine crisis
• Here are the 3 most heavily traded ASX 200 shares this Wednesday
• Here’s why the BHP (ASX:BHP) boss is still optimistic about China
• Want the dividends from these 5 ASX shares? You’d better be quick!

Motley Fool contributor Brendon Lau owns BHP Billiton Limited, Commonwealth Bank of Australia, Fortescue Metals Group Limited, and Rio Tinto Ltd. 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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At first, it looked like the Nickel Mines Ltd (ASX: NIC) share price wasn’t going anywhere for the rest of Wednesday.

The company requested a trading halt during mid-afternoon trade following the tanking of its shares.

However, towards the back end of the day, Nickel Mines provided an update.

At market close, the low-cost nickel producer’s shares finished down 4.75% to $1.405 apiece. That’s in sharp contrast to the 22.71% in the red that Nickel shares were at before being halted, at $1.14.

Why were Nickel Mines shares put into a trading halt?

Following the dramatic turn in the Nickel share price, the company’s latest statement answered some questions relating to the trading halt.

Nickel Mines advised it is not aware of any information that could explain why the recent trading in its shares has been volatile.

However, the company did note that it recognised recent press speculation regarding a short position in the London Metal Exchange (LME) nickel held by Tsingshan group, and the implications this had on global markets.

Nonetheless, Nickel Mines pointed out the following to reassure shareholders:

• Operations at the Hengjaya Nickel and Ranger Nickel projects are unaffected, as is commissioning at the Angel Nickel project and construction at the Oracle Nickel project.
• Tsingshan has firmly assured Nickel Mines that it has no intention of selling any shares that it holds.
• There has been no change in Tsingshan’s undertaking to purchase all of the nickel pig iron produced by the company’s RKEF operations.
• There has been no impact on Tsingshan’s intention to receive Nickel Mines shares in the conditional placement for the company to acquire a 70% interest in the Oracle Nickel Project.

As my Motley Fool colleague Mitch Lawler pointed out, the nickel price accelerated to a record high of US$43 per kilogram overnight. This represents a mammoth 70% increase since the start of this month.

As a result, the LME decided to halt nickel trading and cancel trades last night.

The shock move came as government sanctions around the world have threatened to block the supply from key producer Russia.

Nickel is a key component in lithium-ion batteries, which is used in generating power for electric vehicles. It is able to produce a lot more energy into batteries than using cobalt. The latter is considered a more expensive metal and has fewer purposes across industries.

Nickel Mines share price summary

Over the past 12 months, the Nickel Mines share price has gained more than 4%.

Although, when looking at year to date, the company’s shares are down by almost 2%.

Nickel Mines presides a market capitalisation of roughly $3.86 billion with approximately 2.62 billion shares on its registry.

The post What happened to the Nickel Mines (ASX:NIC) share price today? appeared first on The Motley Fool Australia.

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• Why Aurelia Metals, Brambles, GQG, and Nickel Mines shares are falling
• Nickel Mines (ASX:NIC) share price plummets 22% as nickel prices go crazy
• ASX 200 (ASX:XJO) midday update: Origin’s $250m buyback, Nickel Mines smashed

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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Shares in Race Oncology Ltd (ASX: RAC) soaring today to finish trading 14% higher in the green.

The Race Oncology share price flamed higher despite no market-sensitive information from the company’s camp, nor was there any major upsets in the wider sector.

Zooming out, we see that Race Oncology is down over 32% for the year, and 11% in the last month alone, which could be important information.

Why did Race Oncology shares flame higher today?

It’s not abundantly clear what’s sent Race’s share price further north today.

The S&P/ASX 200 Health Care index (XHJ) was also firmly in the green today, finishing up 0.29% at 38,796 points.

Trading volume of Race Oncology shares was also substantially higher than normal, above the 4-week average at 890,904 shares.

Looking a bit deeper at the order book and market depth monitor provided by Bloomberg Intelligence, it’s also clear that brokers filled more buy orders than sell orders today as well, when measured by volume.

In fact, at one point 74% of the order volume has stemmed from those asking to buy and another 22% from those offloading Race Oncology shares.

The first of these large orders was filled at around 11:58 am, just when shares really took off, as seen on the chart below which tracks Race’s performance on Wednesday.

There’s been a tug-of-war between buyers and sellers over the past two hours of trade but nonetheless, considering the laws of supply and demand, when there are more buyers than sellers – this tends to bid the price up in markets.

It remains to be seen exactly what’s got market pundits piling in today to secure a spot in the front row of Race’s growth story.

But with smaller ASX shares by market capitalisation, even modestly sized order volumes can cause large fluctuations in the share price.

Not to mention during market volatility, that’s when speculators and large trading firms tend to be most active, to capture price movements in each direction.

Race Oncology share price snapshot

In the past 12 months, the Race Oncology share price has lost 32% after collapsing from a high of $3.71 last year. This year to date, things aren’t any better and shares have tanked 27%.

At the current share price, Race Oncology has a market capitalisation of $419.5 million.

The post Why did Race Oncology (ASX:RAC) shares bounce 14% higher on Wednesday? appeared first on The Motley Fool Australia.

More reading

• Why did the Race Oncology (ASX:RAC) share price drop 10% today?

Motley Fool contributor Zach Bristow 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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