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The BlueScope Steel Ltd (ASX: BSL) share price is backtracking today while the S&P/ASX 200 Index (ASX: XJO) is travelling higher.

During midday trade, the steel producer’s shares are down 1.82% to $16.15.

For context, the benchmark ASX 200 index is up 0.14% to just under 6,860 points.

Let’s take a look at what’s dragging BlueScope shares lower on Tuesday.

Why is the BlueScope share price losing ground today?

With earnings season all wrapped up, the BlueScope share price is now trading ex-dividend.

This comes after the company delivered a robust full-year result, reporting a record performance which led to $2.81 billion in net profit after tax (NPAT).

On the back of the outstanding achievement, the board declared an unfranked final dividend of 25 cents per share.

If you bought the company’s shares before market close yesterday and held onto them until this morning, you’ll be eligible for the dividend.

Be sure to check your bank accounts on 12 October as that’s when BlueScope will make its dividend payment to shareholders.

In case you were wondering, there’s no dividend reinvestment plan (DRP) currently being offered.

BlueScope noted that it has made nearly $1 billion in shareholder returns across FY 2022. This includes $344 million in dividends and $638 million in on-market buybacks.

Further, the board approved an increase to the share buyback program to allow up to a further $500 million to be bought over the next 12 months.

It’s likely that with such a significant buyback program, BlueScope shares could continue to rise.

BlueScope share price summary

In 2022, BlueScope shares have fallen 23% on the back of China’s property crisis and iron ore price setback.

On the other hand, the S&P/ASX 200 Materials Index (ASX: XMJ) is down 8% over the same time frame.

BlueScope shares reached a 52-week low of $14.75 in July before making a slight recovery.

Based on today’s price, BlueScope commands a market capitalisation of approximately $7.58 billion and has a dividend yield of 3.11%.

The post Why is the BlueScope share price dipping on Tuesday? appeared first on The Motley Fool Australia.

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More reading

• Looking to bank the next BlueScope dividend? Here’s what to do
• 5 ASX 200 shares turning ex-dividend tomorrow
• ASX 200 shares declared $42b of dividends in August. Here’s how you can get a slice
• 3 ASX 200 shares having a super start to the week
• Why BlueScope, Carsales, Core Lithium, and Nearmap shares are racing higher

Motley Fool contributor Aaron Teboneras 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.

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It’s a scary time on the market for many invested in ASX shares. The S&P/ASX 200 Index (ASX: XJO) has dumped 10% year to date and two of Wall Street’s three major indexes have fallen into bear markets.

But Airlie Funds Management’s Emma Fisher isn’t worried. The portfolio manager reportedly welcomes volatility and the stock picking prospects it brings.

Here’s how the fundie is taking advantage of recent turbulence in the market.

Market downturns or buying opportunities?

“It sounds counterintuitive, but you’ve got a better chance of making good money when markets are down,” Fisher said, as quoted by the Australian Financial Review (AFR).

Fisher continued:

We welcome volatility, we welcome short-termism because it increases the chance that you’re going to be able to buy mispriced assets.

While concerns of stalling growth and even a potential recession have swirled in some circles recently, Fisher has been eyeing a new set of opportunities.

The publication quoted Fisher as saying:

The thing about the dominant narrative is we love it … because if it’s driving the headlines, then it’s probably creating opportunities.

It’s not saying that the dominant narrative of, say, economic turmoil is wrong, and that it’s not going to happen. It’s saying it’s been more than priced into some stocks, in some sectors.

And the best place to be during such volatility? ASX shares.

The fundie said Australia’s housing market, filled to the brim with variable mortgages, will likely mean rate hikes will impact the economy faster here. Therefore, the Reserve Bank of Australia could get away with fewer hikes than other central banks.

Meanwhile, Aussie companies’ balance sheets are stronger than they have been in previous downturns.

Should ASX investors get defensive?

Investors may be tempted to turn to defensive stocks but Fisher warned this could set them back.

She said some defensive stocks are currently trading at “eye-wateringly expensive” levels. Meanwhile, other consumer-facing businesses have been “bombed out”, but their earnings remain “too high”.

