The S&P/ASX 200 Index (ASX: XJO) went up by around 0.2% to 7,313 points.

Here are some of the highlights from the ASX:

Telstra Corporation Ltd (ASX: TLS)

The Telstra share price went up 4.4% today in response to the company announcing the sale of 49% of its business for $2.8 billion.

A consortium made up of Future Funds, Commonwealth Superannuation Corporation and Sunsuper will buy almost half of the Towers business.

It’s the largest mobile tower infrastructure provider in Australia with around 8,200 towers.

The transaction values Telstra InfraCo Towers at $5.9 billion. Telstra expects net cash proceeds after transaction costs of $2.8 billion at completion and the Towers entity will have no debt.

Andrew Penn, the CEO of Telstra, said:

Telstra’s objective in seeking a strategic partner has been to maximise overall value for our shareholders, maintain control of the assets and agree terms that secure Telstra’s mobile network leadership and competitive differentiation into the future. I am pleased that we have been able to achieve that ahead of schedule through this transaction announced today.

We had previously intended to commence the process to seek external strategic investment in the Towers business in early FY22, with a view to completing any transaction by the end of the 2022 calendar year. We were approached by the consortium earlier in the year as they recognised the value of these assets and provided a compelling rationale to progress the transaction ahead of schedule. We believe the value of the transaction; the high calibre consortium members and the terms of the agreement which protect Telstra’s network differentiation, support our decision to accelerate the process.

Telstra said that it intends to return approximately 50% of net proceeds to shareholders in FY22. The ASX 200 share anticipates providing further details about the manner of the shareholder return, including a potential share buy-back in FY22 at its full-year results in August. The remainder of the proceeds will be used for debt reduction to ensure it maintains balance sheet strength and flexibility.

AGL Energy Ltd (ASX: AGL)

The AGL share price fell around 10% after giving a business update.

AGL said its board believes proceeding with the proposed demerger will be in the best interests of shareholders, protecting value and providing greater strategic focus.

AGL Energy will become Accel Energy, a baseload power producer focused on redevelopment of its sites as low-carbon industrial energy hubs.

Accel Energy will demerge AGL Australia, one of the country’s leading multi-product energy retailer backed by flexible energy trading, storage and supply.

The ASX 200 company said that there is strong support from lenders for new borrowing facilities for both entities.

It’s anticipated that completion of the demerger will be in the fourth quarter of FY22, subject to relevant approvals.

Accel Energy will retain a minority ownership interest of between 15% to 20% of AGL Australia after the demerger.

AGL also said its underlying earnings before interest, tax, depreciation and amortisation (EBITDA) is expected to be within the lower half of its previous range of $1.59 billion to $1.85 billion.

Underlying net profit after tax (NPAT) is expected to be around the middle of the previous range of $500 million to $580 million.

For FY22, AGL expects a material step-down of earnings as a result of lower wholesale electricity prices of the past two years now being realised through forward sold positions, as well as the non-recurrence of insurance proceeds and increases to wholesale gas supply costs.

The post ASX 200 rises, Telstra up, AGL sinks appeared first on The Motley Fool Australia.

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• ASX gold miners like Regis (ASX:RRL) hit a 52-week low today
• These 2 high-yielding ASX dividend shares are rated as buys by brokers
• FANG+ ETF (ASX:FANG) tumbles 10% on ex-dividend day

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 owns shares of and has recommended Telstra Corporation Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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Some small cap ASX shares could be worth looking at for the long-term.

Smaller businesses may have a bigger and longer growth runway because of the smaller size of the company compared to their larger counterparts.

However, just because a business is small doesn’t mean that a company is worth owning.

Here are two small cap ASX shares to consider:

Adore Beauty Group Ltd (ASX: ABY)

Adore Beauty is an e-commerce beauty business with a portfolio of over 260 brands and 10,800 products. It operates in both Australia and New Zealand.

The company is seeing a structural shift in consumer behaviour towards online retail, based on continued strong retention of customers acquired during the COVID-19 lockdown.

