Although the Australian share market is trading within sight of its 52-week high, not all shares are performing as positively.

Three ASX shares that are trading notably lower than their highs are listed below. Here’s why they could be great value now:

Appen Ltd (ASX: APX)

The first ASX share to look at is Appen. It is a leading developer of high-quality, human annotated datasets for machine learning and artificial intelligence (AI). This is a vital part of the development process of building AI models, as without quality data a model won’t reach its full potential. Given the growing importance of AI for businesses and governments, Appen looks well positioned for growth over the long term. And with the Appen share price down 58% from its high, now could be an opportune time to make a patient investment. Ord Minnett appears to believe this is the case. It has just upgraded its shares to a buy rating with a $24.75 price target.

CSL Limited (ASX: CSL)

Another ASX share to consider is CSL. The shares of this leading biotechnology company are down 21% from their 52-week high. This has been driven by concerns over plasma collection headwinds because of COVID-19. However, with this headwind only temporary and not structural, the company looks well-placed to bounce back strongly after the pandemic passes. Especially given its in-demand therapies and vaccines and its lucrative R&D pipeline. Analysts at Citi are positive on CSL. Last week they upgraded its shares to a buy rating with a $310 price target.

Kogan.com Ltd (ASX: KGN)

A final ASX share to look at is this leading ecommerce company. The Kogan share price has fallen heavily this year and is now down 45% from its high. This appears to have been driven by valuation concerns and uncertainty regarding how long its elevated sales growth will be maintained. Analysts at Credit Suisse remain positive on its future and believe its shares are good value. at current levels The broker has recently put an outperform rating and $20.85 price target on Kogan’s shares.

More reading

• Why ASX e-commerce shares could keep running higher in 2021
• ASX 200 up 0.8%: Metcash update, tech shares rebound, PointsBet acquisition
• Share market on watch over AstraZeneca vaccine fears
• ASX 200 Weekly Wrap: Calm restored to the ASX 200
• 2 amazing ASX tech shares to buy right now

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 Appen Ltd and CSL Ltd. The Motley Fool Australia owns shares of and has recommended Kogan.com 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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No, you’re not in an alternate universe, but living in a simulation sounds closer to the truth with every Elon Musk tweet. After pinching yourself, we can confirm the above statement is official.

A filing to the United States Securities and Exchange Commission yesterday (SEC) by Tesla Inc (NASDAQ: TSLA) enacted the title amendments.

New name, same position

We all know someone guilty of exaggerating their position title to a certain extent. Technoking though – that has to take the cake. Well, it doesn’t end there – Tesla’s Chief Financial Officer Zach Kirkhorn now has the title ‘Master of Coin’.

Despite the new and weird titles, Elon Musk and Zach Kirkhorn will maintain their mundane positions as Chief Executive Officer and Chief Financial Officer.

You might be thinking, “Well what’s the point then?”. Currently, the purpose behind the title change is unknown. Frankly, there may not be a reason other than for the sake of a meme.

However, some have drawn conclusions that Elon’s Technoking title is derived from his enjoyment of techno music. In regard to Zach’s title, it might have something to do with Tesla’s purchase of US$1.5 billion Bitcoin (CRYPTO: BTC) in January. Potentially the recent milestone of Bitcoin hitting new all-time highs evoked the action.

Busy times for Technoking Elon Musk

Changing titles is only the beginning for Elon Musk over the past month. As technology shares lost favour and Tesla shares plunged 35%, Musk fell out of the number one spot on the rich list.

Although, this certainly didn’t slow down operations within SpaceX. During the past month, SpaceX has continued to complete three successful Falcon 9 launches and a landing of Starship (SN10), which proceeded to explode 8 minutes later.

Yet somehow the busy futuristic thinker had time to put together a non-fungible-token (NFT). It seems Technoking Musk is looking to sell it for the right price. Any takers?

I’m selling this song about NFTs as an NFT pic.twitter.com/B4EZLlesPx

— Elon Musk (@elonmusk) March 15, 2021

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

More reading

• ASX investors still can’t get enough of GameStop (NYSE:GME) shares
• Could this be the pin to pop the Bitcoin (CRYPTO:BTC) bubble?
• Here’s why the Altech (ASX:ATC) share price is rocketing 11%
• Bitcoin (CRYPTO:BTC) hits another record high. What’s going on?
• Tesla shareholder sues Elon Musk over losses

Mitchell Lawler owns shares of Bitcoin and Tesla. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and recommends Bitcoin and Tesla. 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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Most weeks, the Commonwealth Bank of Australia (ASX: CBA) CommSec brokering platform tells us the ASX and international shares (almost always just US shares) that are the most popular with its Australian customers.