Fisher said, courtesy of the AFR:

Our playbook there is to really focus on the balance sheets of these companies. Because the market’s probably right that earnings are too high, but valuations have now priced that in.

If you’re looking at consumer discretionary-facing businesses, you want to own businesses that are pretty much net cash or that they own a lot of property.

3 ASX retail shares that might be worth looking at

Fisher and fellow portfolio manager Matt Williams have reportedly flagged three ASX retail shares that meet the criteria.

These include Nick Scali Limited (ASX: NCK) and Premier Investments Limited (ASX: PMV).

The former closed financial year 2022 with $74.6 million in cash and $97.4 million worth of property. It also boasted an outstanding order bank of $185 million.

The latter is behind such brands as Peter Alexander, Jay Jays, and Just Jeans. It ended the first half with a net cash position of $400 million.

Finally, Fisher reportedly dubbed four-wheel drive accessories retailer ARB Corporation Limited (ASX: ARB) a quality business trading at a reasonable price.

The three ASX retail shares have fallen 32%, 31%, and 46% respectively year to date.

The post ‘Better chance of making good money when markets are down’: fundie appeared first on The Motley Fool Australia.

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More reading

• ASX dividend windfall continues but it’s not just Woodside and ASX 200 energy stocks splashing the big cash
• Top brokers name 3 ASX shares to buy today
• ARB share price plunges amid ‘uncertain’ outlook
• Earnings preview: Here’s which ASX shares are reporting today
• Why EML, Nearmap, NIB, and Nick Scali shares are charging higher

Motley Fool contributor Brooke Cooper has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has recommended ARB Corporation Limited and Premier Investments Limited. 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 BHP Group Ltd (ASX: BHP) share price is seeing significant volatility at the moment. But are things going to get better for the ASX mining share?

Since 26 August, BHP shares have dropped by more than 10%. However, a large part of the decline might be due to the share going ex-dividend. This means that new investors who bought shares on or after the ex-dividend date are no longer entitled to the final FY22 dividend.

But with the dividend allocation date out of the way, and with the BHP share price down, is it worth thinking about the mining giant?

Can the good times continue?

BHP had a very strong 2022 financial year. It generated US$21.3 billion of continuing operations underlying attributable profit (up 26%), reduced its net debt by 92% to US$333 million, and increased its ordinary dividend by 8% to US$3.25 per share.

Not only is BHP making a lot of money for shareholders but it’s also paying a lot of money to governments. Its 2022 economic contribution report showed that A$18.5 billion has been allocated to Australian governments in taxes, royalty-related income taxes, royalties, and other payments.

In fact, the company is one of the largest taxpayers in Australia. It expects to fund approximately 10% of total Australian company tax, compared to the budgeted cash receipts by the federal budget.

Can BHP keep making big profits? Let’s look at what the company said in its annual report about the outlook for some commodities, given it’s the resources themselves that can have a key impact on earnings and the BHP share price.

Copper

BHP noted that the copper price has fallen due to two reasons in two stages:

The first decline was due to the demand impact of China’s COVID-19 lockdowns. The second was due to recession speculation in advanced economies. We believe mine supply and scrap collection will grow in the coming few years, covering near-term demand growth.

In the longer term, BHP thinks that traditional end-use demand is expected to be “solid”, while broad exposure to the electrification megatrend offers “attractive upside”.

In FY23, the copper production is expected to be between 1,635kt to 1,825kt. However, the company warned that Escondida unit costs are expected to be between US$1.25 to US$1.45 per pound, largely reflecting “inflationary pressures”.

Iron ore

BHP’s biggest profit generator is usually iron ore. That means the outlook for iron could have the biggest influence on the BHP share price.

But, near the end of FY22, weakening sentiment within the steel value chain fed back into lower prices for iron ore. The mining giant said:

Looking ahead, the key near-term uncertainties are the pace of steel end-use sector recovery in China, how the Chinese authorities administer steel production costs in the remainder of the 2022 calendar year, and the performance of seaborne supply.

In the medium-term, China’s demand for iron ore is expected to be lower than it is today as crude steel production plateaus, and the scrap-to-steel ratio rises.