Adore Beauty is seeing an acceleration of growth during these COVID affected times. In FY19, revenue increased 38.6%. Management are expecting revenue growth of between 43% to 47% in FY21.

Indeed, the company announced its FY21 third quarter saw revenue growth of 47% on the prior corresponding period. Active customers were up 69% over the prior corresponding period to 687,000.

Adore Beauty is planning to continue to invest with discipline to drive revenue growth and further drive its online market share. Its investments include marketing, advertising, people, its mobile app, the loyalty program, content capabilities, range, adjacency expansion and private label development.

According to Frost & Sullivan, the beauty and personal care market in Australia is worth $11.2 billion and is expected to grow at a compound annual growth rate of 26% to 2024.

The small cap ASX share said that given the predominately fixed nature of the business’ cost base, it’s expecting scale benefits to increase operating leverage and deliver earnings before interest, tax, depreciation and amortisation (EBITDA) margin expansion in the longer-term as the company continues to grow revenue.

UBS currently rates Adore Beauty as a buy, with a price target of $5.60. The broker thinks the beauty business can benefit from the e-commerce growth and it’s a good time to buy after the share price has dropped quite a lot from its listing price.

Volpara Health Technologies Ltd (ASX: VHT)

Volpara is health technology software business that has a breast health platform which assists in the delivery of personalised patient care.

The company is seeing operating leverage. In its recent FY21 result, total revenue increased 57% whilst subscription revenue grew 99%. Gross profit went up 67% to NZ$18.1 million, reflecting a gross profit margin of over 91%. Operating costs only increased 8% year on year, or 4% excluding the CRA Health acquisition.

Volpara has outlined a number of areas where the business is expecting growth.

It’s targeting increased average revenue per user (ARPU) by selling a platform, not just a product. Its platform includes all of its products with multiple integrations that aims to make the suite even more compelling. Most new sales are now for two or three products, representing significantly increased ARPU. Its relationship with genetics companies is expected to increase that ARPU further.

The small cap ASX share says that it has a pipeline of new deals lined up thanks its networks, customer referrals and digital marketing.

Volpara also believes it can achieve growth through upselling by upgrading MRS users to its patient hub and Volpara products. Management suggested a 200% to 300% increase in recurring revenue for those that upgraded.

It’s still seeing a very high retention rate and there are further acquisition opportunities that can increase its market share and/or improve its skills and products to help increase ARPU and provide technology for the future.

Volpara is expecting revenue in FY22 of approximately NZ$25 million to NZ$26 million, which would growth of at least 27%.

The post 2 top small cap ASX shares that might be buys appeared first on The Motley Fool Australia.

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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. owns shares of and has recommended VOLPARA FPO NZ. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended Adore Beauty Group Limited. The Motley Fool Australia owns shares of and has recommended VOLPARA FPO NZ. 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 BHP Group Ltd (ASX: BHP) share price continued its positive run on Wednesday.

The mining giant’s shares rose 1% to close the day at $48.57.

This latest gain means the BHP share price is now up 13% since the start of the year.

Can the BHP share price climb even higher?

The good news is that it may not be too late to invest according to analysts at Goldman Sachs.

This morning the broker retained its buy rating and $53.80 price target on the company’s shares. Based on the current BHP share price, this implies potential upside of ~11% over the next 12 months.

And if you include dividends (Goldman is forecasting US$2.52 per share in FY 2021 and US$2.58 per share in FY 2022), the potential total return stretches to approximately 18%.

Why is Goldman positive on BHP?

There are three key reasons that Goldman Sachs is bullish on the mining giant. The first is the strong free cash flow the company is currently generating thanks to favourable commodity prices.

It explained: “Strong earnings growth and FCF: We forecast a c. 50% increase in EBITDA and a doubling of FCF in FY21 (equating to c. 10-11% FCF yield), driven by our positive view on met coal, copper and oil prices.”

Another reason it feels the BHP share price is good value is the company’s growth prospects.

