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S&P/ASX 200 Index (ASX: XJO) tech shares have caught a bid on Thursday as risk sentiment shifts between various asset classes following US inflation data overnight.

Consumer prices for the month of July remained largely unchanged from the previous month, thanks to a wind back in gasoline prices.

Following the update, ASX shares have advanced today, prompting high growth and technology stocks to rally the most.

Both the S&P/ASX 200 Information Technology Index (ASX: XIJ) and the S&P/ASX All Technology Index (ASX: XTX) are leading sectors in the session, with the latter today’s top gainer.

However, global inflation is still at multi-decade highs, and the US still recorded an 8.5% year on year gain in the consumer price index (CPI) for July.

Why the shift in tone from investors then?

Whilst the raw data is still concerning, it appears as if investors are optimistic about what the flat CPI print means for the future of risk-assets like stocks.

As Randy Frederick, VP of trading and derivatives at Charles Schwab said in a note from yesterday, “8.5% if still very high, but there is optimism that perhaps June was the peak”.

Perhaps more importantly, is what a reduction in headline inflation actually means for the real economy, and for us as investors.

If we just rewind for a second – central banks are the ones typically tasked with curbing inflation. One of the Reserve Bank of Australia (RBA)’s core functions, for instance, is to maintain inflation within a level of 2–3%.

However, central banks also have no direct influence on productivity, output, or things like business efficiency for instance – all factors that impact price stability.

Instead, they use monetary policy, that is, setting key policy interest rates to influence the level of aggregate demand and supply within the economy.

Put simply, using Australia as an example, if inflation begins to rise beyond 2-3%, the RBA will lift its key interest rates.

This is called monetary tightening, and the interest rate in question is called the ‘cash rate’ in Australia.

This ideally results in a pullback to flows of credit and money, whilst also influencing the cost of capital investment. Beauty, inflation sorted! (although, and of course, it’s not so simple). Alas, the RBA has done this several times in the past with success.

As such, and in reality, these moves from central banks have reigned in soaring global inflation on numerous occasions over the past 100 years.

There does exist, a key tradeoff, however.

With each increase in base interest rates, the probability of the country entering into an economic recession increases as well.

That’s because, typically, in order to wind back surging producer and consumer prices, market forces must also be willing to accept this.

By lifting base interest rates, central banks also increase the cost of obtaining credit (business financing, overdrafts, etc.) and the cost of servicing existing debt, leaving less free cash flow available for discretionary purposes or business expansion, ultimately reducing the level of economic activity.

So with rising inflation also comes the prospect of rising interest rates that spell trouble for the real economy in terms of GDP and economic growth.

Therefore, investors see a potential cooling inflation as a signal that central banks may be less aggressive in their tightening regimes, thereby reducing the chance (or severity) of potential economic recession.

It might seem farfetched, but it is completely logical for sophisticated investors and money managers to position for ‘where the puck is going’, not where it came from. We don’t get paid from the past, or from what’s already happened, that’s for sure.

Mike Owens, trader at Saxo Markets, agreed in a note from yesterday. “The sign of slowing in the rate of inflation offers hope the Fed’s rate increases won’t need to go as far as previously thought,” he said.

This is what’s happened overnight, and the yields on US Treasury notes – often served as a proxy for risk sentiment – also receded.

As such, technology shares, whose valuations are sensitive to changes in Treasury yields, have advanced in today’s session as the US 10-year yield contracted sharply overnight.

The strength has continued into the Australian session and the result has been an uptick in ASX 200 tech shares.

The upside has been especially generous to beaten down tech names such as Block Inc (ASX: SQ2), Wisetech Global Ltd (ASX: WTC) and Xero Limited (ASX: XRO), who’ve each secured a bid today.

As to how far this turnaround-tech-rally can last, only the market will decide, and it’s been anyone’s guess as to what direction it will head next this year.

The post Why are ASX 200 tech shares flying higher on Thursday? appeared first on The Motley Fool Australia.