In the long-term, prices are expected to be determined by high-cost production, on a value-in-use adjusted basis, from Australia or Brazil. It is imperative that we continue to compete on both quality and operational effectiveness.

Western Australian iron ore production for FY23 is expected to increase to between 246mt to 256mt, reflecting the tie-in of the port debottlenecking project and the continued ramp-up of South Flank.

FY23 unit costs are expected to be between US$18 to US$19 per tonne.

Other commodities

With metallurgical coal, the price has descended from extreme highs. BHP said the industry faces a “difficult and uncertain” period ahead. There is uncertainty about China’s import policy and Russian coal supply. But, it believes that a wholesale shift away from blast furnace steelmaking is still “decades in the future”.

Nickel prices also saw a spike but have since fallen back to pre-Ukraine invasion prices due to “recession fears”. In the longer term, BHP believes that nickel will be a “core beneficiary of the electrification megatrend and that nickel sulphides will be particularly attractive”.

My view on the BHP share price

It’s certainly possible that the iron ore price and BHP share price could go lower. But an end to Chinese COVID lockdowns could be a positive development.

With the BHP share price down 28% since April, I think it’s in the buy zone for the long term. I like its focus on decarbonisation resources like copper, nickel, and potash.

The post What’s the outlook for the BHP share price in September? appeared first on The Motley Fool Australia.

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More reading

• August’s RBA rate hike saw investors favour Macquarie and BHP shares. Here’s what to expect in September: expert
• Why are BHP shares off and racing on Monday?
• How I’d invest $50,000 in ASX dividend shares for retirement, if I had to start from scratch
• Why did the BHP share price smash the ASX 200 in August?
• 27% of ASX 200 shares cut dividends during earnings season. What’s next?

Motley Fool contributor Tristan Harrison 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.

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The Whitehaven Coal Ltd (ASX: WHC) share price is leaping again today amid higher coal prices.

The Whitehaven share price has lifted to an all-time high of $8.83, a 4% gain on yesterday’s close.

Let’s take a look at why Whitehaven is having such a good day.

Rising coal prices

The Whitehaven share price is lifting after coal prices surged overnight. Whitehaven is a coal producer and exporter of thermal and metallurgical coal.

European coal prices lifted 7.6% to an all-time high of $345 per tonne, Bloomberg reported. After Russia cut off gas supplies to Europe via the Nord Stream 1 pipeline, European nations are looking at alternative energy sources including coal.

For example, Greece is going to keep seven coal-fired power stations open for longer, Reuters reported overnight. Germany has previously indicated it will need to keep coal stations open to save gas.

Maria Rita Galli, CEO of Greece natural gas operator DESFA, said in comments cited by the publication:

In the short term some European countries will have a delay in their decarbonisation (plan), but this could also be an opportunity … allowing to avoid an intermediate phase towards hydrogen.

Whitehaven delivered a record net profit after tax (NPAT) of $1.95 billion in recent FY22 financial results.

Commenting on the impact of coal prices on these results, CEO Paul Flynn said, “Coal prices are at record levels and customers are focused on energy security now more than ever before.”

Morgans has recently recommended that investors add Whitehaven to their portfolios.

Share price snapshot

The Whitehaven share price has soared 203% in the past year and is up 236% year to date.

In the past month, the Whitehaven share price has lifted 46%.

Whitehaven has a market capitalisation of nearly $8.4 billion.

The post Whitehaven share price surges to yet another all-time high, here’s why appeared first on The Motley Fool Australia.

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More reading

• The Whitehaven share price has surged 36% in a month. Why Morgans predicts more ‘supercharged returns’
• Here are the top 10 ASX 200 shares today
• 3 ASX All Ords shares smashing new highs on Monday
• Why is the Whitehaven share price having such a stellar session today?
• Why are ASX 200 coal shares smashing the market on Monday?

Motley Fool contributor Monica O’Shea 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.

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Time is running out to secure the Medibank Private Ltd (ASX: MPL) dividend.

Because by this time tomorrow, it will have reached its ex-dividend date, which is the time when shares trade without their dividend.