CommSec is among the most popular share trading platforms in the country. As such, the data it gives us can be a useful snapshot into the mind of the average Aussie investor.

Today, we have already looked at the most popular ASX shares last week. So here are the top 10 United States shares CommSec customers were buying last week. This week’s data covers 8-12 March. 

GameStop shares among most traded US shares on the ASX

1. Tesla Inc (NASDAQ: TSLA) – representing 7.6% of total trades with an 81%/19% buy-to-sell ratio.
2. GameStop Corp (NYSE: GME) – representing 5.4% of total trades with a 51%/49% buy-to-sell ratio.
3. Apple Inc (NASDAQ: AAPL) – representing 2.8% of total trades with an 83%/17% buy-to-sell ratio.
4. Nio Inc (NYSE: NIO) – representing 2.6% of total trades with a 76%/24% buy-to-sell ratio.
5. Palantir Technologies Inc (NYSE: PLTR) – representing 1.8% of total trades with an 84%/16% buy-to-sell ratio
6. Roblox Corp (NYSE: RBLX)
7. ARK Innovation ETF (NYSE: ARKK)
8. AMC Entertainment Holdings Inc (NYSE: AMC)
9. Taiwan Semiconductor Manufacturing Co Ltd (NYSE: TSM)
   
10. Microsoft Corporation (NASDAQ: MSFT)

What can we learn from these trades?

Well, GameStop certainly knows how to excite Aussie investors, that’s for sure. GameStop was on last week’s list, at the number four spot with a buy/sell ratio of 68%/32% to be precise. So it’s interesting to see a convergence of buyers and sellers.

Since 5 March (the end of last week’s covered period), the GameStop share price is up another 59% on current pricing, but has also lost around 17% of its value since 10 March. It seems that is enough to get half of its Aussie investors to move to take their profits off of the table.

Outside GameStop, electric vehicle and battery manufacturers Tesla and Nio remain as popular as ever. Both companies have been recovering somewhat after being hard-hit in the US tech selloff of the past month or so.

It’s also interesting to see that data company Palantir remains popular with Aussies, even though the company is still down around 30% from where it was on 9 February.

Some new faces this week are Roblox and Taiwan Semiconductor. Taiwan Semiconductor is a massive high-flying chip manufacturer that has recently come off the boil. It was down close to 20% from it’s February peak at one point, so clearly some Aussies are seeing a bargain here.

Roblox is a new gaming company that has only just IPOed in the past week on the US markets. Clearly, Aussies have been excited to get aboard this train.

At the time of writing, Roblox stock remains around 3.8% above the level it debuted on the New York Stock Exchange at, so it’s been a winner so far.

More reading

• Elon Musk reviews title and decides ‘Technoking of Tesla’ is more fitting
• Is the cashed up Reddit army forming for a new charge?
• We’ll get 7.8% yield from ASX this year, says investment pro
• Here’s why the Altech (ASX:ATC) share price is rocketing 11%
• Bitcoin (CRYPTO:BTC) hits another record high. What’s going on?

Teresa Kersten, an employee of LinkedIn, a Microsoft subsidiary, is a member of The Motley Fool’s board of directors. Sebastian Bowen owns shares of Tesla. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and recommends Apple, Microsoft, Taiwan Semiconductor Manufacturing, and Tesla. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of NIO Inc. and Palantir Technologies Inc and recommends the following options: short March 2023 $130 calls on Apple and long March 2023 $120 calls on Apple. The Motley Fool Australia has recommended Apple. 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 RPMGlobal Holdings Ltd (ASX: RUL) share price is up this afternoon, after the company announced it exceeded the revenue stated in its half year investor presentation. At the time of writing, the RPMGlobal share price was up 8% to $1.31.

RPMGlobal is a developer and provisioner of software for the mining industry. It also provides advisory services and professional development to industry members.

Let’s look at what was announced this afternoon.

Revenue update

RPMGlobal updated its total contracted value (TCV) and annual recurring revenue (ARR) derived from software subscriptions sold during the 2021 financial year.

The update included an extra $11.5 million of revenue that was not revealed in the company’s half-year investor presentation, released in February 2021.

In February, the company advised that its current software subscription TVC was $14.5 million, whereas today the company confirmed it is actually $23.4 million. 

