Tag: Fool

If you were invested in ASX 200 shares vs. property in FY24 then you probably did pretty well.

The S&P/ASX 200 Index (ASX: XJO) rose by 7.83% in FY24, and if we add dividends on top, the total return was a median 12.1%.

Meanwhile, the national median property price rose by 8%. If we add rental income to that capital growth, the total return for investors was a median 12.2%, according to CoreLogic data.

But these are just median figures, right?

As all investors know, returns can differ markedly depending on which individual ASX stocks you are invested in and the location of your real estate investments.

So, shall we get specific?

Best performing city and regional property markets of FY24

Home price growth across the city and regional property markets of Australia varied in FY24.

Home values in most markets went up. The Perth property market was an absolute screamer, with 23.6% growth over the 12 months. Two other mid-tier capital cities — Brisbane and Adelaide — also stood out.

But we have a couple of buyers’ markets in play right now, too. They are Melbourne and Hobart, along with their regional counterparts.

Let’s review the data from CoreLogic.

In short, investors holding properties in Perth and regional Western Australia did best in FY24.

Property market	Capital growth in FY24 (all homes)
Perth	23.6%
Regional Western Australia	16.6%
Brisbane	15.8%
Adelaide	15.4%
Regional Queensland	12.2%
Regional South Australia	11.3%
National	8%
Sydney	6.3%
Regional New South Wales	4.1%
Darwin	2.4%
Canberra	2.2%
Melbourne	1.3%
Regional Tasmania	0.7%
Hobart	(0.1%)
Regional Victoria	(0.5%)

Want to get even more specific?

Suburb-level data for price growth in FY24 is not publicly available from CoreLogic yet. However, we can report the best price growth among SA3 districts across Australia’s eight capital cities.

An SA3 is a location metric used by the Australian Bureau of Statistics (ABS). The ABS defines SA3s as “often the functional areas of regional towns and cities with a population in excess of 20,000 or clusters of related suburbs …”.

The top 10 SA3 areas for price growth nationally were all in Greater Perth and experienced between 26% and 33.19% capital growth.

In order, they were Kwinana, Armadale, Gosnells, Rockingham, Mandurah, Canning, Cockburn, Swan, Wanneroo and Serpentine-Jarrahdale.

Here are the No. 1 SA3s for home price growth in each of the greater capital city areas.

Best-performing SA3 areas for home price growth in FY24

Capital city	No. 1 SA3 district	Capital growth (all homes)
Sydney	Mount Druitt	13.96%
Melbourne	Moreland-North	4.71%
Brisbane	Springwood-Kingston	25.55%
Perth	Kwinana	33.19%
Adelaide	Playford	19.94%
Canberra	Weston Creek	5.24%
Hobart	Sorell-Dodges Ferry	2.78%
Darwin	Litchfield	3.21%

Top performing ASX 200 shares of FY24

Now we can compare the capital growth of the top 10 ASX 200 shares vs. property in FY24.

ASX 200 shares	Capital growth in FY24
Pro Medicus Limited (ASX: PME)	118.3%
Life360 Inc (ASX: 360)	115.4%
Red 5 Limited (ASX: RED)	89.5%
West African Resources Ltd (ASX: WAF)	86.1%
Altium Ltd (ASX: ALU)	84.3%
Hub24 Ltd (ASX: HUB)	82.9%
Deep Yellow Limited (ASX: DYL)	77.5%
SiteMinder Ltd (ASX: SDR)	74.3%
Neuren Pharmaceuticals Ltd (ASX: NEU)	73.6%
Goodman Group (ASX: GMG)	73.1%

What’s the outlook for home values?

The CBA economics team has just revised its forecast for home price growth in the calendar year of 2024.

Senior economist Belinda Allen said the forecast had increased from 5% growth to 7% growth nationwide. The upward revision is primarily due to strong demand and a low supply of homes for sale.

Looking ahead to the calendar year 2025, CBA expects another 5% lift nationwide, with the mid-tier capital cities of Perth, Brisbane and Adelaide continuing to outperform Sydney and Melbourne.

The post Shares vs. property: Which stocks and suburbs delivered the best growth in FY24? appeared first on The Motley Fool Australia.