Here are some important details to keep in mind.

Medibank dividend

Medibank offers investors an interim dividend of 7.3 cents per share. It’s fully franked too, so it carries certain tax benefits.

The dividend is payable on 29 September and has a trailing dividend yield of 3.7%.

You must hold Medibank shares before the ex-dividend date to receive the dividend.

Zooming out a little, we see that 7.3 cents per share is the highest dividend the company has ever offered investors in its dividend history, stretching back to 2015.

As my Fool colleague Cathryn pointed out, this is likely due to the company seeing a 9% boost in its net profit after tax (NPAT) for FY22 and, thus, being able to distribute higher profits to investors.

Medibank share price snapshot

Shares of Medibank currently trade for $3.655 each, up 0.69% on yesterday’s closing price of $3.63.

The Medibank share price is up 9.25% year to date. Meanwhile, the S&P/ASX 200 Index (ASX: XJO) is down around 8% over the same period.

The company’s current market capitalisation is approximately $10 billion.

The post Hoping to bag the latest Medibank dividend? Read this appeared first on The Motley Fool Australia.

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More reading

• These 9 ASX 200 shares are going ex-dividend tomorrow
• Can the Medibank share price deliver healthy growth and dividends?
• Analysts name 2 ASX 200 dividend shares to buy now
• 3 ASX 200 shares breaking multi-year highs on Tuesday
• Why did the Medibank share price just crack a new all-time high?

Motley Fool contributor Matthew Farley 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.

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The Lake Resources NL (ASX: LKE) share price is stretching higher in early trade on Tuesday.

At the time of writing, shares in the ASX lithium player are trading 5% in the green at $1.16 on no news.

Meanwhile, materials is the third best performing sector from the open on Tuesday, with the S&P/ASX 200 Materials Index (ASX: XMJ) 0.49% in the green.

What’s up with the Lake Resources share price?

Investors have rallied Lake shares today in unison with the broader sector, as materials shares catch another heavy bid.

Lake Resources shares have bounced from lows and are now heading back to range levels, having slipped from previous highs of $1.59 on 11 August.

There’s been nothing price-sensitive out of Lake’s camp this past month that correlates to the volatility in pricing seen on the chart.

Noteworthy, however, is a bullish note out of JP Morgan on its outlook on the future of the lithium industry.

Citing asymmetries in supply and demand, the broker revised its forecasts for lithium carbonate and spodumene prices by 20% and 25% respectively.

The note provided a bullish undercurrent for speculators and those positioned for the long-term in lithium, with the ASX lithium basket subsequently rallying to date.

If one recalls the calamity that a bearish note from Goldman Sachs on the lithium industry’s outlook caused in June – if this were to happen in reverse, lithium shares could rally further.

To that point, it appears that Goldman may be seeking to revise its call from earlier in the year, which estimated a large erosion in the price of lithium by FY23.

Also, four out of four brokers rate Lake shares a buy right now, with a consensus price target of $2.56, according to Refinitiv Eikon data.

Despite its recent volatility, the Lake Resources share price is still up 109% for the past 12 months.

Returns for this time frame are seen below alongside the materials index.

The post Why is the Lake Resources share price heading 5% upstream today? appeared first on The Motley Fool Australia.

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• Why is the Lake Resources share price having such a stellar Monday?
• These are the 10 most shorted ASX shares
• Why did the Lake Resources share price rocket 40% in August?
• These were the best performers on the ASX 200 in August
• Here are the top 10 ASX 200 shares today

JPMorgan Chase is an advertising partner of The Ascent, a Motley Fool company. 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. 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.

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The Lynas Rare Earths Ltd (ASX: LYC) share price is climbing from the open on Tuesday.

At the time of writing, shares in the rare earths player are swapping hands for $8.56 apiece, 0.71% higher, following a company announcement after the closing bell yesterday.

The gains reverse course for the Lynas share price which has been heading lower since 17 August. Let’s check the details of the company’s latest news.

What did Lynas announce?

Yesterday, the company advised that it has signed agreements with Japan Australia Rare Earths B.V (JARE).

