Tag: Motley Fool Australia

Are you an investor that wants safe income? I think there are some ASX dividend shares that can provide reliable income.

Nothing in the share market is guaranteed – it’s not like a term deposit. Share prices can be very volatile. The share market is made up of different buyers and sellers every day. It’s not surprising that share prices move around so much.

Dividend income from ASX shares is a bit different. The boards of companies have a lot of control over what dividend they declare each year. Dividends are much more likely to follow the longer-term direction of the business’ profit.

With that in mind, here are three ASX shares that could offer safe income:

Share 1: APA Group (ASX: APA)

APA is an infrastructure giant which owns a large amount of gas pipelines around Australia. It supplies around half of the country’s natural gas. APA also owns, or has stakes in, a number of energy generation or energy storage assets.

Gas demand has held up well for APA during this difficult period. Resilient demand has meant robust for APA’s cashflow. The business funds its distribution from the annual cashflow, so it was able to pay the expected FY20 annual distribution of 50 cents per unit.

At the current APA share price, that distribution amounts to a yield of 4.35%. I think that APA is a reliable ASX share for dividend income because it already has a solid track record. It has increased its distribution every year for the past decade and a half. It can keep growing as the annual cashflow keeps growing with more projects or investments coming online.

Share 2: Washington H. Soul Pattinson and Co. Ltd (ASX: SOL)

I think that Soul Patts is the gold standard for reliable dividend income.

The ASX share has grown its dividend every year since 2000. It has also paid a dividend every year since it listed in 1903. The dividend has kept coming through wars and recessions.

Soul Patts is an investment house with a diversified portfolio of assets like TPG Telecom Ltd (ASX: TPG), Brickworks Limited (ASX: BKW) and Clover Corporation Limited (ASX: CLV). It also operates unlisted businesses like swimming schools, resources and agriculture.

Each year the company receives investment income from its assets, Soul Patts pays its expenses from this income and then pays out the dividend with a substantial portion of the rest. In FY19 it retained around 20% of the net regular operating cashflow, allowing it to re-invest that money into other opportunities.

Soul Patts’ dividend can keep growing from this re-investing as well as growth from its existing holdings.

At the current Soul Patts share price it offers a grossed-up dividend yield of 4.2%.

Share 3: Rural Funds Group (ASX: RFF)

There are few ASX shares with the income potential of Rural Funds in my opinion. I think it offers a good combination of a solid starting yield as well as ongoing growth.

At the current Rural Funds share price it has a FY21 distribution yield of 5.3%. The farmland real estate investment trust (REIT) is aiming for distribution growth of 4% per annum.

REITs are known for having good yields, and Rural Funds has a smart investment strategy. It owns farms with long-term income growth potential such as cattle and almonds.

Its contracted rental income grows by either a fixed 2.5% increase per annum or it’s linked to CPI inflation, plus market reviews.

The REIT also is growing its rental income by investing in productivity improvements at farms. At the moment it’s focusing on investing at its cattle farms.

Foolish takeaway

Each of these ASX shares have grown their dividends to shareholders for multiple years in a row. I think that record could continue in FY21 and perhaps for the rest of the decade. Soul Patts is my favourite ASX share idea for reliable dividend income because it’s diversified and it can shift its portfolio over time.

More reading

• 3 quality ASX shares to buy in August
• Beat low interest rates with these ASX dividend shares
• Got $3,000 to invest? Try these 2 dirt-cheap ASX shares
• Cash rate on hold until after 2022? Buy these ASX dividend shares
• 2 ASX shares I plan to hold until I’m 100

Tristan Harrison owns shares of RURALFUNDS STAPLED and Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of Clover Limited. The Motley Fool Australia owns shares of and has recommended Brickworks, RURALFUNDS STAPLED, and Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia owns shares of APA Group. 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 dividend shares to your portfolio in August, then the two listed below could be great options.

