If you’re looking to invest in some ASX blue chip shares, then I would suggest you take a look at the two listed below.

Here’s why I think they are among the highest quality options for blue chip investors to choose from right now:

Ramsay Health Care Limited (ASX: RHC)

Trading conditions have been tough for Ramsay Health Care in 2020 because of the pandemic. However, I believe it is worth looking beyond this short term pain and focusing on the long term. Thanks to its world class network of private hospitals, I believe it is positioned to benefit from the expected increase in demand for healthcare services in the future. This is due to ageing populations, increased chronic disease burden, and advancements in treatments.

Another positive is the company’s penchant for acquisitions. Over the last decade or two the company has been acquiring its way into new markets. Combined with organic growth, this has underpinned solid earnings growth over the long term. Pleasingly, I expect more of the same over the next decade or two. I feel this could mean the Ramsay share price provides investors with strong total returns over the long term.

REA Group Limited (ASX: REA)

A final blue chip ASX share to buy is this property listings company. Like Ramsay, times have been hard for REA Group recently. As well as contending with a housing market crash in the late 2010s, it has had to battle the pandemic in 2020. But, amazingly, it has managed to still deliver solid earnings growth through these periods.

So with house prices tipped to rise next year once the pandemic passes, trading conditions could be about to improve greatly. I expect this to lead to higher listing volumes and an acceleration in its profit growth in the coming years. Especially given new revenue streams, costing cutting, and price increases.

In addition to this, the company recently increased its interest in India-based Elara Technologies to a controlling level. This could be a big boost to its revenues in the late 2020s. Management commented: “With over 700 million internet users and roughly half a billion yet to come online, our increased investment in Elara will allow REA to be at the forefront of the considerable long-term opportunities within India, and the digitisation of the real estate sector.”

More reading

• 4 outstanding ASX 200 shares to buy with $4,000
• Is the REA Group (ASX:REA) share price a buy?
• ASX 200 sinks 1.6%, ANZ (ASX:ANZ) reports FY20 result
• Why market crashes are useful for buying ASX dividend shares
• REA Group (ASX:REA) share price in focus amid acquisition news

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Ramsay Health Care Limited and REA Group Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The post Why I would buy REA Group and this ASX blue chip share appeared first on Motley Fool Australia.

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I think exchange traded funds (ETFs) can be great additions to a balanced portfolio.

This is because they give investors easy access to a large and diverse number of different shares through just a single investment.

There are a lot of ETFs for investors to choose from, so which should you buy? Three of the best in my opinion are listed below. Here’s why I like them:

BetaShares NASDAQ 100 ETF (ASX: NDQ)

The BetaShares NASDAQ 100 ETF is my favourite ETF. It gives investors exposure to 100 of the largest non-financial companies on the Nasdaq index. This means investors will be getting a slice of some of the biggest and most iconic companies in the world. Among its holdings are the likes of Amazon, Apple, Facebook, Microsoft, Netflix, and Tesla. Given the quality of these companies and their very positive outlooks, I expect the Nasdaq 100 ETF to generate strong returns for investors over the next decade.

VanEck Vectors Australian Banks ETF (ASX: MVB)

If you’re looking for exposure to the banking sector, then you might want to look at the VanEck Vectors Australian Banks ETF. This ETF gives investors a piece of all the big four banks, the regionals, and also investment bank Macquarie Group Ltd (ASX: MQG) through a single investment. I think this is great for investors that are unsure which of the banks they want to invest in. Another positive with the ETF is its generous dividend. I expect when bank dividends return to normal, it could yield somewhere in the region of 5% or more.

VanEck Vectors China New Economy ETF (ASX: CNEW)

A final ETF I think investors should look at is the VanEck Vectors China New Economy ETF. This fund gives exposure to the growing Chinese economy through a portfolio of 120 exciting companies which are in sectors making up the New Economy. This includes the technology, health care, consumer staples, and consumer discretionary sectors. I like the fact that the fund invests in shares it believes represent growth at a reasonable price. This should make the fund appropriate for investors looking for lower risk growth options.

More reading

• 2 ETFs to buy next week
• I plan to invest heavily in ASX shares next week
• What do you do when your ASX 200 shares are falling?
• 2 fantastic international ETFs that ASX investors can buy today
• Douugh and Afterpay were among the most traded shares on the ASX last week

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 BETANASDAQ ETF UNITS. The Motley Fool Australia has recommended BETANASDAQ ETF UNITS. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The post I would buy the BetaShares NASDAQ 100 ETF (ASX:NDQ) and these ETFs this month appeared first on Motley Fool Australia.