Further, RPMGlobal advised the company’s ARR from software subscriptions was $15.8 million, when in actuality it was $18.4 million — a difference of $2.6 million.

Additionally, RPMGlobal stated it has not included another $4.1 million of contracted subscription revenue in the provided figures, as those subscriptions are able to be terminated anytime without a fee.

The company also noted it has closed $800,000 worth of perpetual software licenses since December 2020. A perpetual software licence is an agreement that allows a user access to a software indefinitely with a single payment.

More about RPMGlobal

RPMGlobal states that its software is the industry’s only integrated mining operational platform built on industry standards.

The company has offices all over the globe, including in Brisbane, Sydney, Perth, Mackay, Wollongong, and Maitland.

RPMGlobal share price snapshot

At the time of writing, the RPMGlobal share price has risen by 8.26% this afternoon. It is currently sitting at $1.31 after opening at $1.21 this morning.

The RPMGlobal share price is up by 58% over the last 12 months. The company’s share price has broken even, year-to-date, with a 1.9% return.

RPMGlobal has a market capitalisation of around $277 million, with approximately 229 million shares outstanding.

More reading

• Software and bikes: 3 ASX shares ready to explode

Motley Fool contributor Brooke Cooper has no position in any of the stocks mentioned.

The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of RPMGlobal Holdings. The Motley Fool Australia has recommended RPMGlobal 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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Since the beginning of 2021, the S&P/ASX 200 Index has increased 160.7 points or 2.4%. Today, the index is up 1.06% on yesterday’s close. Part of the reason for the booming share market is the flow of cheap money, driven by the RBA.

The central bank has been looking for ways to steer the Australian economy away from another recession. Additionally, it is also aiming towards longer-term growth. In normal times, it would have a relatively light touch – leaving the proverbial ship on autopilot and all making small adjustments when necessary.

However, we’ve been in unchartered waters for over a year now – overwhelmed by the tidal wave that is COVID-19. Even before the pandemic, economic indicators were not strong.

Philip Lowe and the RBA Board concur. Minutes from the March meeting can summarise the mood on the Australian economy as optimistic. While signs of recovery from COVID abound, the RBA still sees many economic icebergs on our voyage.

Let’s take a closer look at the minutes and what they might mean for your investments.

Quantitative Easing to continue

Last month, the board declared it would continue quantitative easing (QE) after April 2021. The initial $100 billion was reserved for the purchasing of government bonds and was due to be exhausted then. Another $100 billion has been allocated and “the Bank is prepared to do more [QE] if that is necessary.”

The central bank believes its policies. In addition to government programs like JobKeeper and HomeBuilder. Both of these programs have contributed to a more robust Australian economy than expected under the circumstances. In 2020, GDP fell by 1.1%.

The ending of JobKeeper at the end of this month was touched on in the meeting. In the view of the board, the cessation of the wage subsidy program will NOT result in a sustained increase in unemployment. It does believe many, including the self-employed, will see a fall in income. The bank based this assessment on the recovering job market. Additionally, it factored in future indicators, “such as job advertisements and vacancies.”

Inflation, wage growth, well below target. Stock market to continue surge

The RBA also affirmed in its forecast that it did not see the official cash rate rising above 0.1% until at least 2024. The board cited weak wages growth and below-target inflation (2-3% is the RBA’s preferred inflation rate) for the forecast. It believes there is still room for more employment in the labour market. Furthermore, until such time as employment materially increases, wages will not grow. The central bank does not believe inflation will materially pick up until wage growth strengthens.

It did note, however, that the consumer price index (CPI) would see a bounce of 3%. This is predicted to come as life returns to normal post-coronavirus. In saying that, the RBA believes inflation will remain below the 2% target over “both 2021 and 2022.”

In these discussions, the RBA is well aware of the effect low-interest rates is having on both financial and housing markets. Quoting from the minutes:

[Board members] acknowledged the risks inherent in investors searching for yield in a low interest rate environment, including risks linked to higher leverage and asset prices, particularly in the housing market. Members noted that lending standards remained sound and that it was important that they remain so in an environment of rising housing prices and low interest rates.

The Board concluded that there were greater benefits for financial stability from a stronger economy, while acknowledging the importance of closely monitoring risks in asset markets.

In other words, the benefits of low-interest rates outweigh the risks of an inflated stock and housing market.

All signs bode well for stock-market investors in the short-term. One beneficiary of a hot property market would be real estate investment trust shares.