Lynas notes that JARE is a special purpose company established by Japan Oil, Gas and Metals National Corporation and Sojitz Corporation.

Lynas CEO Amanda Lacaze said the relationship is “significant for the global rare earths industry”.

“We are pleased to have JARE’s continued support, including for our exciting exploration program at Mt Weld,” she added.

The pair are already partnered on a long-term senior loan that pays an interest rate of 2.5% p.a. with the balance currently at US$141 million.

Under the agreement, JARE will provide a contribution of US$9 million to the exploration program at Mt Weld.

It will make the contribution through a US$9 million subscription for ordinary shares in Lynas.

Perhaps most importantly for Lynas shareholders is that restrictive covenants on the abovementioned loan facility will be abolished.

The company said:

JARE has agreed to remove capital management restrictions in the loan facility.

Lynas will no longer be subject to capital restrictions in respect of issuing dividends, share buy backs, capital expenditure or incurring financial liabilities.

Instead, covenants will be dictated by the gross debt-to-equity ratio and backward-looking debt service ratios.

Considering the bulky mining profits that have been on offer these past two years, and the potential for rare earths in Australia looking ahead, this opens the gates for various types of investors to gain exposure to the share.

In the last 12 months, the Lynas share price has climbed more than 23%.

The post Why is the Lynas share price surging higher on Tuesday? appeared first on The Motley Fool Australia.

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• Should investors ‘buy the dip’ in Lynas shares right now?
• Guess which ASX rare earths share is rocketing 13% on a ‘resounding success’. Hint: not Lynas
• Down 24% since April, have investors fallen out of love with Lynas shares?
• Top ASX shares to buy in September 2022
• 5 ASX shares that could rocket from a rare earths crisis: expert

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.

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Commonwealth Bank of Australia (ASX: CBA) shares have slipped 5.6% since the opening bell on 4 May.

The S&P/ASX 200 Index (ASX: XJO) has fared slightly worse, down 6.3% in that same time.

So why are we choosing 4 May as our starting date?

RBA breaks 10-year easing streak

Because that’s the date the Reserve Bank of Australia (RBA) bumped interest rates from the historic low 0.1% to 0.25%.

Somewhat astoundingly, that marked the first rate increase from the RBA since November 2010. At that time, the central bank raised the official cash rate by 0.25% to 4.75%, where it would remain for most of 2011.

With inflation roaring back in 2022, the RBA has raised rates now for four consecutive months. Last month’s 0.5% hike brought the official cash rate to 1.85%. And analysts are widely predicting another 0.5% rise today, which would bring the rate to 2.35%.

Though with central banker’s penchant for round numbers, I expect a 0.65% hike (bringing the rate to 2.5%) isn’t out of the question.

Regardless of the size of today’s increase, CBA is warning that the RBA could be raising rates too aggressively and not bearing in mind the lag period between raising rates and higher mortgage repayments.

CBA cautions on lagging impact of rate hikes

According to CBA’s head of Australian economics Gareth Aird (courtesy of ABC News):

Interest accrues from a lender’s effective rate change date, which is typically about two weeks after the RBA increases the cash rate. This interest is added to a borrower’s outstanding debt. But from a cash flow perspective the impact is not felt for three months on average for a CBA customer.

This means that the bulk of our borrowers have only felt the impact of one 25-basis-point hike on their cash flow, or potentially, as of this week, the cumulative impact of the May 25-basis-point rate hike and June 50-basis-point rate increase.

Noting the risks to the wider Aussie economy of overshooting the size and pace of rate hikes, Aird added:

It has simply been too early for the spending data to pick up the impact of the already delivered rate hikes. There is a clear risk that the RBA continues to tighten policy aggressively because it appears that demand in the economy is not slowing sufficiently to put the desired downward pressure on inflation.

In due time, Aird said, the impacts of the RBA’s rate increases will kick in. “At CBA, for example, by December the impact of already announced rate rises on monthly cash flow for mortgage holders will be a four-fold increase compared to July.”

Then there are the mortgage holders on fixed loans, where the lagging impact of rate rises is even longer.

“There is a large proportion of fixed rate home loans that will expire over the next 18 months,” Aird said. “This creates natural tightening even with the RBA on hold.”