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More reading

• Why has the Block share price exploded 9% on the ASX today?
• What’s going so wrong for ASX 200 tech shares on Wednesday?
• Here are the top 10 ASX 200 shares today
• Why Block, CBA, Mesoblast, and NAB shares are dropping today
• ‘Capital light and scalable’: Expert picks 2 ASX shares to buy now while CHEAP

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 Block, Inc., WiseTech Global, and Xero. The Motley Fool Australia has positions in and has recommended Block, Inc., WiseTech Global, and Xero. 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 price of lithium carbonate remains top-heavy in FY23 while various commodity baskets have either cooled off or pared their 2022 gains completely.

With the demand for electric vehicles (EVs) continuing to stretch higher, so too is the demand for battery metals such as lithium and its derivatives.

With that, these two ASX lithium shares have booked double-digit gains today following new discoveries.

Ragusa Minerals Ltd (ASX: RAS)

Ragusa advised today it has completed the initial desktop review of previous works conducted at its NT Lithium Project and compiled all results received to date.

A portion of these historical works identified numerous high-grade lithium samples. As such, the results have identified “numerous priority drill targets”, Ragusa says.

Chairman Jerko Zuvela said the discovery will help Ragusa “rapidly accelerate the development” of the project.

“We have a significant opportunity to utilise our exploration and development experience to … realise the massive upside value potential in a Tier 1 jurisdiction close to major infrastructure at a time of record lithium prices,” he added.

This ASX lithium share is up 50% today to 15 cents apiece.

Lithium Plus Minerals Ltd (ASX: LPM)

Lithium Plus Minerals also provided test results from its maiden Phase 1 diamond drilling program at the Lei Prospect, located at the Bynoe Project.

The company says it intersected a thick downhole interval of 43 metres of pegmatite from 191.9 metres. This extends previously discovered pegmatites at the location.

Core samples have been sent to the company’s logging facility in Darwin and will undergo more detailed logging and sampling.

The first drill hole is the first of a potential 9-hole 2-phase diamond drilling program at Lei, targeting 1,800 metres in depth.

Lithium Plus says the second Phase 1 diamond hole is currently underway.

Speaking on the results, the executive chairman, Dr Bin Guo, said the company is “pleased with the samples”.

“[O]ur maiden diamond hole at the Lei Prospect, which have visibly validated the historical spodumene-bearing pegmatite system at Depth, [now] provide us confidence that we may have a significant lithium discovery at Bynoe,” he added.

Lithium Plus shares are up 14% today. They have risen by 176% since listing in April of this year. The ASX lithium share now trades at 69 cents apiece.

The post Here are 2 ASX lithium shares surging on new discoveries appeared first on The Motley Fool Australia.

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More reading

• Guess which ASX mining share is rocketing 55% on a new lithium find

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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The Province Resources Ltd (ASX: PRL) share price won’t be going anywhere on Thursday after the company requested its shares be placed in a trading halt.

The minerals producer’s stock has been one of the best performers on the market recently, rising 80% in the past month.

Currently, the share price is frozen at 14.5 cents apiece – roughly an eight-month high for the company.

Why are Province Resources shares halted?

Prior to the market opening today, management requested the Province Resources share price be halted while it prepares an announcement.

According to the release, Province Resources is finalising the terms of its Joint Development Agreement with Total Eren for the HyEnergy Project.

The company has requested that the trading halt remains in place until those terms are finalised.

Should no announcement come before next Monday, Province Resources shares will resume trading on the ASX.

More on the HyEnergy Project

Led by Province Resources, the HyEnergy Project is aiming to generate 550,000 tonnes annually of green hydrogen.

The renewable green hydrogen project is located in Western Australia’s Gascoyne Region.

Currently in the detailed planning stage, it is proposed the HyEnergy Project be built in two stages. This includes using a mix of wind turbines and a solar farm.

Province Resources share price snapshot

Over the past 12 months, the Province Resources share price has remained relatively flat despite surging in recent times. It is down 3.3% over the past year and up 3.6% so far in 2022.

