ASX construction shares Boral Limited (ASX: BLD), Brickworks Limited (ASX: BKW), Cimic Group Ltd (ASX: CIM), Reliance Worldwide Corporation Ltd (ASX: RWC), and James Hardie Industries PLC (ASX: JHX) were all in the green today. By market close, they were up 0.8%, 4.23%, 1.47%, 3.99%, and 1.78%, respectively. For comparison, the S&P/ASX 200 Index (ASX: XJO) ended the day 0.4% higher.

Today’s price appreciation came as the Australian Bureau of Statistics (ABS) released figures showing building approvals are continuing at record pace.

Let’s take a closer look at some of the factors impacting ASX construction shares today.

Building approvals up

The number of dwellings approved rose 17.4% in March (seasonally adjusted), following a 20.1% rise in February. That’s according to the data released today by the ABS.

Daniel Rossi, director of construction statistics at the ABS, said the results were the second-highest on record.

“The total number of dwellings approved in March was the second-highest recorded, only exceeded by the November 2017 result,” Mr Rossi said.

New South Wales had the greatest increase in approvals for March at 26.9%. This was followed by Victoria (24.7%), Queensland (12.1%), and South Australia (3.5%). Dwelling approvals in Western Australia and Tasmania actually fell in March.

When only looking at private sector housing, Victoria delivered the most significant growth – up 7.8%. New South Wales had the fastest decline in this metric – down 10.5%.

The value of total buildings approved increased 36.3% to reach a record high. The value of total residential building rose 22.9%, driven by a 25.4% rise in new residential building. Residential alterations and additions rose 7.3%, also reaching an all-time high.

Further, the value of non-residential building reached an all-time high (up 59.4%), driven by a large rise in both private and public projects in March.

Shane Oliver, chief economist at AMP Capital, said the federal government’s HomeBuilder program probably had some effect in boosting approvals. He believes, however, the numbers also show an increase in actual construction in the month.

Aust Mar home building approvals +17%, volatile units +59%, houses +1% at record. Additions & alterations +7%.
HomeBuilder has likely brought forward approvals – but points to a strong rise in home building..+ve for jobs & may help slow house prices.
Non-res approvals also up. pic.twitter.com/l8HrVmVoBz

— Shane Oliver (@ShaneOliverAMP) May 5, 2021

https://platform.twitter.com/widgets.js

While today’s statistics are unlikely to have had a direct effect on ASX construction shares, they are indicative of the environment these companies are trading in. Arguably, today’s positive price movements could be a sign investors believe the building approval rates are indicative of what is to come, as well as what has already occurred.

Strong economic growth forecasts

In yesterday’s Reserve Bank meeting, chair Phillip Lowe said he was expecting GDP growth in 2021 to be stronger than initially expected.

“The Bank’s central scenario for GDP growth has been revised up further, with growth of 4.75 per cent expected over 2021 and 3.5 per cent over 2022,” Dr Lowe said.

He also expects unemployment to fall to 5% by the end of the year and 4.5% by the end of 2022.

Other factors pointing to strong GDP growth are the COVID-19 vaccination rollout (which experts are saying is needed to restart the economy) and rising new car sales. New car sales are widely regarded as an indicator of economic growth.

Shane Oliver says construction and the economy have a positive, almost symbiotic relationship:

While housing construction in total is only around 10 to 15% of GDP and housing construction specifically is only around 5 to 6% of GDP it is hugely cyclical, is a big employer and has big flow on effects to the rest of the economy.

Particularly once completed homes or additions to homes need to be fitted out with furnishings, fittings and consumer goods. So, the massive upswing in building approvals being seen is a positive sign that the economic recovery will remain on track over the next 12 months.

And of course, the relationship between construction and the economy is a positive one in that to the extent that strong construction can help drive a strong economy, the confidence and extra jobs that come with a strong economy can help further drive strong construction.

One could argue that ASX construction shares, therefore, could be the beneficiary of this economic growth. This, in turn, could fuel additional GDP growth in the short term, further benefitting these types of companies.