How have CBA shares been tracking longer-term?

While CBA shares have come under some selling pressure this year, they remain up 31% over the past five years. That compares to a 21% gain posted by the ASX 200.

The post Own CBA shares? Here’s the bank’s warning on rapid RBA rate hikes appeared first on The Motley Fool Australia.

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More reading

• How might falling house prices impact the CBA share price?
• Why ASX bank shares are more likely to slowly grind lower than crash, despite famed Wall Street bear saying it’s time to short them
• Is this why the Macquarie share price was ‘steaming ahead’ on Friday?
• Why did the CBA share price go backwards in August?
• What’s the outlook for ASX 200 bank shares in September?

Motley Fool contributor Bernd Struben 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.

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The Chalice Mining Ltd (ASX: CHN) share price is in the green this morning with the company releasing seismic results that suggest its Gonneville gold project may contain more gold than originally expected.

The gold miner said that its 2D seismic surveys identified the potential plunge extension of the Gonneville Intrusion. The extension ran for around 1.6km northwest of the resource and is circa 500m below the surface.

The news seems to have offset the general gloom hanging over ASX gold shares. The Chalice Mining share price is up 1.57% at the time of writing to $4.52. That’s ahead of the All Ordinaries‘ (ASX: XAO) gain of 0.58% in early morning trade.

Chalice Mining share price climbs

The results highlight significant growth potential for the Gonneville project in Western Australia. Given the sulphide-rich nature of the Gonneville Intrusion, this extension could significantly expand the deposit to this point and, potentially, beyond.

The extension is open to the north. Chalice will soon commence step-out drilling to validate the seismic interpretation.

Drilling results

Meanwhile, the miner added that drilling at the Dampier Target has confirmed “encouraging evidence” of widespread sulphide mineralisation. Chalice believes this indicates a fertile mineral system that’s around 10km north of Gonneville.

The drilling found 9.6m @ 0.2g/t 3E (gold, palladium and platinum). It also found 0.2% copper, 0.03% Co (~0.7% NIEq – nickel equivalent) from 203m.

Further, the drill results contained 41.6m @ 0.5g/t 3E, 0.1% Ni, 0.1% Cu, 0.01% Co (~0.4% NiEq) from 63m.

There are another 27 sites that are yet to be drilled across the ~10km Hartog-Dampier strike length. Chalice is also looking at the financial viability of a smaller “starter mine” as an initial first phase of the project.

Gold losing its lustre

The Chalice Mining share price is climbing in early trading on Tuesday, perhaps also boosted also by a 1% increase in the gold price.

The price of the yellow metal is inching up after falling below US$1,700 an ounce last week. The price of the commodity is making a small recovery as breakeven bond yields fell. The breakeven is the difference between nominal US government bonds and inflation-adjusted bonds.

But investors may be worried that the rebound won’t last given how hawkish the US Federal Reserve (and other central bankers) are.

This probably explains why the Northern Star Resources Ltd (ASX: NST) share price is down 0.87% and the Evolution Mining Ltd (ASX: EVN) share price is steady at the time of writing.

Chalice Mining share price snapshot

Gold has been out of favour as interest rates around the world rise. This is because gold doesn’t pay a dividend, unlike bonds. The higher the yield on bonds, the less attractive holding gold is.

The Chalice Mining share price lost more than 32% in the last 12 months. But at least it is in good company. The Northern Star and Evolution Mining share prices are down more than 25% and 44%, respectively, over the period.

The post Chalice Mining share price lifts on positive exploration results today appeared first on The Motley Fool Australia.

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More reading

• Here are the top 10 ASX 200 shares today
• Here are the top 10 ASX 200 shares today
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• Why has the Chalice Mining share price dived 13% in the past week?
• Why has the Chalice Mining share price rocketed 33% in a month?

Motley Fool contributor Brendon Lau 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.

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This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

Every crypto investor has probably heard by now that the Merge will be the single most important event in crypto history. It will transform Ethereum (CRYPTO: ETH) from a proof-of-work blockchain into a proof-of-stake blockchain, ushering in a new era of ultrascalability, lower transaction fees, incredible energy efficiency, and higher throughput capacity. This, in turn, will bolster the number of use cases for Ethereum and guarantee its place as the most important blockchain in the world. 