Goldman said: “Strong production growth: BHP’s group Cu Eq production should increase by 4-5% in FY22 and 6-7% in FY23, driven by a +250-270kt lift in copper volumes from Spence and Escondida, +10MMboe of oil volumes with new production from Mad Dog II/Atlantis Phase 3/Shenzi. BHP will likely also see a significant margin and FCF kicker in the Pilbara from the high grade South Flank deposit. Longer term, we see possible 50% volume growth to +150MMboe driven by Trion, Calypso (formerly T&T North), Shenzi North (formerly Wildling), and Scarborough.”

The final reason for the broker’s positive view is its ongoing portfolio optimisation, which it appears to believe will create value for shareholders.

It concluded: “Potential benefits from ongoing portfolio optimisation: Ongoing with the announcement to divest thermal and weak coking coal, and Bass Strait gas.”

Overall, this could make BHP worth considering if you’re looking for exposure to the resources sector.

The post Why this broker thinks the BHP (ASX:BHP) share price can storm higher appeared first on The Motley Fool Australia.

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• ASX 200 Weekly Wrap: Share market breaks 5 week winning streak
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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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The Telstra Corp Ltd (ASX: TLS) share price found itself as one of the top-performing S&P/ASX 200 Index (ASX: XJO) shares on Wednesday.

After a solid day in the green, the Telstra share price was up 4.44% at market close, trading at $3.76.

What’s driving the Telstra share price?

Investors were buying up shares in the blue-chip telco giant after the company announced that it had sold a 49 per cent interest in its Telstra Infraco Towers business.

Telstra advised that a consortium comprising the Future Fund, Commonwealth Superannuation Corporation and Sunsuper agreed to acquire the 49 per cent interest and come on board as a strategic partner.

The transaction is expected to be completed in the first quarter of FY22, with Telstra expecting to receive net cash proceeds after transaction costs of $2.8 billion.

Telstra advised that it intends to return approximately 50 per cent of the proceeds to its shareholders in FY22, including a potential share buy-back.

The company said that it will use remaining proceeds towards debt reduction to “maintain balance sheet strength and flexibility”.

What did management say?

Telstra CEO, Andrew Penn welcomed the significant milestone, saying:

Our T22 strategy is delivering on multiple fronts and I am proud of what we have achieved.

Today’s announcement is a further endorsement of the strategy, as the establishment of our infrastructure assets as a separate business was designed to enable us to better realise the value of these assets, take advantage of potential monetisation opportunities and create additional value for shareholders and that is exactly what today’s announcement achieves.

Telstra share price rallies to pre-COVID levels

The Telstra share price has been a standout performer in 2021, lifting by almost 25% year-to-date.

Telstra shares haven’t traded at $3.70 levels since 24 February 2020, right before the COVID-19 induced selloff.

While today’s transaction appears to be great news in terms of shareholder value, Goldman Sachs thinks the business has a lot of room to grow, and lifted its share price target to $4.20 yesterday.

The post Why the Telstra (ASX:TLS) share price jumped 4% higher today appeared first on The Motley Fool Australia.

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• Why Life360, Paradigm, Sayona Mining, & Telstra shares are charging higher
• ASX 200 up 0.5%: Telstra asset sale, AGL demerger, Nuix crashes again

Motley Fool contributor Kerry Sun has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Telstra Corporation Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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Given the strong potential returns on offer at the small end of town, having a little exposure to it could potentially give a balanced portfolio a boost.

With that in mind, if your risk tolerance allows for it, you may want to get better acquainted with these highly rated small cap shares:

Adore Beauty Group Limited (ASX: ABY)

The first small cap to watch is Adore Beauty. It is Australia’s leading online beauty retailer. While its near term growth may be subdued as it cycles elevated sales at the height of the pandemic, it has been tipped to resume its rapid growth soon after. Analysts at UBS are positive on its outlook. The broker currently has a buy rating and $5.60 price target on its shares.

Booktopia Group Ltd (ASX: BKG)

The second small cap ASX share to watch is Booktopia. This online book retailer has been growing at an explosive rate in FY 2021. For example, during the first half, the company reported a 51.1% increase in revenue to $112.6 million and a 502.3% jump in underlying EBITDA to $8 million. It then followed this up with a 53% increase in quarterly revenue during the third quarter. This is being driven by the shift to online shopping and its new distribution centre. Morgans is a fan of Booktopia and is expecting further market share gains. It has an add rating and $3.54 price target on its shares.