ASX construction shares’ recent history

By close of trade today, Boral shares were selling for $6.33, Brickworks shares were $21.17 each, Cimic Group shares were trading at $19.30 apiece, Reliance stock was $5.21, and to buy a share in James Hardie would set an investor back $43.51.

Over the last 12 months, the companies have changed in value by roughly +134%, +61%, -17%, +113%, and 99%, respectively.

The market capitalisations of these ASX shares range from $3.2 billion to $19.3 billion.

More reading

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• Why the Future First Technologies (ASX:FFT) share price is surging 5%
• Pssst, I’m a value investor who makes money from growth shares: fundie
• Morgans just added these ASX shares to its “best ideas” buy list
• ASX 200 Weekly Wrap: Shares have average week but a great month

Marc Sidarous has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of Reliance Worldwide Limited. The Motley Fool Australia owns shares of and has recommended Brickworks. The Motley Fool Australia has recommended Reliance Worldwide 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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Next Science Ltd (ASX: NXS) shares were on the slide today after the release of the company’s 2021 AGM presentation. By market close, the Next Science share price was trading 2.01% lower at $1.71. This came following gains of almost 5% for the company’s shares yesterday.

Next Science is focused on the research, development and commercialisation of technologies that aim to solve issues in human health caused by biofilms. The AGM was mainly focused on the company’s BlastX wound-treatment products. Let’s dive a little deeper into the presentation.

AGM presentation

Next Science markets itself as “the only company in the world solely dedicated to developing products that resolve biofilm based infections.” The company’s current focus is its wound-care product, BlastX, which has shown significant promise in accelerating the healing of major chronic wounds that are still before the necrotic stage.

The products work at removing pathogens from wound areas. While the company is still seeking some regulatory approvals in key markets, more than 15,000 patients have been treated using its products.

The Next Science share price was in the red today despite the company reporting “returned revenue to growth” in the fourth quarter of 2020. According to Next Science, Q4 revenue showed 75% growth on the same quarter in 2019. The company has commissioned a sales force of over 200 people in the United States and has capital raised $15 million to fund its product commercialisation.

Management comments

Next Science chair Mark Compton briefly admitted the challenges Next Science has faced in the US. He said:

Next Science is a relatively young company, with an exciting future ahead of it. There were many challenges in 2020, with key ones being the health risks to our staff and their families and the sales and marketing constraints of trying to engage a hospital and healthcare system totally focused on dealing with an all-consuming global pandemic that deeply penetrated the US.

As we look back to such a challenging year, I am pleased to report that much progress has been made at Next Science.

Next Science share price snapshot

Despite today’s falls, the Next Science share price has gained almost 30% over the past month. It’s also up by around 37% year to date. Over the past year, however, the company’s shares have only gained 3.64%. Next Science has a current market capitalisation of around $345 million.

More reading

• Why Doctor Care Anywhere, Next Science, NIB, & Talga are charging higher
• Why the Next Science (ASX:NXS) share price opened 40% higher
• Why Alumina, Delorean, Next Science, & Pushpay shares are tumbling lower
• Here’s why the Next Science (ASX:NXS) share price is sinking 6% lower

Lucas Radbourne-Pugh has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of Nexus Energy 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 Lion Energy Ltd. (ASX: LIO) share price was a strong mover today before the company announced a trading halt.

It’s worth noting that the energy producer’s shares soared to an all-time record high of 10 cents. However, some profit-taking led its shares to drop to 9.6 cents, up 20.9% before the halt went into effect.

Why is the Lion Energy share price zooming higher?

A possible catalyst for the rise in Lion Energy shares today could be the release of its green hydrogen strategy presentation.

According to the update, Lion Energy has been busy positioning itself in the production of green hydrogen towards resources and technology markets.

The company established a team of hydrogen experts, which will form a Hydrogen Advisory Board to analyse optimal electrolyser locations in Australia.

The company’s roadmap highlights securing land rights if there is market potential for hydrogen or ammonia. It further noted that it will determine the best value and fit for purpose solar, wind, and electrolyser technology.