I believe both are well-placed to continue growing their dividends over the coming years despite the tough economic environment. Here’s why I think they are among the best on offer right now:

BWP Trust (ASX: BWP)

The first ASX dividend share to consider buying is BWP. It is a real estate investment trust that invests in and manages commercial assets. These assets tend to be large format retail properties, which are predominantly leased to home improvement giant, Bunnings Warehouse. At the end of FY 2020, its weighted average lease expiry (WALE) stood at 4 years, with 98% of its portfolio leased.

And while this isn’t the longest WALE you’ll find on the ASX, I don’t see Bunnings moving to other properties in a hurry. Especially given how Bunnings is owned by Wesfarmers Ltd (ASX: WES), which also owns ~23.6% of BWP. All in all, I believe BWP is well-placed to grow its income and distribution at a modest and predictable rate over the next decade. Based on this and the current BWP share price, I estimate that it offers a forward 4.6% yield.

Dicker Data Ltd (ASX: DDR)

Another ASX dividend share to consider buying in August is Dicker Data. It is a wholesale distributor of computer hardware and software which has grown its earnings and dividends at a consistently solid rate for many years.

The good news is that this positive trend is continuing in 2020 despite the pandemic. Dicker Data recently released a first half update which revealed very strong profit growth. As a result, management advised that it plans to lift its full year dividend by 31% to 35.5 cents per share. This represents a very attractive 4.7% fully franked dividend yield.

More reading

• Why the Wesfarmers share price is too expensive
• Why I would buy Goodman Group and these blue chip ASX shares
• Are ASX retail shares buys right now?
• Kogan share price in spotlight after it releases new profit update
• ASX 200 Weekly Wrap: Surging commodity prices snap ASX 200’s losing streak

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Dicker Data Limited. The Motley Fool Australia owns shares of Wesfarmers 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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The Domino’s Pizza Enterprises Ltd (ASX: DMP) share price has been an exceptionally strong performer in 2020.

The pizza chain operator’s shares have ignored the market volatility and zoomed an incredible 42% higher since the start of the year.

This means the Domino’s share price is trading within touching distance of its record high ahead of its full year results for FY 2020 on 19 August.

What is Domino’s expected to deliver in FY 2020?

Ahead of its results release, I thought I would take a look to see what the market expects Domino’s to deliver along with its pizzas in FY 2020.

According to a note out of Goldman Sachs, its analysts have increased their estimates to reflect stronger than expected updates from a number of its global peers.

Goldman Sachs is forecasting same store sales (SSS) growth of 4.5% for FY 2020, leading to total sales of $1,969.3 million. This comprises total ANZ sales of $717.4 million, Europe sales of $618.3 million, and Japan sales of $633.6 million.

It then expects this to lead to earnings before interest, tax, depreciation, and amortisation (EBITDA) of $310.8 million. This will be a 10.1% increase on the prior corresponding period.

And on the bottom line, Goldman has forecast net profit after tax of $152.4 million, which will be a 7.9% increase on the prior corresponding period. This is a touch short of the consensus estimate of $155.1 million.

The broker also expects Domino’s to grow its final dividend. It has forecast a 9.8% increase to 58 cents per share, with 75% franking.

How will its segments perform?

Goldman Sachs expects its ANZ segment to deliver 3% SSS growth in FY 2020, leading to EBITDA of $136 million. It estimates that there will be 832 stores in the ANZ market at the end of the period.

Even stronger growth is expected in Europe, with the broker forecasting SSS growth of 4.5%. It expects its 1,160 stores in the region to contribute $91.2 million in EBITDA. And in Japan, it has forecast a 7% increase in SSS, resulting in EBITDA of $96.4 million for the year.

Finally, corporate costs are expected to be $13 million for the year.

Should you invest?

I think Domino’s shares are arguably fully valued now. However, I still believe they could be a great option for investors that are looking for long term options. This is due to its bold store expansion and SSS targets over the coming years. Though, given how close its results release is, it might be prudent to wait until after that before investing.