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If you’re looking for small cap ASX shares to add to your watchlist, then I think the two listed below could be worth considering.

I think they could be among the most exciting shares at the small end of the market right now. Here’s why they should be on your watchlists:

Aerometrex Ltd (ASX: AMX)

The first ASX small cap share to add to your watchlist is Aerometrex. It is a growing aerial mapping business specialising in aerial photography, LiDAR, and aerial imagery subscription services. It is arguably best-known for its MetroMap offering, which allows users to access high quality 2D imagery and 3D reality mesh models. This provides an easy-to-consume product for varied applications across a diverse range of industries. 

In addition to this, the company has been developing new products and recently announced a new bush fire prevention product. This new technology can determine the exact fuel load densities in any bushfire prone region in Australia. Management believes the breakthrough could allow users to adopt a far more science-based and pre-emptive fuel load strike position ahead of this year’s bushfire season. Given the importance of bushfire prevention, this development could give its sales a boost.

Audinate Group Limited (ASX: AD8)

Another small cap to look at is Audinate. It is a digital audio-visual networking technologies provider best known for its industry-leading Dante audio over IP networking solution. This product is used widely across a number of industries and has a clear lead over the competition.

In fact, management notes that the number of Dante enabled products manufactured by its customers is materially more than the nearest competitor. At the end of FY 2020, there were 2,804 Dante-enabled products on the market, which is eight times greater than rival Cobranet. I believe this bodes well for its growth over the coming years, once the pandemic passes.

More reading

• Are these small cap ASX shares the next Kogan (ASX:KGN) and Nearmap (ASX:NEA)?
• 3 quality ASX growth shares to buy in November
• Why Aerometrex, Healius, Megaport, & Temple & Webster shares are pushing higher
• Aerometrex (ASX:AMX) share price on watch after announcing new bushfire product
• Are these shares the next Afterpay (ASX:APT) and Appen (ASX:APX)?

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 AUDINATEGL FPO. The Motley Fool Australia has recommended AUDINATEGL FPO. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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It’s my belief that exchange-traded funds (ETFs) can be a great option for beginner investors. Most ETFs don’t offer the same risk levels that investing in an individual share does. An ETF can’t go bankrupt for instance. And since ETFs usually hold a broad basket of individual shares within them, the risks of a single company tanking your entire investment are also very low. As such, I would happily recommend an ETF to a beginner ASX investor as part of a diversified, balanced portfolio. Here are 2 that I think are worth a look today:

2 ASX ETFs for a beginner investor’s portfolio

iShares Global 100 ETF (ASX: IOO)

This ETF has a very simple mandate: holding 100 of the largest companies in the world that are listed in advanced economies. Most (72.7%) of the companies in this ETF are US-listed, but Switzerland, the United Kingdom, France, Germany, and Japan also have a presence. Some of the companies with the largest presence in IOO include Apple Inc, Amazon.com Inc, Johnson & Johnson, and Nestle SA.

This ETF’s very nature makes it a remarkably stable investment, and thus a great one for a beginner investor in my view. All of the companies in this ETF got to where they are for a reason, and many (such as Apple and Amazon) have thrived in 2020 under the dire circumstances of the pandemic. Thus, I just don’t think you can go wrong with a long-term investment in this one as part of a balanced share portfolio.

Vanguard US Total Market Shares Index ETF (ASX: VTS)

This ETF from Vanguard is a little less diverse than iShares Global 100. Rather than holding a basket of companies from around the world, VTS instead simply holds every share listed on the US markets (all 3,566 of them). The US has always been a great market to invest in – it is the country that produced Amazon, Apple, Netflix Inc, Berkshire Hathaway Inc, and Tesla Inc after all. You’ll of course find all those companies in the fund, as well as Microsoft Corporation, Facebook Inc, Visa Inc, and almost every other American company you can think of.

VTS has returned an average of 16.95% per annum over the past decade, and charges a management fee of just 0.03% per annum (or $3 for every $10,000 invested). As such, I think this is another ASX ETF which would work well for a beginner portfolio today. As with IOO, I think one can confidently buy VTS and throw it in the bottom drawer, content that it will continue to build wealth on your behalf.