More reading

• 5 things to watch on the ASX 200 on Wednesday
• Here are the top 10 ASX 200 shares today
• 5 ASX growth shares that could rise 10% to 40%
• 5 things to watch on the ASX 200 on Tuesday
• Here’s the 3 best ASX artificial intelligence (AI) shares of FY24

Motley Fool contributor Bronwyn Allen has positions in Goodman Group. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Altium, Goodman Group, Hub24, Life360, Pro Medicus, and SiteMinder. The Motley Fool Australia has positions in and has recommended SiteMinder. The Motley Fool Australia has recommended Goodman Group, Hub24, and Pro Medicus. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

On Tuesday, the S&P/ASX 200 Index (ASX: XJO) was back on form and charged higher. The benchmark index rose 0.85% to 7,829.7 points.

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

ASX 200 expected to fall

It looks set to be a tough day for the Australian share market on Wednesday despite another positive session in the United States. According to the latest SPI futures, the ASX 200 is expected to open the day 46 points or 0.6% lower. On Wall Street, the Dow Jones was down 0.1%, but the S&P 500 rose 0.1% and the Nasdaq climbed 0.15%. The latter two closed at record highs after the US Fed suggested that holding rates high for too long could impact economic growth.

Oil prices fall

ASX 200 energy shares such as Beach Energy Ltd (ASX: BPT) and Woodside Energy Group Ltd (ASX: WDS) could have a poor session after oil prices dropped again overnight. According to Bloomberg, the WTI crude oil price is down 0.85% to US$81.62 a barrel and the Brent crude oil price is down 1.1% to US$84.84 a barrel. Easing concerns about Tropical Storm Beryl weighed on prices.

Buy Telstra shares

The Telstra Group Ltd (ASX: TLS) share price could be good value according to analysts at Goldman Sachs. In response to news that the telco giant is lifting its mobile prices by $2 to $4, the broker has reiterated its buy rating with an improved price target of $4.30. It commented: “We estimate the postpaid plan changes to drive a blended A$2.50 ARPU [average revenue per user] increase for Telstra. Adjusting for GST, consumer mix (i.e. 2/3 of base) and c.9 month impact, we expect this to contribute $1.14 of ARPU growth, before any potential spin-down.”

Gold price rises

ASX 200 gold shares Evolution Mining Ltd (ASX: EVN) and Northern Star Resources Ltd (ASX: NST) will be on watch following a decent night for the gold price. According to CNBC, the spot gold price is up 0.35% to US$2,339.5 an ounce. Optimism over interest rate cuts in the United States boosted the precious metal.

Insignia shares on watch

Insignia Financial Ltd (ASX: IFL) shares will be on watch today after the financial services company denied media speculation that it was a private equity target. The company, formerly known as IOOF, saw its shares close almost 14% higher on Tuesday, prompting a price query by the ASX. In response to the query, Insignia commented: “Recent press article published Tuesday 9 July 2024 at 12:45pm in AFR Street Talk “Insignia calls in Citi as PE circles: Geoff Lloyd around the hoop” written by Sarah Thompson, Kanika Sood and Emma Rapaport. Citi has not been engaged to field any offers and the company is not aware of any offer.”

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

More reading

• Here are the top 10 ASX 200 shares today
• Analysts love Woodside and these ASX dividend stocks
• How much cash do you need to quit work and live off ASX dividend income?
• Goldman Sachs says these ASX gold stocks are buys
• Why DroneShield, GenusPlus, Monadelphous, and Telstra shares are roaring higher today

Motley Fool contributor James Mickleboro has positions in Woodside Energy Group. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Goldman Sachs Group. The Motley Fool Australia has positions in and has recommended Telstra Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Fortescue Ltd (ASX: FMG) shares have seen a fair amount of volatility in 2024 to date, down by nearly 26%, as shown on the chart below. However, with the much-reduced valuation, an expert spies an opportunity.

The short-term success of a commodity business is often linked to the price of the commodity. If the iron ore price falls, then it can significantly cut into that year’s profitability.

At the start of 2024, the iron ore price was above US$140 per tonne, but it has since dropped to around US$110 per tonne, according to Trading Economics.

Optimistic view on Fortescue shares

Writing on The Bull, Michael Gable from Fairmont Equities has called the ASX mining share a buy. He pointed out that the Fortescue share price has fallen from $27.30 on 22 May 2024 to around $21.80 now, a decline of around 20%.