In addition, Lion Energy will seek to appoint an experienced feasibility study consultant who can aid on the decision-making process.

The company hopes to establish joint ventures with international firms to build large scale solar/wind farms with energy storage facilities. This in turn would lead to the sale of green hydrogen to domestic and international markets.

Lion executive chair, Tom Soulsby commented:

We are excited to venture into green hydrogen to participate in the energy transition and to leverage Australia’s comparative advantage in renewable energy. We are actively working on delivering against our objectives stated above and will make further announcements in due course.

So why is Lion Energy in a trading halt?

In late afternoon trade, Lion Energy shares were placed in a trading halt at the request of the company.

In the release, Lion Energy cited Chapter 11 of the ASX listing rules to the green hydrogen strategy.

According to the ASX, Chapter 11 falls under the title of ‘Significant transactions.’ This essentially means if a company proposes to make a significant change to the nature of its activities, it must provide details to the ASX before the change.

While the reason for the halt is somewhat ambiguous, investors will have to wait until this Friday or before to find out. It is expected once the announcement is provided to the ASX, the trading halt will be lifted.

Lion Energy share price summary

The Lion Energy share price continued its impressive run today before going into a trading halt. The company’s shares have accelerated over 440% in the past 12 months, with close to 300% on year-to-date gains.

Lion Energy commands a market capitalisation of roughly $23 million, with approximately 238.5 million shares on issue.

More reading

• Why the Lion Energy (ASX:LIO) share price is soaring 65% today
• Here’s why Lion Energy (ASX:LIO) shares rocketed 132% this morning

Motley Fool contributor Aaron Teboneras 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 Nasdaq-100 (INDEXNASDAQ: NDX) is an index that many ASX investors would be familiar with. The Nasdaq houses some of the largest (and arguably, best) tech companies on the planet. The likes of Facebook Inc (NASDAQ: FB), Apple Inc (NASDAQ: AAPL), Microsoft Corporation (NASDAQ: MSFT), Tesla Inc (NASDAQ: TSLA), and Alphabet Inc (NASDAQ: GOOG)(NASDAQ: GOOGL) all call the Nasdaq home. Oh, as does Amazon.com Inc (NASDAQ: AMZN).

The only problem for ASX investors is that the Nasdaq, as you might have gathered by now, is an American exchange. As such, its companies are not available on the ASX. Well, not directly.

The BetaShares Nasdaq 100 ETF (ASX: NDQ) is available on the ASX however. This exchange-traded fund (ETF) is designed to mirror the Nasdaq 100 Index in Australian dollar terms. It contains all 100 of the top companies on the Nasdaq 100, including all of the tech giants mentioned above. Some other notable names that this ETF holds are PepsiCo, Inc (NASDAQ: PEP), NVIDIA Corporation (NASDAQ: NVDA), Netflix Inc (NASDAQ: NFLX), and PayPal Holdings Inc (NASDAQ: PYPL).

This ETF has been a top performer for its investors too. Since its inception in 2015, NDQ has returned an average of 21.01% per annum. Over the past 5 years, that expands to an average of 24.67% per annum. 3 years? 26.53%. And over the past year, we’re looking at a return of 34.9%.

Not bad, one could objectively say.

Tech pullback a buying opportunity for NDQ?

So why is this tech ETF looking enticing today? Well, it’s enjoying something of a rare pullback. NDQ units have lost around 3.8% since mid-April. As you might have gathered from the statistics above, this index does not seem to do pullbacks often. At least in recent years. This most recent pullback seems to be as a result of concern over future inflation — and the rising interest rates that tend to come with it.

The ASX is a top share market. But it doesn’t do well, market capitalisation wise, in the technology space, at least compared to the US markets. That’s where this ETF could prove useful for an ASX investor looking for more exposure: almost half of NDQ’s holdings are in the information technology sector.

NDQ charges a management fee of 0.48% per annum.