Universal Store Holdings Limited (ASX: UNI)

Another small cap to watch is Universal Store. It is a fashion retailer targeting the 16-35 year old fashion focused customer. It has been a very positive performer during the pandemic, reporting impressive growth during the first half of FY 2021 and then again during the third quarter. This appears to have positioned Universal Store for a bumper full year profit result. Morgans currently has an add rating and $8.37 price target on its shares.

The post 3 exciting small cap ASX shares to put on your watchlist appeared first on The Motley Fool Australia.

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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 recommended Adore Beauty Group Limited and Booktopia Group Limited. 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 Lovisa Holdings Ltd (ASX: LOV) share price finished the day 7% higher. You would think such a move would come with an announcement. Though the jewellery retailer itself had no news, the company’s co-founder Brett Blundy certainly did.

Lovisa shares have made for a great investment over the past year. After today’s gain, the Lovisa share price has appreciated 160% since a year ago.

Another one bites the dust

Brett Blundy, Lovisa co-founder and chairman of the board, has revealed yet another business sale. The jewellery retailer’s share price climbed today and so did Brett Blundy’s wealth following the sale of his investment firm’s ownership in Honey Birdette to Playboy owner PLBY Group Inc (NASDAQ: PLBY) for $US333 million ($A443 million) in cash and stock.

Honey Birdette is a luxury lingerie and lifestyle brand founded in Australia back in 2006. Blundy’s investment company, BBRC International held a 62% stake in the company founded by Janelle Barboza and Elouise Monaghan. Over the years the ‘racy’ retailer has expanded, now operating across Australia, the United States, and the United Kingdom with 60 stores.

Exploring the financials, the company expects to achieve $73 million in revenue and roughly $28 million in earnings before interest, tax, depreciation, and amortisation (EBITDA) for FY21. Impressively, this would represent an increase of more than 40% and 95% respectively.

The sale of Honey Birdette is not Blundy’s first lingerie exit. Back in 2018, the Lovisa co-founder cashed out of Bras N Things for $500 million — that one went to Hanesbrands Inc. (NYSE: HBI).

And the Lovisa share price?

It’s hard to say what dots investors might be connecting on this one. Perhaps the sale instils confidence in Lovisa shareholders for Blundy’s leadership. Or maybe the market is speculating over the retailer’s future buyout potential.

The billionaire has certainly backed plenty of winners in the retail space. For instance, Adairs Ltd (ASX: ADH), Accent Group Ltd (ASX: AX1), and Universal Store Holdings Ltd (ASX: UNI) in the past year have gained 79%, 94%, and 66% respectively… and Mr Blundy is invested in all three.

Beyond that, the serial entrepreneur owns 40.2% of the Lovisa shares on offer and is by far the largest shareholder.

The post Lovisa (ASX:LOV) share price gains 7% following co-founder’s Honey sale appeared first on The Motley Fool Australia.

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• 2 compelling ASX shares that could be buys in June 2021

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. has recommended ADAIRS FPO. The Motley Fool Australia owns shares of and has recommended ADAIRS FPO. The Motley Fool Australia has recommended Accent Group. 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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One thing the S&P/ASX 200 Index (ASX: XJO) is not short of is dividend shares. Which certainly is a big positive in this low interest rate environment.

Two ASX 200 shares that have been tipped to grow their dividends are listed below. Here’s what you need to know about them:

Sonic Healthcare Limited (ASX: SHL)

The first ASX dividend share to look at is Sonic Healthcare. It is one of the world’s leading healthcare providers, with operations in Australasia, Europe and North America. It currently employs more than 1,500 pathologists and radiologists, and more than 10,000 medical scientists, radiographers, sonographers, technicians, and nurses.

It has also just added to its network with a binding agreement to acquire 100% of Canberra Imaging Group. Management believes the acquisition is a significant and positive step in the development of Sonic’s Imaging division in Australia, broadening its footprint, deepening its talent pool, increasing the revenue of the division by ~10%.