More reading

• Will the Domino’s share price continue to surge in August?
• Why I would buy NEXTDC and these stellar ASX growth shares
• Why the Domino’s share price has my attention
• Top brokers name 3 ASX shares to sell today
• a2 Milk and 1 other quality ASX 200 share to buy and hold beyond 2026

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Domino’s Pizza Enterprises 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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Australian copper miner OZ Minerals Limited‘s (ASX: OZL) share price rocketed 24.3% in July. Over that same time, the S&P/ASX 200 Index (ASX: XJO) gained a meagre 0.5%.

OZ Minerals wasn’t spared from the COVID-19-driven market rout that savaged most ASX shares. From 21 February through 23 March, the OZ Minerals share price plunged a gut-wrenching 40%.

Since then, it’s been uphill all the way for the copper miner. By the end of the trading day on 31 July, the share price had gained a whopping 128% from it 23 March low.

Year-to-date, OZ Minerals share price is up 35.3%. The current price of $14.34 per share gives the company a market cap of $4.6 billion.

What does OZ Minerals do?

Based in South Australia, OZ Minerals is mining company primarily focused on copper. It owns and operates the high-quality Prominent Hill copper-gold mine and the Carrapateena advanced exploration copper-gold project. Both sites are located in South Australia.

The company had $15 million in net cash (unaudited) at 30 June and had a $480 million revolving credit facility.

What fuelled the OZ Minerals share price rise in July?

OZ Minerals has clearly benefited from the rising price of copper, its primary focus. During July, the price of copper went from US$6,015 per dry metric tonne to US$6,413, an increase of 6.6%. It’s also worth noting that the price of copper gained 39% from its 24 March low through 31 July.

Topping off the big gains in copper for OZ Minerals mines, July kicked off nicely for the company when JP Morgan upgraded the company from “neutral” to “overweight”. That came after the big name broker re-evaluated its initial value ascribed to OZ Minerals’ Carrapateena block cave project, with both ore grades and the mine life upgraded.

JP Morgan put its 12-month target for the OZ Minerals share price at $12.80 a share. In late afternoon trading today, the miner was trading at $14.34 per share.

A second top broker, Macquarie Group Ltd (ASX: MQG) named OZ Minerals as one of its “counter consensus calls“, believing the miner’s financial year 2020 earnings per share estimates will come in higher than consensus forecasts.

This was borne out by OZ Minerals’ quarterly report, released on 22 July. The company raised its financial year 2020 production guidance from 83,000-100,000 tonnes of copper to 88,000-105,000 tonnes. If that holds true, the OZ Minerals share price could have further to run.

More reading

• These record breaking ASX stocks just got downgraded by top brokers
• Has the ASX 200 finally taken off?
• ASX 200 up 1%: Challenger disappoints, Sydney Airport to raise $2bn, a2 Milk names new CEO
• ASX iron ore miners jump on broker upgrades
• 3 tips for beginners investing in ASX shares

Motley Fool contributor Bernd Struben has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Macquarie 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.

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The market continues to power ahead on a better than expected start to the reporting season, but valuations for some ASX stocks are getting hard to justify.

The S&P/ASX 200 Index (Index:^AXJO) jumped 0.5% in after lunch trade with most sectors making gains.

But brokers warn that some stocks are starting to look overbought and have downgraded their recommendations on the following ASX stocks.

Tasting a tat too rich

One stock that got cut today is the Breville Group Ltd (ASX: BRG) share price, which is trading at a record high of $28.50 at the time of writing.

A big profit upgrade by JS Global is fuelling enthusiasm for Breville as the Chinese kitchen appliance maker is enjoying strong demand for its products.

That bodes well for Breville although Credit Suisse is struggling to keep the stock on its “buy” list after the BRG share price surged by more than 160% since March.