More reading

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• FAANG stocks crushed earnings; here’s another great reason to buy them
• Better buy: Alphabet vs. Twilio
• Here are the US shares that ASX investors were buying last week
• a2 Milk and Zip were among the most traded ASX shares last week

Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. Teresa Kersten, an employee of LinkedIn, a Microsoft subsidiary, is a member of The Motley Fool’s board of directors. Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to its CEO, Mark Zuckerberg, is a member of The Motley Fool’s board of directors. Sebastian Bowen owns shares of Alphabet (A shares), Facebook, PepsiCo, and Tesla. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and recommends Alphabet (A shares), Alphabet (C shares), Apple, Facebook, Microsoft, Netflix, NVIDIA, PayPal Holdings, and Tesla. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of BETANASDAQ ETF UNITS and recommends the following options: short March 2023 $130 calls on Apple, long March 2023 $120 calls on Apple, and long January 2022 $75 calls on PayPal Holdings. The Motley Fool Australia has recommended Alphabet (A shares), Alphabet (C shares), Apple, BETANASDAQ ETF UNITS, Facebook, Netflix, NVIDIA, and PayPal Holdings. 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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Fortunately, in this low interest rate environment, there are countless dividend shares for investors to choose from on the Australian share market.

But with so many to choose from, it can be hard to decide which ones to buy. To narrow things down, I have picked out three ASX dividend shares that brokers think investors should buy:

Infomedia Limited (ASX: IFM)

According to a note out of Credit Suisse, its analysts have retained their outperform rating and lifted their price target on this automotive software company’s shares. This follows news that it has agreed to acquire SimplePart for up to US$45 million. The broker sees a lot of positives in the acquisition and expects it to be accretive to earnings from FY 2022. Looking ahead, Credit Suisse is forecasting dividends of 4.1 cents per share in FY 2021 and 5.9 cents per share in FY 2022. Based on the latest Infomedia share price of $1.59, this will mean fully franked yields of 2.6% and 3.7%, respectively.

Nick Scali Limited (ASX: NCK)

A note out of Citi reveals that its analysts have retained their buy rating and $12.05 price target on this furniture retailer’s shares. The broker was pleased with Nick Scali’s trading update and notes that trading conditions appear stronger than expected. Based on this and the booming housing market, it feels its FY 2022 forecasts are very conservative. And while it expects Nick Scali’s earnings to decline next year after a bumper FY 2021, it still feels its shares are attractively priced. Furthermore, they offer generous yields in a low interest rate environment. Citi is forecasting dividends per share of 80 cents and 48.6 cents over the next two years. With the Nick Scali share price currently fetching $10.31, this will mean fully franked yields of 7.8% and 4.7%, respectively.

Transurban Group (ASX: TCL)

Analysts at Macquarie have retained their outperform rating and $14.51 price target on this toll road operator’s shares. According to the note, the broker points out that traffic on its roads has been improving since the start of the year. Positively, it feels an improving economic environment is supporting a recovery in road traffic and expects further improvements to come. Particularly as domestic tourism increases and supports traffic on its roads connecting with airports. Macquarie is expecting Transurban to pay a 40.2 cents per share distribution this year and then a 52.1 cents per share distribution in FY 2021. Based on the current Transurban share price of $14.05, this will mean yields of 2.9% and 3.7% for investors over the next two years.

More reading

• Is the Transurban (ASX:TCL) share price a buy for dividends?
• Why AnteoTech, Domain, Flight Centre, & Nick Scali are sinking today
• Why De Grey, Infomedia, Northern Star, & SEEK shares are storming higher
• Why the Infomedia (ASX:IFM) share price is on the rise today
• Why the Nick Scali (ASX:NCK) share price will be on watch today

James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of Infomedia. The Motley Fool Australia owns shares of Transurban Group. The Motley Fool Australia has recommended Infomedia. 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 4DMedical Ltd (ASX: 4DX) share price has spent much of this year falling from grace after a stellar end to 2020.

After the company completed its initial public offering (IPO) in August 2020, its shares grew a whopping 71% to reach their highest ever closing price of $2.72 ­by mid-October.

After that, 4DMedical shares were incredibly volatile until the start of the new year, when their mostly downward spiral began.