Foolish takeaway

Both of these ETFs offer access to top, global companies outside the ASX. Because of this, I think using either ETF as part of a balanced and diversified portfolio of shares is a great move for a beginner investor today.

More reading

• Which ASX ETFs offer the most diversification?
• Is the Vanguard US Total Market Shares Index ETF (ASX:VTS) a great long-term investment?

John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, 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 Facebook, Johnson & Johnson, Tesla, and Visa. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and recommends Amazon, Apple, Berkshire Hathaway (B shares), Facebook, Microsoft, Netflix, Tesla, and Visa. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. recommends Johnson & Johnson and recommends the following options: long January 2021 $200 calls on Berkshire Hathaway (B shares), short January 2021 $200 puts on Berkshire Hathaway (B shares), long January 2021 $85 calls on Microsoft, short January 2021 $115 calls on Microsoft, short January 2022 $1940 calls on Amazon, long January 2022 $1920 calls on Amazon, and short December 2020 $210 calls on Berkshire Hathaway (B shares). The Motley Fool Australia has recommended Amazon, Apple, Berkshire Hathaway (B shares), Facebook, and Netflix. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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The Aussie real estate investment trusts (REITS), or real estate developers, were among the best-performing large caps and mid cap ASX shares today.

For example, out of the top 10 large caps, the share prices of Lendlease Group (ASX: LLC), Vicinity Centres (ASX: VCX), and Scentre Group (ASX: SCG) all increased by 2% or more. In the mid caps, Cromwell Property Group (ASX: CMW), and Abacus Property Group (ASX: ABP) sit on the leaders table. 

What drove the ASX REITs performance today?

One strong driver is the housing figures released today by CoreLogic.

CoreLogic’s most recent data shows that house prices nationally rose by 0.4%, with the exception of Victoria. Small markets like Darwin and Adelaide saw increases of 1.2%, with Canberra and Hobart recording rises of 1%. Perth and Brisbane recorded modest changes, up 0.6% and 0.5% respectively, while Sydney’s housing prices edged up 0.1%. 

CoreLogic pointed to low stock levels and strong demand as drivers behind the October rises. As quoted in the Australian Financial Review (AFR), CoreLogic head of research Tim Lawless went on to say; 

I think partly we can attribute that to the fact they generally have had better management of the virus itself, so we haven’t seen further lockdowns. But also they have better affordability and seem to be quite attractive to first-home buyers so there are some outside factors beyond the virus being better contained.

Other events 

DEXUS Property Group (ASX: DXS) today announced it has sold a North Sydney office tower above its book value. Moreover, it was recently reported that Amazon.com, Inc. (NASDAQ: AMZN) would be opening one of its fulfillment centres on a Dexus logistics park. It is estimated that Dexus has generated around $2 billion from planned exits and unsolicited offers recently. In a conversation with the AFR, Dexus chief investment officer Ross Du Vernet said:

We’re selling assets at book value and we’re buying back our stock at more than a 20 per cent discount to NTA [net tangible assets]. That is a very straightforward and value-enhancing trade for us.

The Dexus share price rose by 2.26% today.

Additionally, GPT Group (ASX: GPT) announced today it is planning to sell its 25% stake in 1 Farrer Place, the Sydney CBD landmark. At 30 June, its stake was valued at $584.6 million. The GPT Group has claimed two drivers behind the decision. First, the company prefers to hold or manage office towers it owns 50% or more of. Second, it intends to use the funds to grow its already increasing logistics pipeline.

The GPT share price finished the day up 2.98%.

More reading

• Why Abacus, Amaysim, CSR, & Telix shares stormed higher today
• Why the Abacus (ASX:ABP) share price is on the run today
• Elections, pandemics and rate cuts. Where to next for ASX share prices?
• ASX property shares buoyed by latest market data
• The Mosaic (ASX:MOZ) share price comes alive, up 5%

John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Daryl Mather has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and recommends Amazon and recommends the following options: short January 2022 $1940 calls on Amazon and long January 2022 $1920 calls on Amazon. The Motley Fool Australia has recommended Amazon. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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As we would probably all be aware of by now, the 2020 US presidential election is just around the corner. President Donald Trump is running for re-election against his Democratic challenger, former vice president Joe Biden. We can expect to see results to start coming in on Wednesday afternoon (our time).

Regardless of your personal feelings about the election and the candidates themselves, I think it’s a good time to evaluate which outcomes would be benevolent, and malevolent, for our ASX share market.