Big premium drives downgrade

“BRG is trading on an unusually high 224% premium to the ASXI [ASX Industrials Index] and the COVID-19 environment remains highly uncertain,” said the broker.

“We therefore think this is a good opportunity to take stock.”

Credit Suisse downgraded the stock to “neutral” from “outperform” two days before the company hands in its profit results.

However, the broker lifted its 12-month price target to $26.81 from $20.27 a share to reflect the positive sales momentum for its products.

When an upgrade leads to a downgrade

Another stock to be hit with a downgrade despite positive trading conditions is the Mineral Resources Limited (ASX: MIN) share price.

Shares in the mining services group also hit a record high of $28.32 this afternoon, thanks in no small part to brokers upgrading their forecast iron ore price for the next few years.

Mineral Resources benefits from the more positive outlook for the steel making commodity. Not only does it offer mining services (like crushing) to some of the world’s largest iron ore miners, it also owns iron ore and mineral sands projects.

Better value elsewhere

JP Morgan is one of the brokers that lifted its price estimates for the commodity. It expects iron ore to average US$100 a tonne in 2021 (up 19%) and that prompted it to lift its price target on Mineral Resources to $21.40 a share from $18.80.

However, the MIN share price is trading too far above the upgraded valuation, which forced JP Morgan to downgraded its rating on Mineral Resources to “underweight” from “neutral”.

More reading

• Here’s why the OZ Minerals share price rocketed 24% in July
• Has the ASX 200 finally taken off?
• ASX 200 up 1%: Challenger disappoints, Sydney Airport to raise $2bn, a2 Milk names new CEO
• ASX iron ore miners jump on broker upgrades
• 3 tips for beginners investing in ASX shares

Motley Fool contributor Brendon Lau owns shares of Breville Group Ltd. 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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Is the Vanguard US Total Market Shares Index ETF (ASX:VTS) a good long-term investment? I’m going to explain why it is. 

Exchange-traded funds (ETFs) are a great way for people to invest in the share market. Most ETFs give the investor an easy way to invest in a large number of shares with a single investment. Some ETFs may invest in 100 to 300 shares and others are invested in thousands.

Many ETFs also come with low operating costs, much lower than active fund managers. The lower the cost the higher the net returns – which is obviously the most important thing for investors.

Vanguard US Total Market Shares Index ETF

This ETF is invested in most of the US share market. At the end of June 2020 it had 3,531 positions. That’s extremely diversified in my opinion. Diversification reduces the risk of any particular business or industry hurting the overall portfolio’s return too much.

Looking at the particular industry allocations with more than a 5% weighting: 25.2% of the ETF is invested in technology, 16.6% is invested in financials, 14.6% is invested in health care, 14% is allocated to consumer services, 12% is invested in industrials and 7.9% is invested in consumer goods.

I like the spread of the businesses across different industries in the US Total Market Shares Index ETF. There is a fair bit allocated to technology, but this is the sector that’s seeing the most growth. If I could pick which industry to have the most exposure to, it would be technology.

Holdings

This ETF holds all of the US’ best businesses in its holdings. Its top ten holdings are among the best and most well-known businesses in the world.

At 30 June 2020 its leading holdings were: Microsoft, Apple, Amazon.com, Alphabet, Facebook, Johnson & Johnson, Berkshire Hathaway, Visa, Proctor & Gamble and UnitedHealth.

Its holdings further down the list are names like Home Depot, Mastercard, JPMorgan Chase, Intel, Verizon, Nvidia, AT&T, Adobe, PayPal, Walt Disney, Netflix, Merck & Co, Exxon Mobil, Bank of America, PepsiCo, Pfizer, Comcast and Cisco.

Many of the above businesses have strong profit margins and long-term growth potential.

Plenty of the stocks within US Total Market Shares Index ETF are global giants within their sectors. Global earnings provides much more growth potential and also means it can be more resilient as well – it’s unlikely they every region would be suffering at the same time. Apart from something like this COVID-19 pandemic.