Over the course of 2021, the 4DMedical share price has fallen by more than 38%.

So, what’s been happening with the medical imaging company? Let’s take a look.

What is 4DMedical?

4DMedical is a software company that specialises in software for medical purposes.

Its crown jewel is its four-dimensional lung imaging software. The software integrates with existing x-ray equipment to convert traditional x-rays into four-dimensional scans.

The software allows 4DMedical to deploy a suite of respiratory diagnostic products across its network of clinics and hospitals.

It’s also developing the world’s first lung function scanner which will allow for safe, easy and fast lung analysis for both adults and children.

What drove 4DMedical’s growth?

The company gained the attention of ASX investors in the final months of 2020. Its share price went from $1.59 on its first day listed, to $2.43 by the end of the year.

4DMedical shares really started to grow exponentially after the company was involved in the Goldman Sachs Healthcare Forum on 8 October.

Goldman Sachs pointed to a number of positives in the company’s business model. It said that current diagnostics are outdated in the lung-health sector, which has a US$31 billion per annum global market. The 4DMedical share price jumped almost 43% between 7 and 9 October alone.

4DMedical’s software had also received TGA approval late in September. Furthermore, on 18 December the company’s software completed its first commercial scan in Australia.

4DMedical shares on the slide

Since the beginning of 2021, the 4DMedical share price has been generally trending downwards, despite what appears to have been a raft of good news.

In late January, the company announced its lung diagnostic software was to commence its first clinical pilot in the US.

The following day, 4DMedical shared its quarterly activities report for the second quarter of the 2021 financial year, which was largely positive.

4DMedical released its maiden half-year results in February. While its results showed a simultaneous increase in losses and a decrease in profits, the company’s management stated this was part of its plan.

In March, 4DMedical received a government grant and began a capital raising program. The grant was from the federal government and worth $28.9 million. 4DMedical also shared it would complete a $40 million capital raising project. The company said the cash would be used to develop the world’s first lung function scanners, providing safe, easy and rapid lung analysis for adults and children.

A few weeks later, the company completed another capital raising, this time a share purchase plan worth $6 million.

Despite releasing a stable third-quarter report in late April, the 4DMedical share price can now be found resting at $1.49. Only time will tell if it will return to its former glory. 

More reading

• 4DMedical (ASX:4DX) share price wobbles on quarterly report

Motley Fool contributor Brooke Cooper 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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ASX copper shares have broadly outperformed over the past year.

With soaring copper prices, industry heavyweight Oz Minerals Limited (ASX: OZL) has seen its share price surge 187% over the past 12 months.

The Sandfire Resources Ltd (ASX: SFR) share price is up 64% at that same time, delivering more than twice the gains posted by the S&P/ASX 200 Index (ASX: XJO).

But ASX copper shares could be in for some trouble. After widely rallying for much of the past year, the party may be nearing its end.

That’s according to the latest supply and demand forecast from the International Copper Study Group (ICSG).

Is the copper price a bubble?

Economics 101 dictates that when demand for an asset is strong and supply is tight, prices rise. Conversely, when the supply of an asset exceeds ready demand, prices tend to fall.

Many analysts continue to predict surging demand and constricted supplies of copper over the next several years. But ICSG revealed on Monday that the Group has a decidedly different outlook. It forecasts that copper supplies will exceed copper demand in the latter half of this year and into 2022.

Responding to that assertion, Daniel Briesemann, an analyst at Commerzbank AG, wrote in a note (sourced by Bloomberg):

This assessment of the ICSG contrasts sharply with those of many other market participants, who envisage another seriously undersupplied copper market this year. If the ICSG turns out to be right, the high copper price would not be justified from a fundamental perspective and should be noticeably lower.

ASX copper shares hoping Goldman Sachs is right

ASX copper shares (and their shareholders) will be pinning their hopes on Goldman Sachs’ copper price forecast over ICSG’s.

Citing an inelastic supply for commodities like copper (you can’t dig a new mine overnight), along with soaring demand for the red metal from the global clean energy transition and infrastructure splurge, Goldman is decidedly bullish on copper.