The minutes also indicated the RBA were very unlikely to move to a negative cash rate (i.e., an official interest rate below 0%).

Rising bond yields and the stock market

In the meeting, the bank also discussed rising bond yields. The share market has fluctuated widely with rising bond yields and evolving market inflation expectations. While it noted market expectations on inflation and its effect on the bond market, it still believes the case for stronger inflation is weak.

The S&P/ASX All Technology Index is the most susceptible to rising bond yields. This is because as bond yields rise, investors sell riskier assets (like tech shares) and buy safer ones (like bonds). If bond prices fall because market expected inflation never materialises, as the RBA believes, bond-yields are likely to fall. If bond-yields did fall, it would not be unwise to assume that would reflect positively on technology shares.

More reading

• ASX 200 will end this year on a record high
• Why the Coles (ASX:COL) share price is still down 15% in 2021
• These 2 ASX shares are the newest “buy” ideas from top brokers
• ASX 200 up 0.8%: Metcash update, tech shares rebound, PointsBet acquisition
• We’ll get 7.8% yield from ASX this year, says investment pro

Motley Fool contributor Marc Sidarous 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 MyDeal.com.au Ltd (ASX: MYD) share price was out of form again on Tuesday despite a rebound in the tech sector.

The ecommerce company’s shares fell 2.5% to end the day at 93 cents. This compares to a gain of almost 2.5% by the S&P/ASX All Technology Index (ASX: XTX).

This latest decline means the MyDeal share price is now down 22% since this time last month. It also means that the company’s shares are now trading 7% below its October IPO price of $1.00.

Why is the MyDeal share price under pressure?

The recent weakness in the MyDeal share price appears to have been driven by weakness in the tech sector due to rising bond yields.

This has offset a solid half year update in February which saw the ecommerce company deliver very strong sales and customer growth.

For the six months ended 31 December, MyDeal reported a 217% increase in gross sales to $126.7 million and a 248% jump in revenue to $21.2 million.

This strong growth was driven by a 205% increase in active customers to 813,764 and further improvements in repeat use. Approximately 53% of second quarter transactions came from returning customers. This was an increase from 38.5% a year earlier.

Is this a buying opportunity?

One person that appears to believe the MyDeal share price is good value is the company’s Chair, Paul Greenberg.

Earlier this month, Mr Greenberg picked up 100,000 MyDeal shares at $1.08 to $1.11 per share. This lifted the Chair’s holding to a total of just under 1.7 million shares.

A leading broker that would approve of this purchase is Morgans. In response to the company’s half year results last month, the broker retained its add rating and $1.70 price target.

Based on the current MyDeal share price, this price target implies potential upside of almost 83% over the next 12 months.

Morgans was pleased with its performance, strong start to the second half, and its plans to invest in marketing to drive further growth in private label sales.

More reading

• 2 small cap ASX shares to watch closely in 2021
• One person earned $250,000 on Airtasker last year. Now it’s listing
• 2 buy-rated small cap ASX shares with strong growth potential
• Why the MyDeal (ASX:MYD) share price is tumbling lower today
• 2 rapidly growing small cap ASX shares to buy

Motley Fool contributor James Mickleboro 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) will hit an all-time record high this year, according to one prominent economist.

Like most share markets, the ASX had a nice recovery from the COVID-19 lows in March last year. 

But the past month has seen a bond-driven hiccup, with the ASX 200 dropping almost 1.7% and the S&P ASX All Technology Index (ASX: XTX) getting whacked a painful 14%.

AMP Capital chief economist Shane Oliver told investors to ride out the bump, because this year is looking good.

“Shares remain at risk of further volatility from rising bond yields,” he said.

“But looking through the inevitable short-term noise, the combination of improving global growth helped by more stimulus, vaccines and still low interest rates augurs well for growth assets generally in 2021.”

Oliver is so optimistic that he predicted the ASX would end up where it had never gone before.

“Expect the ASX 200 to end 2021 at a record high of around 7200.”

The current all-time high is 7199.79 seen in February last year, just before the market plunged.

Rotation to recovery value sectors will continue

Oliver might think growth stocks will come back in vogue, but the market’s change in taste for certain sectors will continue.

“We are likely to see a continuing shift in performance away from investments that benefitted from the pandemic and lockdowns — like technology and health care stocks and bonds — to investments that will benefit from recovery, like resources, industrials, tourism stocks and financials.”

The shift to the more traditional sectors will mean dividends will rise.