Look at the big technology companies. They are involved in changing how the world runs with their cloud computing offerings. Virtual reality and AI is going to be dominated by the these businesses. Automated cars could become a huge division for Alphabet’s Waymo.

Fees

As I’ve mentioned, the lower the fees the better.

Vanguard US Total Market Shares Index ETF has annual management fees of just 0.03% per annum. That’s one of the lowest available for ASX investors. It’s so low that you’d hardly see any difference between the gross return and the net return.

Returns

The net returns of an investment are the most important thing. Over the past year the ETF has delivered a net return of 16.2%. Over the past decade it has delivered an average return per annum of 15.3%.

Past performance is not a guarantee of future performance. However, I think it shows the types of returns that this ETF’s holdings can generate over the long-term. However, most of the return will be in the form of capital growth because it has a fairly low dividend yield.

Foolish takeaway

I think Vanguard US Total Market Shares Index ETF is one of the best options to invest into US shares. It has extremely low operating costs, very good diversification and its largest weightings is to high-growth technology shares.

It’s a pretty good time to buy shares because the Australian dollar has strengthened. However, I think that the upcoming US election could create more volatility for the US share market – that could be a good time to invest.

More reading

• Here’s why the OZ Minerals share price rocketed 24% in July
• These record breaking ASX stocks just got downgraded by top brokers
• 3 ASX shares fighting COVID-19 and rewarding shareholders
• Flight Centre and Zip Co were among the most traded shares on the ASX last week
• Has the ASX 200 finally taken off?

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Australia’s fight against coronavirus continues with Victoria in lockdown as the government battles to suppress the virus. Managing the pandemic involves a host of government and private sector resources, with many ASX shares involved in the fight. ASX companies are involved in everything from manufacturing PPE, to testing for the virus, to supplying equipment and treatments to assist COVID-19 patients.

Here we take a look at 3 ASX shares that are actively involved in the fight against coronavirus.  

Atomo Diagnostics Ltd (ASX: AT1) 

Atomo Diagnostics operates in the medical device space, emerging as a leader in the development of point of care devices for rapid diagnostic testing (RDT). The company’s AtomoRapid RDT platforms are customisable to suit a variety of applications, including screening for chronic conditions and detection of infectious diseases. This week the Therapeutic Goods Administration (TGA) approved Atomo’s COVID-19 rapid antibody test.

The TGA approval means Atomo can now sell the COVID-19 tests to medical professionals. The test is jointly manufactured with a French company, NG Biotech, which manufactures the test strip. Atomo manufactures the testing device. The test has already been approved and sold in France by NG Biotech. Atomos is in commercial discussions to assess distribution channels for the test in Australia. 

“We see strong potential use of our test across a number of channels in Australia and we believe TGA approval will accelerate these negotiations,” Managing Director John Kelly explained.

“The proven ease of use of the Atomo device in the field makes our test well suited for deployment in a large country like Australia, with a variety of point of care settings,” he added. 

The Atomos share price gained 17% at its peak following announcement of the TGA approval. The share price has since settled somewhat and is currently trading 11.7% up from its pre-announcement price. The company only debuted on the ASX in April, becoming the first company to do so since the pandemic took hold. Atomos raised $30 million from its IPO at an offer price of 20 cents per share. With shares now trading at 34 cents, IPO investors are already sitting on a substantial profit. 

Resmed Inc (ASX: RMD) 

Resmed is a medical equipment company that provides devices for the treatment of sleep apnea and chronic obstructive pulmonary disease (COPD). The company makes continuous positive airway pressure masks and machines and life support ventilators. Production of the latter was ramped up in response to the COVID-19 pandemic with the machines used to help patients breathe while their immune system fights coronavirus. Resmed pivoted its business in response to the pandemic, increasing manufacture of ventilators and mask systems for hospitals treating pandemic patients. 