Goldman forecasts copper will fetch US$11,000 per tonne inside of 12 months. It’s currently trading for US$9,996 per tonne.

Looking further ahead, Goldman is predicting copper will reach US$11,875 per tonne in 2022 and edge still higher to US$12,000 per tonne in 2023.

If ICSG is correct, however, copper prices will likely be much lower. And ASX copper shares could see their share prices come under pressure.

ICSG doesn’t foresee any significant increase in copper demand this year, while it forecasts an increase in new supply from copper mines. Although ICSG didn’t provide any future price estimates, Bloomberg reports that the Group expects “the global refined copper surplus will reach 110,000 tons in 2022 from about 80,000 tons in 2021”.

In 2020 there was a copper deficit of approximately 600,000 tons. That deficit helped drive a 62% increase in the price of copper since 3 January 2020.

Depending on which forecasts prove closer to the truth, ASX copper shares could be facing welcome tailwinds or battling unwelcome headwinds in the year ahead.

More reading

• ASX stock of the day: Brickworks (ASX:BKW) shares top the ASX 200
• Here’s how much ANZ’s (ASX:ANZ) dividend is worth now
• ASX 200 jumps 0.7%: ANZ half year results, Nearmap jumps
• 5 things to watch on the ASX 200 on Wednesday
• ASX 200 rises, Flight Centre drops, Super Retail grows

Motley Fool contributor Bernd Struben 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 Resimac Group Ltd (ASX: RMC) share price is etching higher today after the company settled another $1 billion bond-lending deal.

Resimac shares are up 1.26% to $2.42 at the time of writing.

Resimac is a major Australian non-bank lending company, specialising in residential mortgage lending and multi-channel aspects of the distribution business, like prime and specialist lending.

Let’s take a look at what’s driving the Resimac share price today.

Resimac’s latest deals

Resimac announced the financial close of its non-conforming residential mortgage-backed securities (RMBS) transactions in the 2021 ‘Resimac Bastille Series’. This is Resimac’s second RMBS transaction for 2021 and represents 30% of its total non-conforming funding.

As Resimac group treasurer Andrew Marsden explained:

This deal supports the market-leading offering that Resimac provides to self-employed borrowers and borrowers who fall outside traditional lending guidelines.

Resimac’s growth aspirations are supported by strong demand for RMBS in the capital markets, with sound underlying credit performance as business conditions improve.

RMBS deals are bonds and can be seen as similar to tranche-based mortgage lending in the sense that the bonds are secured against a large pool of residential mortgage loans.

Specifically, they’re interest-backed debt facilities, that are financed by the interest Resimac customers pay the company on their mortgage loans. Resimac has now sealed $1 billion valued RMBS transaction deals for the past three months running.

More on Resimac’s scope

The Resimac group operates in targeted market segments and asset classes in Australia and New Zealand. Its bread and butter is home loans and was named the non-bank lender of the year in 2020. The company has more than 50,000 customers with a portfolio of home loans worth close to $13 billion and assets under management of more than $15 billion.

Resimac also has issued more than $35 billion of mortgage-backed securities in domestic and global markets since 1987 and works closely with multiple major banks.

Resimac share price snapshot

The Resimac share price has performed well over the past 12 months, lifting 190%. Its upward trajectory has slowed somewhat this year, but Resimac shares are still up 11% since the start of 2021.

More reading

• Aussie adds digital home loans in an effort to keep up with the big four

Motley Fool contributor Lucas Radbourne-Pugh 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 Octanex Ltd (ASX: OXX) share price is surging today after the company announced its exploration program funding has been secured.

Octanex shares are currently trading 11.66% higher at 6 cents per share, after lifting by as much as 28% earlier today.

Octanex is a microcap oil and gas company engaged in exploring and production activities in offshore Western Australia. The company’s projects include the Ophir oil field, Greater cornea fields, and the Ascalon gas discovery.