In the meantime, Sonic appears well-placed for growth in the near term thanks to the increased demand for COVID testing.

One broker that is positive on Sonic is Credit Suisse. It currently has an overweight rating and $40.00 price target on its shares. The broker is also forecasting dividends of 97 cents per share in FY 2021 and 98 cents per share in FY 2022. Based on the latest Sonic share price of $38.40, this will mean yields of 2.5% and 2.6%, respectively.

Wesfarmers Ltd (ASX: WES)

Another dividend share to look at is Wesfarmers. It is the conglomerate behind several popular retail brands such as Bunnings and Kmart and a diverse group of industrial businesses.

It has been a strong performer in FY 2021 thanks to positive performance across the majority of its businesses. Though, the star of the show continues to be the key Bunnings business. The hardware giant has been benefiting from the housing market boom and home improvement-related stimulus, underpinning impressive sales and profit growth this year.

Macquarie appears confident that its growth can continue and is forecasting fully franked dividends of $1.74 per share in FY 2021 and $1.76 per share in FY 2022. This implies yields of 2.9% and 3%, respectively, over the next two years.

The post 2 ASX 200 shares growing their dividends appeared first on The Motley Fool Australia.

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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Wesfarmers Limited. The Motley Fool Australia has recommended Sonic Healthcare Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The Qantas Airways Limited (ASX: QAN) share price had a decent trading day today. By close of trade, shares in Australia’s national carrier were selling for $4.66 – up 2.42%. For context, the S&P/ASX 200 Index (ASX: XJO) was 0.16% higher.

While there haven’t been any market sensitive announcements over the past week, Qantas shares have been quite volatile, reaching a low of $4.46 and a high of $4.78 during the period.

Let’s take a closer look at the company.

Qantas shares are trading higher

Today’s price rise comes off a sluggish two trading days for the Qantas share price. While there are no definitive answers as to why Qantas shares have struggled recently, there may be a likely explanation: coronavirus.

As we reported on Monday, ASX travel shares took a hammering on the first trading day of Sydney’s two-week lockdown.

COVID-related lockdowns are now mandated in Darwin, Perth, southeast Queensland and Townsville. All other states and New Zealand have some form of COVID restrictions and/or closed border policies.

The situation, however, has not notably improved today. In fact, another city, Alice Springs, has gone into lockdown and new, linked cases have emerged in Adelaide and Melbourne.

None of these developments, it would seem, have enough pull on the Qantas share price. Perhaps investors may be feeling easier about the nation’s COVID situation.

The post The Qantas (ASX:QAN) share price finished 2.5% higher today appeared first on The Motley Fool Australia.

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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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There are a handful of S&P/ASX 200 Index (ASX: XJO) shares that have the potential to produce growth over the longer-term.

Businesses in the ASX 200 might be one of the national or global market leaders in their industry. COVID-19 has been disruptive but there could be growth potential over the longer-term for these two ASX shares:

Resmed CDI (ASX: RMD)

Resmed is an ASX healthcare tech share. Its digital health technologies and cloud-connected medical devices provide care for people with sleep apnea, chronic obstructive pulmonary disease (COPD) and other chronic diseases. Resmed says that its out-of-hospital software platforms support the professionals and caregivers who help people stay healthy.

Some of its products have been involved in helping in the treatment of COVID-19 patients. But the global recovery from these COVID times and vaccinations are seeing an ongoing of core patient flow across the business.

Excluding the COVID-19 revenue from the quarter ending 31 March 2020 quarter, the ASX 200 share achieved positive revenue growth in the quarter ending 31 March 2021. Net operating profit also increased.

The Resmed CEO Mick Farrell said:

Going forward, we see accelerated awareness of the importance of respiratory health, growing adoption of digital health, and an increased focus on the importance of healthcare delivered at home. We are confident in accelerated growth in patient flow, and ongoing progress toward our goal of improving 250 lives in out-of-hospital healthcare in 2025.

According to Commsec, the Resmed share price is valued at 47x FY21’s estimated earnings.