Elections matter to the sharemarket. Often, presidential candidates and the parties they are running ahead of, have vastly differing visions for how they want to shape and structure the US economy. And how the US economy is structured has a direct relationship with the US stock market, and by extension, or own S&P/ASX 200 Index (ASX: XJO).

Election season

So which outcome would be best for ASX shares? Well, let’s just say that the worst outcome would be an uncertain or contested result. Markets hate uncertainty at the best of times and having the world’s largest economy and market with a leadership vacuum for a month or longer would be a terrible outcome for global markets in my view.

But getting that scenario out of the way, let’s look at the options.

Reporting in the Australian Financial Review (AFR) today suggests that the best outcome for markets would be a Democratic ‘clean sweep’. This would involve Joe Biden winning the Presidency, as well as the Democratic Party winning a majority in both Houses of Congress (America’s parliament). Whilst the presidential election is going to be the most-watched election this week, remember at the same time, elections for the full US House of Representatives, as well as a third of the US Senate, are also taking place.

Some possible scenarios to consider

The AFR notes that if the Democrats sweep all 3 elections (sometimes referred to as a ‘blue wave’), the prospects of passing larger additional stimulus bills would increase dramatically. Larger stimulus means more money in the economy, which obviously is great news for US companies and the global economy (and markets), at least in the short-term.

However, if Biden or Trump wins the presidency, but the opposing side wins one or both houses of Congress, it could result in much smaller stimulus measures, or even gridlock.

The AFR quotes New York-based TPW Investment Management chief investment officer Jay Pelosky as stating the following on potential outcomes:

A Blue Wave would lead to stimulus akin to the already approved House bill for roughly $US2.2 trillion ($3.1 trillion) and would represent the start of what I expect could be a surprisingly active and progressive Biden administration.

A Trump win and Republican Senate would suggest a smaller stimulus sized around the White House $US1.5 trillion proposal.

A Biden win and a Republican Senate would result in gridlock, be extremely problematic for the US place in the world and near-term lead to a small stimulus – think Senate leader Mitch McConnell’s $US500 billion program.

Foolish takeaway

So at this point, a ‘blue wave’ Democratic sweep looks to be the most market-friendly outcome, for both the US and Australia’s ASX. According to the AFR, current polling is suggesting this outcome is a definite possibility (around a 75% chance) as well, but not a done deal. I guess we shall have to wait until Wednesday to really find out how the markets take the result!

More reading

• Westpac (ASX:WBC) reports FY20 result, ASX 200 up 0.4% today
• Why the CSR (ASX:CSR) share price is climbing today
• Top brokers just upgraded the ResMed (ASX:RMD) share price and this other ASX stock
• 3 ASX 200 shares that received broker upgrades last week
• Takeovers will continue to rock ASX shares

Motley Fool contributor Sebastian Bowen has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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The SEEK Limited (ASX: SEK) share price fell heavily in morning trade, following the response to a short seller attack late last week.

At one point, shares in the online employment company fell to as low as $19.78, reflecting an 8% decline. However, the SEEK share price has since recovered to finish the day marginally down at $21.53, down 0.8%.

What happened?

Last week, Blue Orca Capital took aim at Seek, stating that its Chinese business, Zhaopin was operating fraudulently.

The activist investment firm reported that SEEK’s subsidiary was being inundated with fake positing from deregistered, in-liquidation and abnormal companies. In addition, it was said that Zhaopin was carrying dangerous levels of debt, and has repeatability tapped capital markets to fund acquisitions.

Blue Orca backed its statements, saying it had investigated the claims. The firm said:

Companies we called about their job postings on the website even stated directly that the posts were fraudulent. Our due diligence also uncovered a whistle-blower claim by a Chinese college student alleging that Zhaopin pays people to submit fake resumes. We think Zhaopin’s platform is rotten, which is devastating for Seek’s prospects.

Blue Orca said that SEEK’s shares were grossly misplaced and rated them at $7.20 a piece.

SEEK responds

Earlier today, SEEK responded to the report, strongly refuting the statements and allegations made in relation to its Zhaopin business. SEEK believed that the goal of the report was to use speculative judgments to generate negative publicity, which is consistent with short-seller firms.

The online employment giant advised that the report contained many inaccuracies and the claims made were very serious and unsubstantiated. The company reaffirmed that it followed disclosure obligations and was confident in its long-term outlook.