Resmed’s long term strategy revolves around supporting customers with digital health technologies and out-of hospital management software. This enables better care for those suffering from sleep apnea, COPD, and asthma. Over the longer term, Resmed believes its strong foundation will accelerate adoption of digital health solutions in the respiratory medicine field. In the meantime, the company is actively involved in the delivering solutions used in the treatment of coronavirus patients. 

The increased demand for Resmed products has been reflected in its results. Revenue increased 9% in the fourth quarter to $770.3 million, and 13% over the full year to $3 billion.

Mick Farrell, Resmed’s CEO, commented: “Throughout our fiscal fourth quarter we continued to support the COVID-19 pandemic response through increased manufacturing of our ventilators while also supporting our customers with digital health solutions and other innovative tools to enable remote care for patients.” 

In FY20, Resmed’s net operating profit increased 40%, giving NON-GAAP diluted earnings per share of $4.76, up from $3.64 in FY19. But this wasn’t enough for investors, who sent the Resmed share price tumbling last week when results were announced. The share price has fallen 11.7% since results were released with shares currently trading at $24.79 (at the time of writing). But the Resmed share price is still up more than 27% over the past year, so investors are looking at solid returns. 

Fisher & Paykel Healthcare Corp Ltd (ASX: FPH) 

Fisher & Paykel Healthcare manufactures products and systems used in respiratory care, acute care, and in the treatment of obstructive sleep apnea. The healthcare company upgraded its earnings guidance early in the pandemic as demand for its respiratory humidifiers and consumables increased. Both are used directly in treating coronavirus patients.

Fisher & Paykel also benefitted from stronger sales in its homecare product range and a weakening of the NZ dollar, leading it to update revenue and profit guidance to $1.24 billion and $275 million–$280 million, respectively.  

Fisher & Paykel’s financial year ended 31 March 2020 with the company exceeding its forecasts. Operating revenue was $1.26 billion, up 18% on the previous year. Net profit after tax was $287.3 million. The increase in revenue was largely driven by demand for products to treat COVID19 patients, as well as strong hospital hardware sales and demand for Fisher & Paykel’s Optiflow nasal high flow therapy. 

“The 2020 financial year was already on track to deliver strong growth before coronavirus impacted sales,” said Managing Director and CEO Lewis Gradon. “Beginning in January, the demand for our respiratory humidifiers accelerated in a way that has been unprecedented.”

By adopting new processes and procedures, the company was able to double, and in some instances, triple, output for some hospital hardware products over just a few months. 

The hospital product group, which includes products in respiratory and acute care, saw operating revenue increase 25%. The homecare product group, which includes products used in the treatment of obstructive sleep apnea and home respiratory support, saw revenue rise 9%.

Fisher & Paykel’s priority is to invest in the business to support long term sustainable growth. Dividends are expected to increase as earnings grow, taking into consideration the company’s target gearing ratio. Investors have been impressed by Fisher & Paykel Healthcare’s growth, sending the share price up 110% over the past year. 

Foolish takeaway 

These ASX shares are directly involved in the fight against coronavirus. From diagnosing the disease to treating its patients, these ASX shares are combatting the pandemic while delivering strong returns to shareholders. 

More reading

• Has the CSL share price lost its ASX 200 market darling status?
• These ASX healthcare shares could be fantastic long term options
• Why CIMIC, oOh!Media, ResMed, & Resolute shares are dropping lower
• These were the worst performing ASX shares last week
• ASX 200 Weekly Wrap: Surging commodity prices snap ASX 200’s losing streak

Motley Fool contributor Kate O’Brien has no position in any of the stocks mentioned. The Motley Fool Australia has recommended ResMed Inc. 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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Investment platform provider CommSec has just released data on the five most traded ASX shares on its platform from last week.

Once again, the list includes two of the most popular buy now pay later providers on the ASX. They were joined by two of the big four banks and a beaten down travel company.