Octanex’s new exploration funding

The company raised the exploration funds through successfully completing a capital raising placement. The placement consisted of 15,000,000 ordinary fully paid shares at 5 cents per share with one-for-two unlisted options, to raise $750,000 (before costs).

The company acquired the capital through sophisticated and professional investors, which were introduced through a private equity firm.

According to the company, the funds raised will be used to advance exploration at the company’s projects, particularly its Sefton Project initiative where the company has established an extensive tenement position in this region where there is very little modern exploration.

Octanex management comments

Octanex Chair, Geoff Albers, explained further how the funds will be used:

The placement funds will be used to advance our knowledge of the company’s Sefton Project tenements. It will be an exciting period ahead for Octanex as we initiate our planned programs to unlock the geology of our tenements. Octanex thanks new and existing shareholders for their support. We look forward to delivering on our exploration programs.

Octanex share price snapshot

The Octanex share price has lost 17% overall the past week despite today’s huge gains, but is still up a whopping 120% this month, and 450% over the past 12 months.

More reading

• Resimac (ASX:RMC) share price lifts after settling another $1 billion deal
• APA (ASX:APA) share price falls despite expansion and new agreement
• Why the Podium Minerals (ASX:POD) share price soared 27% today
• Top broker tips Super Retail (ASX:SUL) share price to smash the market
• Afterpay (ASX:APT) share price tumbles despite investor presentation

Motley Fool contributor Lucas Radbourne-Pugh 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 APA Group (ASX: APA) share price is down today despite the company announcing two positive updates.

At the time of writing, the energy infrastructure company’s shares are swapping hands for $9.98, down 0.30%.

Let’s take a closer look and see what APA released to the ASX.

East Coast Grid pipeline network expansion

According to its release, APA advised that it will begin expanding capacity on its East Coast Grid. This will link Queensland with southern markets. This follows a Final Investment Decision (FID) that was reached on the project due to strong customer demand for transportation capacity.

APA projected that without investing in the East Coast Grid, winter gas supply risks could arise from 2023. This was taken in the context of existing contract positions and available capacity, along with market forecasts.

The expansion will be undertaken in two stages, and incur a capital cost of around $270 million. Once completed, winter peak capacity will increase by up to 25% through additional works on both the Southwest Queensland Pipeline (SWQP) and the Moomba Sydney Pipeline (MSP). Both projects are critical in delivering gas from Queensland and the Northern Territory to southern markets.

The first stage of the East Coast Grid is expected to be finished within the first quarter of 2023. The second stage will be staged to meet customer demand, with completion towards the end of that same year.

APA noted that a potential third stage could be included, adding a further 25% transportation capacity. Engineering and design works are continuing to lay out the project scope and format.

APA CEO and managing director, Rob Wheals commented:

Through the investments we’re making today in the staged 25% expansion of the East Coast Grid, APA is playing a critical role in delivering additional energy security for southern gas markets ahead of forecast supply risks.

Today’s announcements reinforce the competitiveness of APA’s East Coast Grid and the critical role it plays in delivering for our customers and for the economy through cost effective, safe and reliable transportation of Australian domestic gas from northern gas producers to southern markets.

New East Coast Grid agreement

In further news, APA revealed that it has signed a new deal with a leading energy provider, Origin Energy Ltd(ASX: ORG).

The Gas Transportation Agreement (GTA) will see APA support Origin Energy’s needs in the southern markets. The contract is set to commence on 1 January 2023, before the completion of the East Coast Grid pipeline network expansion.

APA highlighted that under this agreement, Origin could potentially supply over half of New South Wales’ winter demand for gas.

The agreement will run for an initial 3-year period with an option to extend by a further two years. It is assumed that the initial deal will generate roughly $190 million in revenue for APA.

About the APA share price

The APA share price has fallen 10% since this time last year, however, year-to-date performance is marginally higher at 3%.

APA has a market capitalisation of about $11.8 billion, with more than 1.18 billion shares on issue.

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Motley Fool contributor Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of APA Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

The post APA (ASX:APA) share price falls despite expansion and new agreement appeared first on The Motley Fool Australia.

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