Gable and his team suggest that this is an “attractive entry level”. The expert noted that the weaker iron ore price has led to the Fortescue share price fall. But, in past years, Fortescue “has often been oversold on weaker iron ore prices only to bounce back”.

The Fairmont Equities expert suggests that the Fortescue share price could “move higher from these oversold levels.”

What’s happening to the iron ore price?

According to Trading Economics, iron ore recently pulled back from a one-month high as data points to “rising iron ore inventories” at Chinese ports, which is signalling “weaker demand from steel mills for metal production.”

Markets are now focusing on the upcoming Third Plenum, which will be held later in July. Leading Chinese officials are expected to tackle plans to “comprehensively deepen reform and advance Chinese modernisation.”

Some analysts are now seeking further policy support for the Chinese property sector.

Trading Economics also noted that weak US economic data increased bets that the US Federal Reserve could start cutting interest rates as early as September. If US rates are reduced, then this could boost global economic growth and overall demand, supporting commodity prices.

It’s possible that the growing economies of other Asian countries could lead to increased demand for Australian iron ore beyond China. Indian steel demand is expected to keep rising, according to one of the largest steel mills in the world’s most populous country.

Fortescue share price snapshot

Despite all of the volatility, the Fortescue share price is actually up nearly 3% in the last 12 months.

The post It’s a buy! Expert says Fortescue shares are oversold appeared first on The Motley Fool Australia.

More reading

• Here’s what the iron ore price will be this time next year: Westpac
• These 5 ASX dividend shares had the highest yields in FY24
• Fortescue shares: Here are the must-know highlights from FY24
• Fortescue shares red-hot as court reveals company espionage
• What is the outlook for ASX 200 dividend shares in FY25?

Motley Fool contributor Tristan Harrison has positions in Fortescue. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The stock market has no shortage of ASX shares in which we can invest. Some will turn out to be lucrative winners, giving their investors life-changing gains.

Many will prove to be conservative investments, slowly building wealth for their owners over time. But there will also be those ASX shares that prove to be duds and are destined to cause nothing but pain to those investors who buy them.

Today, let’s discuss two ASX shares that I sadly think fall into the latter group.

In today’s stock market, I’d avoid these two ASX shares

Guzman y Gomez Ltd (ASX: GYG)

The Guzman y Gomez float last month generated some of the biggest buzz we’ve seen from an IPO on the Australian market in years. But I think investing in Guzman shares at their current pricing is a mistake. As such, this is one ASX share I’m giving a wide berth this July.

As a rule, I usually avoid ASX share IPOs at all costs. They are hyped-up events that usually produce wild swings in the company in question’s shares. Guzman’s IPO was no different, with investors seeing a huge surge in value, followed by a dramatic slump.

But even if Guzman hadn’t just IPOed, I wouldn’t buy the shares at today’s ASX pricing. The company has a stretched valuation by any metric. Its market capitalisation stands at $2.79 billion right now – more than double that of KFC operator Collins Foods Ltd (ASX: CKF).

Sure, Guzman has grand expansion plans, which probably explains why its shares look expensive based on its current metrics. But if these expansion plans don’t, well… go to plan, investors will probably be in line for a major haircut.

Given how competitive the global fast food space is, I think Guzman’s success is far from a done deal. As such, I am in agreeance with my Fool colleague James that this is one ASX share to stay well away from at current prices.

WAM Capital Ltd (ASX: WAM)

WAM Capital is an ASX share and listed investment company (LIC) that is popular amongst investors who look for large, fully franked dividends. Unfortunately, I think choosing this LIC for that purpose (or any other) would be a mistake today.

Yes, WAM Capital shares do trade on a juicy dividend yield of 10.2% right now. But if you consider that the WAM share price has lost a nasty 32% or so over the past five years, shareholders have barely come out ahead. There’s also this ASX share’s weighty management fee of 1% per annum to take into account.

Moreover, WAM Capital’s hefty dividend doesn’t look sustainable. The company’s latest update informed investors that it currently doesn’t have enough cash to cover its dividend at the current level for the next 12 months.

As such, this is another ASX share that I would avoid at all costs right now.

The post 2 ASX shares I’d give a wide berth to in today’s stock market appeared first on The Motley Fool Australia.