SEEK said that Zhaopin had been profitable for more than 10 years, and continued to generate strong operating cash flow. The Chinese business had a net cash position of $222 million at the end of June.

Furthermore, SEEK confessed that fake advertisements and candidate CV’s was common in all online employment markets globally. It said it was a global leader in tackling this issue, and had strict processes to verify onboard customers and candidates.

The company acknowledges that while the Chinese market is highly competitive, Zhaopin leads in many, but not all key metrics.

SEEK co-founder and CEO Andrew Bassat commented on the article. He said:

We accept that market participants have different opinions, however this report is littered with inaccuracies. We are well positioned for future growth and remain confident in SEEK’s long-term outlook.

The company will provide a trading update at its annual general meeting on 19 November.

SEEK share price recovery

The SEEK share price has not only recovered today, but has neared its all-time high of $24.09 achieved in January. It seems though even a negative press release cannot dampen the online employment meteoric share price rise.

It’s evident that investors have disregarded the bad news from Blue Orca and see value in the $7.5 billion company. SEEK continues to recover from its 52-week low of $11.23 reached in March, representing a gain of 89%.

More reading

• Westpac (ASX:WBC) reports FY20 result, ASX 200 up 0.4% today
• Why 5G Networks, Cedar Woods, SEEK, & Tyro shares tumbled lower today
• SEEK (ASX:SEK) share price drops 5% after responding to Blue Orca short seller attack
• 5 things to watch on the ASX 200 on Monday
• 5 things to watch on the ASX 200 next week

Motley Fool contributor Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool Australia has recommended SEEK Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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If you’re looking to add some growth shares to your portfolio in November, then you might want to take a look at the ones listed below.

I believe they are among the best on the market and destined to deliver strong earnings growth over the 2020s.

Here’s why I rate them highly:

a2 Milk Company Ltd (ASX: A2M)

A2 Milk Company is a growing dairy company best known for its a2 Platinum infant formula range. It has been a big seller in China due to its premium brand and its use of milk from cows that have been specially selected to naturally produce milk with only the A2 beta-casein protein type. This protein is believed to be easier to digest than milk with both A1 and A2 proteins.

Although its sales in China have ballooned over the last few years, it is worth noting that its market share in the country is still very modest. I believe it has the potential to win a greater market share over the 2020s. Especially given its expanding distribution footprint through mother and baby stores and its strong presence on Chinese ecommerce platform.

Combined with its growing fresh milk footprint and potential acquisitions, I believe a2 Milk Company can grow its earnings at an above average rate over the next decade. Though, it is worth noting that FY 2021 is likely to be subdued due to COVID impacts.

Pushpay Holdings Group Ltd (ASX: PPH)

A second ASX growth share to buy is Pushpay. It is a donor management and community engagement platform provider for the faith sector. Its platform makes donating a seamless experience for both the giver and the receiver. Unsurprisingly, given the shift to a cashless society, this has been well-received by churches in the United States and led to a surge in customer numbers over the last few years.

This has underpinned very strong sales and earnings growth and shows no signs of slowing any time soon. In FY 2021, Pushpay is expecting to more than double its operating earnings once again. After which, it has its eyes on winning a 50% share of the medium to large church market in the future. Management estimates this to be a US$1 billion opportunity, which is almost 7 times greater than the revenue it generated in FY 2020.

Pushpay is due to hand in its interim report later this week, so investors may want to hold out for that release before investing. Though, I’m confident the company will smash expectations during the first half.

More reading

• 4 outstanding ASX 200 shares to buy with $4,000
• I plan to invest heavily in ASX shares next week
• 3 great ASX growth shares to buy in November
• 3 explosive ASX growth shares to buy with $3,000
• Why these ASX mid cap tech shares could smash the market in the 2020s

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 PUSHPAY FPO NZX. The Motley Fool Australia owns shares of and has recommended A2 Milk. The Motley Fool Australia has recommended PUSHPAY FPO NZX. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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The S&P/ASX 200 Index (ASX: XJO) started the week in fine form and charged higher on Monday. The benchmark index rose 0.4% to end at 5,951.3 points.

Four shares that climbed more than most today are listed below. Here’s why they stormed higher:

Abacus Property Group (ASX: ABP)

The Abacus Property share price rose 3% to $2.85. This follows the release of an announcement by the property company this morning. That announcement reveals that Abacus has signed an unconditional agreement to acquire the remaining 75% interest in self-storage company, Storage King.