On Monday, Plato Investment Management predicted the ASX 200 would return 4.8% gross yield this year, which wasn’t far off the 4.5% that Oliver forecast.

“Australian shares are likely to be relative outperformers helped by better virus control enabling a stronger recovery in the near term, stronger stimulus, [and] sectors like resources, industrials and financials benefitting from the rebound in growth.”

Internationally, the US markets were the darling of investors in 2020, but expect that to shift to other regions this year.

“Global shares are expected to return around 8% this year but expect a rotation away from growth-heavy US shares to more cyclical markets in Europe, Japan and emerging countries,” said Oliver.

More reading

• Why the Coles (ASX:COL) share price is still down 15% in 2021
• These 2 ASX shares are the newest “buy” ideas from top brokers
• ASX 200 up 0.8%: Metcash update, tech shares rebound, PointsBet acquisition
• We’ll get 7.8% yield from ASX this year, says investment pro
• 5 things to watch on the ASX 200 on Tuesday

Motley Fool contributor Tony Yoo 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 Vulcan Energy (ASX: VUL) share price is up more than 3% today after the miner announced an expert special advisor will join its board. At the time of writing, the Vulcan share price is up 3.29%, trading at $5.59.

Julia Poliscanova is a sustainable battery and CO2 policy expert who has worked with various European Union (EU) entities. Let’s look further into the career of Vulcan’s new advisor.

Julia Poliscanova, sustainable battery and CO2 policy expert

Ms Poliscanova is set to join the Vulcan Energy board as a special advisor. She will help guide the company through EU policy and in its transition to carbon-neutral production.

In today’s release, the company said Ms Poliscanova was currently a senior director with the EU’s Transport and Environment agency. She has played an important role in shaping the EU’s vehicle CO2 standards.

She recently worked to create policies within the EU’s CO2 battery regulations, which effectively banned unsustainable and high-CO2 batteries in the EU.

Ms Poliscanova is also on the steering committee of the Global Battery Alliance, which is working to make battery manufacturing more sustainable and speed up implementation.

Vulcan Energy said her experience managing the CO2 footprint of lithium-ion battery production was highly relevant for the company. Particularly as it aims to create the world’s first carbon-neutral lithium project.

Ms Poliscanova said she was pleased to be appointed as an advisor to the board of the “future-focused” Vulcan.

Vulcan is at the centre of both renewable energy and EU-sourced sustainable lithium for batteries and is a great example of the private sector corporate action required to help the EU achieve its zero emissions goals.

The EU policies on batteries have been designed to encourage exactly these types of sustainable, long term, green solutions.

Commentary from management

Vulcan chairman Gavin Rezos welcomed Ms Poliscanova as an advisor to the Vulcan board.

Julia’s work shaping and creating EU policy in this field has been vital in making sure Europe manages the transition to e-mobility in the right way, by ensuring zero carbon production of lithium-ion batteries, including the constituent raw materials such as lithium.

Managing Director Dr Francis Wedin said he looks forward to Ms Poliscanova’s insights into public policy.

This forward-thinking policymaking matches our core strategy to produce a world-first zero-carbon lithium for the European battery electric vehicle market, and in doing so to build a combined renewable energy and zero carbon chemicals business.

Vulcan share price snapshot

The past year has been a good one for Vulcan Energy’s share price. It’s currently up 3357% over the past 12 months and by 137% year to date.

Based on its current share price, Vulcan Energy has a market capitalisation of around $685 million. It has approximately 107 million shares outstanding.

More reading

• Mining companies with ESG strategies are at the front of the pack
• Vulcan Energy (ASX: VUL) share price up as revenue soars over 1,000%
• Why the Vulcan Energy (ASX:VUL) share price is jumping 12% today
• The Vulcan Energy (ASX:VUL) share price has fallen 17% in 2 weeks
• Vulcan (ASX:VUL) share price slumps despite new partnership

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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The Regional Express Holdings Ltd (ASX: REX) share price was a very positive performer on Tuesday.

The regional airline operator’s shares rose 4% to $1.69.

This latest gain means the Regional Express share price has now more than doubled over the last 12 months.

Why did the Regional Express share price storm higher?

Investors were buying Regional Express shares on Tuesday following the release of an update on its agreement with PAG Regulus.

According to the release, the company has completed its investment transaction with PAG Regulus to raise up to $150 million to be used exclusively to fund its domestic operations.

The first tranche of $50 million has been drawn down and secured convertible notes have now been issued to PAG Regulus. The remaining $100 million of the funding will be available for drawdown over the following three years.