Here’s the data:

National Australia Bank Ltd (ASX: NAB)

National Australia Bank shares were popular with investors last week and were the most traded on the CommSec platform. The NAB share price tumbled 4% over the period, possibly due to a broker notes out of Macquarie. Although the broker downgraded NAB to an underperform rating with a $17.50 price target, there were still more buyers than sellers. NAB shares accounted for 2.1% of total trades on the platform, with buyers accounting for 75% of these trades.

Zip Co Ltd (ASX: Z1P)

This buy now pay later provider continues to be popular with CommSec investors. It was responsible for 2% of all trades on the platform during the week. And although the buying and selling was evenly split, the Zip Co share price pushed 4% higher during the week.

Afterpay Ltd (ASX: APT)

Another buy now pay later provider that remains popular with investors is Afterpay. It accounted for 1.7% of total trades on the CommSec platform last week. However, there were more sellers than buyers, with 59% of trades coming from sellers. Despite this, the Afterpay share price rose 3.15% over the period. This stretched its year to date gain to almost 150%.

Westpac Banking Corp (ASX: WBC) 

Westpac was among the most traded shares for a second week in a row. The banking giant’s shares accounted for 1.6% of trades on the CommSec platform, with 71% of these trades from buyers. Despite this buying pressure, it wasn’t enough to stop the Westpac share price from losing 2% over the period. However, these buyers have been rewarded this week, with the big four banks charging higher on Monday and Tuesday.

Flight Centre Travel Group Ltd (ASX: FLT)

This travel agent’s shares have entered the top five, contributing 1.5% of total trades on the CommSec platform. With 65% of these trades coming from buyers, it appears as though investors may believe recent share price weakness has been a buying opportunity. This has certainly proven to be the case this week. The Flight Centre share price is up 9% week to date at the time of writing.

More reading

• Why this reporting season is different, and now’s a great time for ‘buy to hold’ investors in ASX shares
• Why I would buy and hold Afterpay and Xero shares
• ASX stock of the day: Moneyme share price surges 36% as lender enters buy now, pay later space
• Why Afterpay, Challenger, IVE Group, & Mesoblast shares are dropping lower
• 3 tips for beginners investing in ASX shares

James Mickleboro owns shares of Westpac Banking. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of ZIPCOLTD FPO. The Motley Fool Australia owns shares of AFTERPAY T FPO. The Motley Fool Australia has recommended Flight Centre Travel 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.

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The S&P/ASX 200 Index (ASX: XJO) is having a top day today. On the surface, the 0.88% gain the ASX 200 has so far added today (at the time of writing) doesn’t seem that special. But consider this: with this rise, the ASX 200 is sitting at 6,164.10 points, its highest level since early March. Between 23 March and 9 June, the index rose around 35% off of its low. But since then (over a period of 2 months), the ASX 200 has essentially been stuck in a rut around the 6,000 point mark.

Just take a look at the chart below for some context:

See what I mean?

And yet today, the rut has seemingly been broken. So is the ASX 200 about to take off once again? Remember, although investors have enjoyed some solid gains since March, the ASX 200 is still down around 14% from the highs we saw back in February.

Why are ASX 200 shares surging?

I think there are 2 reasons why ASX shares are moving higher this week (so far anyway).

Firstly, commodity prices have been pushing higher in recent weeks. We have seen iron ore holding around US$117 a tonne, as well as gold making new record highs above US$2,000 an ounce. Some of the ASX 200’s largest holdings are iron ore miners like BHP Group Ltd (ASX: BHP), Rio Tinto Limited (ASX: RIO) and Fortescue Metals Group Limited (ASX: FMG).  The ASX’s largest gold miner Newcrest Mining Limited (ASX: NCM) is no minnow either at a near-$30 billion market capitalisation. These companies are all at or near multi-year highs today, which has helped push the index higher.