More reading

• 5 reasons I’d throw Guzman y Gomez shares in the bin like a bad burrito
• These 5 ASX dividend shares had the highest yields in FY24
• Top brokers name 3 ASX shares to buy next week
• Why I invested in Guzman Y Gomez (GYG) shares this week for the long-term
• GYG share price ends the week at $28. Is $62 in its future?

Motley Fool contributor Sebastian Bowen has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Collins Foods. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Australians have enjoyed the benefits of superannuation since the scheme was initiated in July 1992.

To ‘superannuate’ someone means to retire someone with a pension. According to Thinking Ahead Institute, Australian pension assets have grown from 108% of gross domestic product (GDP) in 2013 to 145% in 2023.

The firm estimates Australians held over $2.4 trillion in pension assets at the end of 2023, the world’s fifth largest holdings behind Canada, the UK, Japan and the US, respectively. Most of these are in equities, like those in the iShares Core S&P/ASX 200 ETF (ASX: IOZ).

That’s a lot of capital, and I’m sure by now you’re wondering what age Australians typically access their super.

Let’s examine the details surrounding superannuation access, various retirement intentions, and the financial aspects related to these.

Accessing superannuation: Preservation age

In the vast majority of people’s cases, the preservation age is the earliest you can access your superannuation. I emphasise ‘earliest’ because it’s not the most common age.

For those born after July 1964, the preservation age is 60 years old.

So, to be considered ‘retired’ at preservation age, you have to be at least 60 and have ceased employment (with no intention of returning to work more than 10 hours a week).

But what if you intend to work beyond 60?

Once Australians reach this age, they can generally start accessing their superannuation funds, even whilst still working.

But you cannot access the funds as a lump sum yet. Only as an income stream.

If you want to access super as a lump sum, the criteria known as a ‘condition of release’ is:

• Turning 65: Access to superannuation is available even if you haven’t retired.
• Retirement: Ceasing gainful employment and having no intention of returning to work.

So the key difference in how and when you access super depends on whether you want to start drawing it as income or as a lump sum, and what age (or if) you intend to officially retire.

Critically, in both instances, the super payments are tax-free.

No matter what though, once you hit 65 years old, you can access your superannuation.

Interestingly, according to a report by super fund MLC, the average retirement age for Australians varies but has been trending upwards. MLC notes the average age at which individuals retire is approximately 65.4 years.

This figure differs between genders and industries, with men typically retiring later than women.

Superannuation trends and statistics

According to MLC, the average superannuation balance for Australians aged 65 to 69 is $428,738, with a median balance of $207,540.

These amounts are usually sufficient to fund a ‘modest’ retirement lifestyle, it says.

What does a ‘modest’ lifestyle look like in retirement, you ask? MLC provides the following table from the Association of Superannuation Funds of Australia (ASFA):

Total per year	Comfortable lifestyle p.a.		Modest lifestyle p.a.
	Couple	Single	Couple	Single
	$72,148.19	$51,278.30	$46,994.28	$32,665.66

These figures will likely change over time as inflation plays its course.

Foolish takeout

Accessing superannuation can begin at the preservation age of 60 as an income stream. However, many Australians often wait until the retirement age of around 65 years old to access their super as a lump sum.

Understanding the conditions of release and planning your finances can ensure a comfortable retirement. Always seek professional help when needed.

The post What’s the average age Australians access their superannuation? appeared first on The Motley Fool Australia.

More reading

• Here are the top 10 ASX 200 shares today
• Analysts love Woodside and these ASX dividend stocks
• CBA shares hit new record amid higher revised predictions for home price growth
• Here’s what the iron ore price will be this time next year: Westpac
• Why did ASIC take a look when Qantas shares fell last year?

Motley Fool contributor Zach Bristow has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The post Here are the top 10 ASX 200 shares today appeared first on The Motley Fool Australia.

More reading

• How much cash do you need to quit work and live off ASX dividend income?
• Why DroneShield, GenusPlus, Monadelphous, and Telstra shares are roaring higher today
• Telstra share price lifts off alongside its mobile pricing plans
• 5 things to watch on the ASX 200 on Tuesday
• Here are the top 10 ASX 200 shares today

Motley Fool contributor Sebastian Bowen has positions in Telstra Group. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Domino’s Pizza Enterprises and Pinnacle Investment Management Group. The Motley Fool Australia has positions in and has recommended Pinnacle Investment Management Group and Telstra Group. The Motley Fool Australia has recommended Domino’s Pizza Enterprises. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

There are lots of ASX dividend stocks to choose from on the Australian share market, but which ones could be buys in July?