Cleanaway Waste Management Ltd (ASX: CWY)

Cleanaway is a leading total waste management, industrial and environmental services ASX 200 share. It has the largest waste, recycling and liquids collections fleets on the road, supported by a network of recycling facilities, transfer stations, engineered landfills, liquids treatment plants and refineries.

There are a few different growth trends that Cleanaway can benefit from. After export bans, there is an onshoring recycling opportunity. There is also a move towards a ‘circular economy’ with demand for locally recycled inputs.

Energy from waste is also an emerging multi-dollar industry, according to the ASX 200 business. It could be a key way to reduce greenhouse gas emissions.

Cleanaway recently announced a $501 million acquisition of Suez’s post collection assets to enhance its Sydney footprint. It delivers more than 10 years of airspace in the attractive Sydney market, whilst complementing Cleanaway’s collections operations.

This deal immediately adds to its underlying earnings and increases margins.

In the first half of FY21, it grew its underlying net profit after tax by 6.5%, with statutory profit jumping 75.3% to $79.4 million.

At the time of the half-year result, the ASX 200 share said that uncertainty in the trading environment continues, more so in some regions and industries than others. Despite that, Cleanaway said it remains confident that FY21 underlying EBITDA will be moderately higher than FY20.

Cleanaway is currently rated as a buy by Macquarie Group Ltd (ASX: MQG) with a price target of $3. The broker likes the growth trends that Cleanaway is exposed to.

The post 2 ASX 200 shares that might be buys for growth appeared first on The Motley Fool Australia.

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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 recommended ResMed. The Motley Fool Australia owns shares of and has recommended Macquarie Group Limited. The Motley Fool Australia has recommended ResMed Inc. 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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ASX gold shares have largely been trailing the broader market this year.

The gold price dropped another 0.2% overnight and is currently at a 10-week low of US$1,757 (AU$2,343) per ounce. That’s now down 15% from the US$2,064 that same ounce was worth on 6 August.

With gold edging lower again, most ASX gold shares finished the day down.

Newcrest Mining Ltd (ASX: NCM), for example, was down 1.6% to $25.28 per share.

Evolution Mining Ltd (ASX: EVN) slipped 0.66% to $4.50 per share.

And Northern Star Resources Ltd (ASX: NST) was down 1.51% to $9.78 per share.

But according to Saxo Market’s Ole Hansen, head of commodity strategy, gold could be in for a rebound, offering some welcome tailwinds to ASX gold shares.

The bullish case for gold

In Saxo’s Q3 2021 Quarterly Outlook report, Hansen said:

It’s our view that rising inflation is likely to be longer-lasting than transitory, thereby creating continued demand from investors as they will need real assets such as commodities to hedge their portfolios.

Combining this with our overall negative dollar view, precious metals – both gold and silver – should continue to attract demand, especially if an expected rise in Treasury yields are driven by rising inflation expectations, thereby preventing real yields from rising too far.

That’s Saxo’s mid-term view.

Citing short-term risks for the gold price, and hence ASX gold shares, is Carsten Fritsch, an analyst at Commerzbank AG.

According to Fritsch (as quoted by Bloomberg):

Gold repeatedly failed to overcome the 100-day moving average in recent days, which was a bearish sign. There is a risk now that so far patient ETF investors jump on the bandwagon and sell their holdings. This would amplify the downward move. 

With ASX gold shares heavily influenced by the price of the yellow metal they dig from the ground, investors will be eyeing the price moves closely.

If Saxo’s Hansen has it right and gold continues to attract demand in the upcoming quarter, it may prove an opportune time to buy the dip.

How these ASX gold shares moved this year

All 3 of the ASX gold shares listed above are in the red for the past 12 months.

The Northern Star Resources share price is down 27% over 12 months and down 23% year-to-date.

The Evolution Mining share price is down 20% in 12 months and down 10% so far in 2021.

And the Newcrest Mining share price is down 20% since this time last year and down 2% year-to-date.

The post ASX gold shares could be in for a lift: Saxo Markets appeared first on The Motley Fool Australia.

More reading

• ASX gold miners like Regis (ASX:RRL) hit a 52-week low today
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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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