Secondly, investors now have increased confidence over the government backstop over the economy. The federal government has confirmed subsidies like JobKeeper and the coronavirus supplement are sticking around until at least the end of the year (March 2021 in JobKeeper’s case). Right now, I think it’s fair to say that these programs are holding the economy up, and their previously-scheduled September end date was a concern for many investors. Knowing this safety net will remain in place for at least the rest of the year is helping to boost investors’ confidence, in my view.

Where to from here?

Perhaps the ASX 200 pushes even higher from here, reclaiming the 7,000 point threshold we saw at the start of the year. Perhaps the market retreats tomorrow back into its 6,000 point rut. Frankly, I, nor anyone else, has no idea of what will happen next. Here’s what we do know though. The coronavirus crisis, unfortunately, isn’t going away anytime soon. In fact, it may well get worse before it gets better  (fingers crossed for the negative).

I see a lot of downside risk right now, and not much to make me confident in a huge climb higher. I’m not selling shares of my favourite companies, mind you. But I am trying to maximise my cash position all the same.

More reading

• ASX 200 up 1%: Challenger disappoints, Sydney Airport to raise $2bn, a2 Milk names new CEO
• ASX iron ore miners jump on broker upgrades
• Are ASX lithium shares the next big thing?
• 3 tips for beginners investing in ASX shares
• ASX reporting season reveals some upside surprises

Motley Fool contributor Sebastian Bowen owns shares of Newcrest Mining Limited. 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 Goodman Group (ASX: GMG) share price gained 14.0% in July. That came during a difficult month for many real estate-focused shares, and a month that saw the S&P/ASX 200 Index (ASX: XJO) gain only 0.5%

Like the vast majority of Australian companies, the Goodman Group share price took a heavy hit from the COVID-19 sharemarket selloff in February and March. Goodman shares tumbled more than 42% from 19 February to 19 March.

Then things turned around for the company. The Goodman Group share price rallied strongly from its 19 March low, gaining 75% by the closing bell on 31 July, trading for $16.93 per share.

Year-to-date, the group’s share price is up an impressive 33%. At the current share price of $17.98 per share, Goodman has a market cap of 32.9 billion.

What does Goodman Group do?

Goodman Group is an integrated property group with operations throughout Australia, New Zealand, Asia, Europe, the United Kingdom, North America and Brazil.

The group was formed following the merger of Macquarie Goodman Industrial Trust and Macquarie Goodman Management in 2005. Goodman operates 4 divisions: property investment, fund management, property services and property development.

Today, Goodman Group is the largest real estate investment trust (REIT) in Australia, which makes Goodman shares a favourite of listed property enthusiasts. Goodman shares first listed on the ASX on 2 February 2005. The group now takes its place as one of the largest companies on the Australian sharemarket, with total assets under management of $55 billion across 395 properties globally as of March 2020.

Why did the Goodman Group share price leap 14% in July?

While many REITs have struggled with the pandemic shutdowns, the Goodman Group share price had more than recouped all of its February and March losses, and then some, by the end of July.

Much of Goodman’s share price success is due to the company’s large exposure to industrial properties like warehouses and logistics facilities. The surge in online shopping and delivery services during the pandemic has seen a sharp increase in demand for these facilities. The group counts Amazon.com (NASDAQ: AMZN) as its largest client.

And Goodman Group’s future growth outlook is strong, with $4.8 billion of development work underway.

The Goodman Group share price also received a lift in early in July after analysts at Macquarie Group Ltd (ASX: MQG) named it as one of their best buy ideas for the reporting season currently underway.

More reading

• Why I would buy Goodman Group and these blue chip ASX shares
• 3 core holdings for a $100,000 ASX portfolio
• Buy these outstanding ASX 50 shares for strong potential returns
• 5 things to watch on the ASX 200 on Monday
• 3 coronavirus ASX shares to buy as consumer preferences change

John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Bernd Struben 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 owns shares of and has recommended Macquarie Group Limited. 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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