Three shares that were recently picked out as buys by analysts are listed below. Here’s what its analysts are saying about them:

HomeCo Daily Needs REIT (ASX: HDN)

HomeCo Daily Needs could be a top option for income investors. It is a property company with a focus on neighbourhood retail and large format retail assets (retail parks).

Morgans rates HomeCo Daily Needs highly. This is due to the resilience of its cashflows and exposure to accelerating click and collect trends. Together with its development pipeline, the broker feels the company is well-positioned for growth.

Morgans expects this to underpin dividends per share of 8 cents in FY 2024 and then 9 cents in FY 2025. Based on the current HomeCo Daily Needs share price of $1.20, this will mean dividend yields of 6.7% and 7.5%, respectively.

The broker currently has an add rating and $1.37 price target on its shares.

NIB Holdings Limited (ASX: NHF)

Another ASX dividend stock that could be a buy is private health insurer NIB.

Goldman Sachs is positive on the company. It highlights that NIB “offers defensive exposure to the private health insurance sector which is experiencing favourable operating trends.”

The broker expects this to support the payment of fully franked dividends per share of 31 cents in FY 2024 and 30 cents in FY 2025. Based on the current NIB share price of $6.88, this would mean 4.5% and 4.3% yields, respectively.

Goldman currently has a buy rating and $8.10 price target on NIB’s shares.

Woodside Energy Group Ltd (ASX: WDS)

Finally, Morgans is also positive on Woodside and thinks it could be an ASX dividend stock to buy. Woodside is of course one of the world’s largest energy companies with a portfolio of high-quality operations and projects.

The broker thinks that recent share price weakness has made now “a good time to add to positions.” Especially given that it believes Woodside “will still generate substantial high-quality earnings for years to come.”

Morgans expects this to underpin fully franked dividends of $1.25 per share in FY 2024 and then $1.57 per share in FY 2025. Based on the current Woodside share price of $28.59, this equates to 4.4% and 5.5% dividend yields, respectively, for investors.

The broker has an add rating and $36.00 price target on its shares.

The post Analysts love Woodside and these ASX dividend stocks appeared first on The Motley Fool Australia.

More reading

• 4 reasons to buy Woodside shares today
• ASX 200 energy shares eyeing ACCC gas crunch warning
• What happened with the Woodside share price in FY 2024?
• 5 things to watch on the ASX 200 on Monday
• Here’s how the ASX 200 market sectors stacked up last week

Motley Fool contributor James Mickleboro has positions in Woodside Energy Group. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Goldman Sachs Group. The Motley Fool Australia has positions in and has recommended NIB Holdings. The Motley Fool Australia has recommended HomeCo Daily Needs REIT. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Commonwealth Bank of Australia (ASX: CBA) shares are trading 1.47% higher on Tuesday at $128.30.

CBA shares are outperforming the S&P/ASX 200 Index (ASX: XJO), which is up 0.82%.

Australia’s biggest home loan lender has released revised growth predictions for home prices.

Let’s check them out.

CBA shares going in the same direction as home values

In a note released last week, CBA increased its forecast growth for home values in the calendar year 2024.

CBA senior economist Belinda Allen said:

We have held a long-term view that national home prices would lift by 5% this calendar year.

In recent months we have highlighted upside risks to this forecast based on acute housing shortages, strong demand and below average listings on the market.

As a result of these factors and monthly home price rises remaining stronger than expected we revise our forecasts to expect a 7% lift this year.

As we recently reported, the national median home value, which reflects all types of property in a single data point, rose by 8% in FY24 (total returns of 12.2% with rental income), according to CoreLogic data.

But the strongest markets recorded far greater growth than the national median.

Perth home values screamed 23.6% higher in FY24. Brisbane values leapt 15.8% and Adelaide values weren’t far behind at 15.4%.

The key reason for these cities’ outperformance was tight supply and demand.

The number of homes for sale is significantly below the long-term averages for each city. Plus, demand is high given these markets offer much greater affordability than Sydney, Melbourne and Canberra.