What is the funding for?

The funding from the deal with PAG Regulus will be used to support the launch of Rex’s domestic jet operations. These are aiming to compete with Qantas Airways Limited (ASX: QAN) and Virgin Australia on some major routes.

In November Regional Express announced the agreement with PAG Regulus. At the time, Rex’s Executive Chairman, Lim Kim Hai, explained the rationale for the deal.

He said: “PAG is a well-respected and highly successful investment group which manages more than USD40 billion on behalf of major global institutional investors. I look forward to tapping into the experience and expertise of PAG’s nominated directors whose professionalism I have grown to respect over the last few months of extensive discussions.”

“Preparations for our domestic operations are proceeding to plan with our first Boeing 737 800NG aircraft delivered on 5 November 2020. Our crew will carry out training on the aircraft over the next 3 weeks before the CASA proving flight on 2 December 2020. We anticipate CASA approval shortly after. Five other similar aircraft will be delivered from next month to March 2021.”

“We will debut on the Sydney – Melbourne route with 3 aircraft on 1 March 2021 and will ramp up to 5 aircraft by Easter that will see flights to other capital cities. Once the initial services are well established, we aim to progressively grow our fleet to cover all the major cities in Australia.”

More reading

• Qantas (ASX:QAN) successfully trials COVID vaccine app in preparation of return to international travel
• Regional Express (ASX:REX) share price takes off despite loss warning
• Why did Qantas (ASX:QAN) shares soar 4% on Tuesday?

Motley Fool contributor James Mickleboro 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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You may have heard that our counterparts in the United States are about to receive some fat cheques in the mail, courtesy of Uncle Sam. It’s all part of the US$1.9 trillion (AU$2.5 trillion) pandemic recovery bill US President Joe Biden managed to get through Congress. And it will see every eligible person (those making less than US$75,000 per year individually or couples making up to US$150,000 per year) receive a stimulus cheque of US$1,400. If your kids or dependent parents live with you, they get a US$1,400 cheque too.

While similar measures haven’t been embraced by the Australian government, come tax time many Aussies will see a big lift in their tax refunds.

Many analysts are predicting this could be the fuel that ignites the next retail army trading craze.

Cheques set to pour into shares

As Bloomberg reports, Sam Stovall, the chief investment strategist at CFRA Research says the government stimulus cheques “could offer a short-term ‘shot in the arm’ to a market that was otherwise looking run-down and vulnerable to a sell-off.”

Eric Liu, co-founder of Vanda Research, agrees. He said, “stimulus checks will almost certainly drive more retail buying. The social media attention has remained strong.”

A Deutsche Bank survey earlier this month revealed that 50% of individuals in the 25–34 age range who have brokerage accounts expect to use half the money from the stimulus cheques to buy shares.

Twenty-eight-year-old actress, Iyana Halley, falls right into that category. She says (quoted by Bloomberg):

I probably will take about half of it to invest into stocks… I want to see what will make the most sense, where I can get the most out of my money. I’m still new to the stock-market world, so trying to figure stuff out.

She said she uses guidance from trusted friends and social media to help decide which shares to buy.

That kind of investment attitude has Kimberly Woody, a senior portfolio manager at GLOBALT Investments, sounding a cautionary alarm. According to Woody, “you could say it’s like gasoline on a fire. [It’s] participation from a lot of folks that really just don’t know what they’re doing.”

Wise words…

GameStop stalled…but not out yet

Now the new wave of cashed-up Reddit traders hasn’t hit the GameStop Corp. (NYSE: GME) share price yet. Perhaps the loose collective of retail trader will find another share to target. Or not…

Yesterday, overnight Aussie time, GameStop shares plummeted 16.8% to US$220.14 per share. In after-hours trading, shares are down another 1.2%.

That’s a big daily loss. But it’s not even close to erasing the meteoric gains GameStop enjoyed this year. Over the past month, shares are still up 345%. And since the beginning of 2021, the GameStop share price is up a stellar 1,176%.

Where will the Reddit army deploy next? Stay tuned.

More reading

• Saxo Bank CEO on the “seismic shift” in ASX retail investors
• Here are the US shares ASX investors have been buying
• Goldman Sachs CEO: GameStop share price and the Reddit phenomenon
• Subreddit ASX Bets is gambling these 4 ASX shares will follow in GameStop’s footsteps
• The risky nature of Robinhood style day trading revealed

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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