That has been the primary investment thesis for buying Ethereum this entire summer. However, as we get closer to the expected date of the Merge, it’s worth taking a closer look at some of the key factors that might affect the price of Ethereum. Take a quick look at the chart for Ethereum. After hitting a summertime high of $1,984.72 on Aug. 13, Ethereum actually trended down over the final two weeks of the month, and it now trades around $1,550. That has me thinking that we could already be seeing some profit-taking in Ethereum, and the narrative around the Merge could already be shifting.

‘Buy the rumor, sell the news’

Maybe, just maybe, the hype has already been priced into the Merge. There has been so much speculation this summer about why the Merge is going to be wonderful both for Ethereum and crypto that many investors now assume the case for buying Ethereum is ironclad. 

But step back for a moment and consider that even Vitalik Buterin, the co-founder of Ethereum, now says the Merge will only be “55% complete” this year. There are still four more parts to the process — the so-called Surge, Verge, Purge, and Splurge. So maybe we’re celebrating a bit too early. Some of the earliest predictions about the Merge — for example, that it will enable Ethereum to handle 100,000 transactions per second — may turn out to be hopelessly optimistic. People are also starting to question whether the Merge will actually have any real impact on crypto gas fees, the transaction fees on the Ethereum blockchain.

We could be seeing a classic case of “buy the rumor, sell the news.” In other words, buy Ethereum up to the expected date of the Merge, then sell when the Merge actually takes place. Let’s face it — investors are going to be spooked by any bit of bad news about the Merge. The complexity of the Merge cannot be overstated: Some have compared it to changing the engine of an airplane mid-flight. If there are passengers aboard, there is bound to be a certain amount of anxiety.

Jerome Powell vs. Vitalik Buterin

Moreover, all the enthusiasm surrounding the Merge has to be taken within the context of what is currently happening with the U.S. Federal Reserve. Any negative sentiment about inflation coming out of the Fed these days is bad for crypto. Consider what has happened to the sentiment around Bitcoin (CRYPTO: BTC) and other cryptos ever since the Jackson Hole speech by Fed Chairman Jerome Powell on Aug. 26.

This new investor focus on the Fed could mean that any positive sentiment surrounding Ethereum — no matter how successful the Merge turns out to be — is going to be far outweighed by all the negative sentiment surrounding inflation, interest rates, and the prospect of more Fed tightening. The next meeting of the Federal Open Market Committee (FOMC) will take place on Sept. 20, which is almost exactly when the Merge is scheduled to be completed.

Be prepared for a change of narrative

Opinions about the Merge are much more varied than you might think within the crypto community. People are starting to realize that there are a number of trade-offs involved with any technological upgrade, and that the Merge is no different. Moreover, it’s not exactly the case that all crypto enthusiasts are united in their support of the Merge. As long as the price of Ethereum is going up, they are going to support the Merge, of course. But what happens if the price doesn’t go up? So be prepared for a change of narrative around Ethereum if there are any problems with the upgrade.

The Ethereum Merge will start on Sept. 6, which is almost exactly when relaxed, suntanned investors will be returning from their Labor Day vacations. This is when the real fun starts, because nobody knows the exact date and time of the Merge. It could take place anytime between Sept. 10 and Sept. 20. If people get too nervous, the same people who told you to “buy the dip” might tell you to “sell the rip.” Don’t say you weren’t warned.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

The post Will Ethereum still be a buy after the merge? appeared first on The Motley Fool Australia.

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More reading

• September could be a crucial month for these 2 cryptocurrencies
• Ethereum Merge first stage set for tomorrow. What can crypto investors expect next?
• Why Ethereum, Dogecoin, and Solana lost altitude on Thursday
• Why the Ethereum price slipped but still outperformed Bitcoin in August
• Why Ethereum and other cryptos jumped Wednesday

Dominic Basulto has positions in Bitcoin and Ethereum. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Ethereum. 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.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

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