What about interest rates?

Allen said higher interest rates — which mean higher mortgage repayments and limitations on credit availability for new buyers — along with cost-of-living pressures would normally slow the pace of home prices or even push them lower. But that’s not happening due to the tight supply and demand.

“… the leading indicators such as new lending, auction clearance rates and even sentiment continue to point towards gains in home prices,” she said.

The possibility of an increase in interest rates due to sticky inflation may limit the upside risk to home values and slow the pace of price growth, she added.

CBA predicts an interest rate cut in November, and Allen said this could provide a tailwind for home values. Her economics team sees further price gains ahead in 2025.

She said:

Our first look at home prices for 2025 sees further gains nationwide, although significant capital city divergences remain.

An expected easing cycle by the RBA and still acute supply shortages should see prices rise, but growing affordability challenges should limit the size of these gains.

We expect a lift of 5% over calendar year 2025 with the mid-tier capital cities again outperforming Sydney and Melbourne.

Property price predictions for 2024 and 2025

Here are CBA’s forecasts for home values growth in the calendar years of 2024 and 2025.

Capital city	Growth prediction 2024	Growth prediction 2025
Perth	22%	12%
Adelaide	14%	9%
Brisbane	13%	7%
Sydney	5%	4%
Melbourne	0%	4%

What’s next for CBA shares?

The outlook for CBA shares among brokers is varied.

Goldman Sachs is bearish.

Goldman describes CBA shares as “in uncharted valuation territory” based on the premium they usually trade for relative to their return on equity (ROE) forecast.

The broker has a sell rating on CBA and a 12-month share price target of $82.61.

This implies a 35% fall from today’s CBA share price.

UBS also expects CBA shares to fall but not by as much as Goldman.

The broker has a 12-month share price target of $105, implying an 18% downside risk from here.

Braden Gardiner from Tradethestructure recently told The Bull that traders in CBA shares “may want to consider locking in some gains if the share price falls below $116”.

The post CBA shares up amid higher revised predictions for home price growth appeared first on The Motley Fool Australia.

More reading

• How much cash do you need to quit work and live off ASX dividend income?
• Are ASX 200 bank shares too expensive to buy right now?
• Are Macquarie or CBA shares a better buy?
• Forget CBA and buy these ASX dividend stocks
• ASX 200 bank shares ‘don’t appear overly expensive’ compared to global peers: UBS

Motley Fool contributor Bronwyn Allen has positions in Commonwealth Bank Of Australia. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Goldman Sachs Group. 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 Scott Phillips.

The iron ore price fell 1.55% in overnight trading to close the session at US$111.31 per tonne.

This is weighing on iron ore shares today, with many underperforming the S&P/ASX 200 Index (ASX: XJO).

The ASX 200 is up 0.78% at the time of writing.

The BHP Group Ltd (ASX: BHP) share price is up 0.53% to $43.71.

Mineral Resources Ltd (ASX: MIN) shares are only just in the green, up 0.053% to $56.36 apiece.

The Fortescue Ltd (ASX: FMG) share price is down 0.23% to $21.77.

Champion Iron Ltd (ASX: CIA) shares are 0.31% lower at $6.45.

The Rio Tinto Ltd (ASX: RIO) share price is an outlier, up 0.87% at $120.94.

What’s happening with the iron ore price this week?

Analysts at Trading Economics say a four-day rally last week inspired some profit-taking.

Secondly, investors are continuing to assess the outlook for demand in China.

China is the world’s biggest consumer of iron ore.

The country imports 76% of the iron ore dug out of the ground worldwide every year. Therefore, the rate of demand there has a very significant influence on the iron ore price.

Australia is one of the world’s biggest producers of iron ore. China’s custom was worth $115.6 billion in export earnings to us in 2023, according to the Department of Resources.

That’s why we tend to see a pullback in ASX iron ore shares when the commodity price falls or we hear negative news out of China.

According to Trading Economics analysis of last night’s fall in the iron ore price:

Data also pointed to rising iron ore inventories on Chinese ports, signaling weaker demand from steel mills for metal production. Markets now look ahead to the Third Plenum later in July where top Chinese officials are expected to tackle plans on “comprehensively deepening reform and advancing Chinese modernization,” with investors looking for further policy support for the property sector.