Amaysim Australia Ltd (ASX: AYS)

The Amaysim share price jumped 11% to 74.5 cents after announcing the sale of its mobile business to Optus. According to the release, the two parties have signed an agreement for a cash consideration of $250 million. This follows the recent sale of its Click Energy business for $115 million. The company intends to return the funds to shareholders. At this time, it estimates that approximately $207.2 million to $225.7 million will be available for distribution to shareholders via a $0.67 to $0.73 per share dividend.

CSR Limited (ASX: CSR)

The CSR share price stormed 5.5% higher to $4.66 following the release of its half year results. The building products company reported a 6% decline in revenue to $1.07 billion. Management advised that this reflected a slowdown in residential construction and lower aluminium prices over the first six months. It appears as though the market was expecting much worse from CSR.

Telix Pharmaceuticals Ltd (ASX: TLX)

The Telix share price rocketed 30% higher to $2.16. Investors were buying the pharmaceuticals company’s shares after it announced a strategic commercial partnership with China Grand Pharmaceutical and Healthcare Holdings. The agreement is for its portfolio of Molecularly-Targeted Radiation products. It includes US$25 million up-front non-refundable prepayment to Telix and up to US$225 million in regulatory and commercial milestone payments.

More reading

• Telix (ASX:TLX) share price jumps 30% to an all-time high. Here’s why.
• Why the Boral (ASX:BLD) share price is up 6% today
• Westpac (ASX:WBC) reports FY20 result, ASX 200 up 0.4% today
• Why the Abacus (ASX:ABP) share price is on the run today
• Why the CSR (ASX:CSR) share price is climbing today

Motley Fool contributor James Mickleboro owns shares of TELIXPHARM DEF SET. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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The Telix Pharmaceuticals Ltd (ASX: TLX) share price has started the week with a bang, rocketing by more than 30% today in welcome news for shareholders.

Telix released a positive announcement during mid-afternoon trade, sending its shares to a new record. Shares in the biopharma company later pulled back just slightly to close the day up 28.96% at $2.16. 

Let’s take a look and see why the market responded so positively to Telix today.  

Landmark deal

According to the release, Telix advised it has entered a strategic commercial partnership with China Grand Pharmaceutical and Healthcare Holdings (CGP). The milestone agreement will see China Grand Pharmaceutical have access to Telix’s portfolio of molecularly-targeted radiation products (MTR).

China Grand has been chosen as Telix’s exclusive partner for the Greater China market. The deal includes the development and commercialisation rights to Telix’s prostate, renal and brain cancer imaging and therapeutics MTR products.

The deal in detail

Under the agreement, China Grand will provide an up-front payment of US$25 million to Telix. The credit does not consist of any future regulatory and commercial milestone payments.

Up to US$225 million is available in payments relating to key targets being met. They include up to US$69 million in attaining marketing authorisation from the National Medical Product Administration in China. Furthermore, up to US$156 million will be paid to Telix if net sales performance across the region is met during the term of the agreement.

China Grand Pharmaceutical will invest US$65 million in clinical costs to help develop Telix’s prostate and renal cancer products in China.

Royalties on therapeutic product sales will paid in addition to the milestone payments.

The initial term of the deal is valid for 10 years from the commencement date of each product being granted marketing authorisation.

Strategic equity investment

China Grand will make a strategic equity investment of US$25 million in the private placement of 20,947,181 fully paid ordinary Telix shares. The shares will be issued at a price of $1.69 and locked to a holding period of no less than 12 months.

Management commentary

Telix CEO Dr Chris Behrenbruch commented on the partnership:

Telix’s mission is to be a leading global oncology company and China is an important future market for our products. We are pleased to be working with CGP to deliver our diagnostic imaging and therapeutic products to cancer patients in China.

We believe that CGP possesses the technical experience and execution infrastructure to be an ideal clinical and commercial partner for Telix in China.

China Grand executive deputy officer Mr Frank Zhou added:

China Grand Pharma has a strong commitment to oncology, including radioactive products, in China and around the globe.

We firmly believe in the potential of Telix’s product portfolio to have a significant clinical impact in China. It is an honour for us to have the right to bring Telix’s unique product range to our doctors and patients with major unmet medical needs. At the same time, our close clinical involvement will help bring strength to Telix’s product development and reach. We are very excited about this long-term partnership.

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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. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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