Will the iron ore price rise or fall from here?

Westpac Banking Corp (ASX: WBC) has released its latest forecasts for various commodities.

Westpac Senior Economist Justin Smirk expects the 62% spot iron ore price to fall from here.

He tips the iron ore price will dip to an average of US$102 per tonne in the September quarter and US$90 per tonne in the December quarter.

He sees a further decline to between US$85 per tonne and US$87 per tonne from the March 2025 quarter to the March 2026 quarter.

This time next year, Smirk thinks the iron ore price will be averaging US$85 per tonne.

The Australian Government also forecasts the commodity’s value to fall. Its latest official forecast points to a fall in the 62% spot price to a nominal average of US$96 per tonne in 2024.

It predicts a further decline to a nominal average of US$84 per tonne in 2025 and US$77 per tonne in 2026.

This will contribute to reduced iron ore export earnings from $138 billion in 2023–24 to $114 billion in 2024–25 and $102 billion in 2025–26.

What will this do to ASX mining share prices?

The iron ore price has a direct impact on the earnings of ASX 200 miners.

Miners are price takers, so their earnings are subject to global commodity values. Production volumes also have an impact, of course.

Usually, when the commodity price is rising or falling, ASX mining share prices follow suit.

The post Here’s what the iron ore price will be this time next year: Westpac appeared first on The Motley Fool Australia.

More reading

• These 5 ASX dividend shares had the highest yields in FY24
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Motley Fool contributor Bronwyn Allen has positions in BHP Group and Commonwealth Bank Of Australia. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Qantas Airways Ltd (ASX: QAN) shares encountered turbulence in FY24, “flying backwards” on the chart as my colleague Bernd put it.

At the time of writing, shares in the iconic flying kangaroo are swapping hands 0.082% higher at $6.11 apiece.

Reports have surfaced that The Australian Securities and Investments Commission (ASIC) recently raised questions about certain price movements in Qantas shares last year.

This came around the time Qantas was under investigation by the Australian Competition and Consumer Commission (ACCC), according to The Australian Financial Review.

Here’s a closer look.

ASIC queries Qantas’ knowledge

As a reminder, the ACCC began proceedings against Qantas in August 2023.

It alleged Qantas sold tickets for flights that had already been cancelled during the COVID-19 pandemic. This resulted in Qantas paying a $120 million settlement.

But from 24 July to 20 October last year, as news of the probe surfaced, Qantas shares plunged from highs of $6.69 to lows of $4.77, respectively.

ASIC reportedly wrote to its fellow corporate watchdog at the ACCC shortly after Qantas shares fell.

It was asking about the timeline of the ACCC’s investigation into the airline.

It aimed to determine if Qantas directors or executives knew about the investigation before it happened or before the significant drop in the company’s share price tied to these events.

The regulator also inquired about the board-approved share sales of its former CEO, Alan Joyce.

Joyce reportedly sold $17 million of his Qantas shares in June last year – equivalent to more than 90% of his stake – shortly before the ACCC made its proceedings against the airline public.

What’s next for Qantas shares?

Despite ASIC’s requests for information, there is no indication it will follow up with an investigation, or that Joyce and the company’s board acted on insider information.

The news is also a media report and not a market-sensitive update, so it’s unsurprising that Qantas shares did not react. However, the same couldn’t be said for the last financial year.

In FY24, the Qantas share price dropped nearly 6%, closing at $5.85 on the last trading day of the financial year.

This decline occurred despite strong financial results for FY23, which saw a 118% year on year increase in revenue to $19.8 billion and a pre-tax profit of $2.5 billion.

Despite this, Qantas shares have rebounded in FY25 and are up 13% this year to date.

The airline’s February H1 FY24 results showed revenue of $11.1 billion and a solid underlying profit before tax of $1.3 billion.

It also authorised another $400 million share buyback.

Goldman Sachs rates Qantas as a buy, with a price target of $8.05. This indicates a potential upside of nearly 32% from the current price.

Meanwhile, consensus rates it a buy, according to CommSec.

The post Why did ASIC take a look when Qantas shares fell last year? appeared first on The Motley Fool Australia.

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• Qantas share price drops 3% amid Qatar rumours

Motley Fool contributor Zach Bristow has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Goldman Sachs Group. 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 Scott Phillips.