Its shares hit a 52-week low of 5 cents in June before moving upstream in the following weeks.

Trading volumes have also largely increased as investor hype ramps up around the company’s prospects.

Based on valuation grounds, Province Resources commands a market capitalisation of roughly $171.14 million.

The post Up 80% in a month, why is the Province Resources share price on ice today? appeared first on The Motley Fool Australia.

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More reading

• Why has the Block share price exploded 9% on the ASX today?
• Why is the Novonix share price leaping 11% on Thursday?
• Why is the Vulcan Energy share price up 8%?
• QBE share price lifts despite $840 million income hit
• Up 90% in 2 weeks, here’s why the Paradigm share price has been halted

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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The S&P/ASX 200 Index (ASX: XJO) is having a pretty decent run so far this Thursday. At the time of writing, the ASX 200 is up a healthy 0.87%. But that’s nothing compared to the Block Inc (ASX: SQ2) share price.

Block shares are on fire today. This ASX 200 tech share is currently up a pleasing 8.89% at $126.93 share.

So, what’s going on with Block, the US fintech company that is the owner of Afterpay?

Well, let’s get one thing straight. This share price boost doesn’t seem to have anything to do with the company itself. Block, which was formerly known as Square, has not released any significant ASX announcements today. Or indeed since the company dropped its quarterly report back on 5 August.

But we are seeing similar moves among many other ASX 200 tech shares this Thursday.

Life360 Inc (ASX: 360) shares have risen more than 9% so far today. Zip Co Ltd (ASX: ZIP) is up more than 5%, as is REA Group Limited (ASX: REA).

Why is the Block share price on fire today?

It’s more likely that Block’s stellar performance today comes down to the performance of its US-listed sister stock. See, Block’s ASX listing is actually a CDI (CHESS Depositary Interest).

This means it is essentially a vehicle that really represents an investment in an underlying company. In this case, that underlying company is Block’s primary US listing of Block Inc (NYSE: SQ).

One SQ2 share on the ASX is essentially one SQ share on the US markets, just priced in Australian dollars. Hence, these two investments usually trade in tandem, taking into account currency fluctuations, of course.

So, in last night’s trading, Block’s US-listed shares rose an impressive 9.54% to US$88.84 each.

Thus, it’s no coincidence that the ASX-listed Block shares are rising by a similar amount on our markets today. This is probably why we are seeing such a strong move with Block.

Even so, Block shares remain down more than 28% since they first listed on the ASX back in January.

At the current Block share price, this ASX 200 tech share has a market capitalisation of $64.41 billion.

The post Why has the Block share price exploded 9% on the ASX today? appeared first on The Motley Fool Australia.

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More reading

• Here’s why the BetaShares Nasdaq 100 ETF (NDQ) is outperforming the ASX today
• 3 rising ASX shares to buy that have passed the bottom: expert
• 5 things to watch on the ASX 200 on Thursday
• 3 ASX All Ordinaries shares rocking new 52-week highs on Wednesday
• Does this signify more bad news for ASX BNPL shares like Zip?

Motley Fool contributor Sebastian Bowen has positions in Block, Inc. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Block, Inc., Life360, Inc., and ZIPCOLTD FPO. The Motley Fool Australia has positions in and has recommended Block, Inc. The Motley Fool Australia has recommended REA Group 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 Novonix Ltd (ASX: NVX) share price is leaping upwards today, gaining back its Wednesday losses and then some to mark its highest point in nine weeks.

That’s despite no word having been released by the company since late last month.

Right now, the Novonix share price $3.27, 10.85% higher than its previous close.

For comparison, S&P/ASX 200 Index (ASX: XJO) has lifted 0.87% so far today while the company’s home sector – the S&P/ASX 200 Information Technology Index (ASX: XIJ) – is up 1.28%.

Let’s take a closer look at what might be driving the battery materials and technology share higher on Thursday.

What’s going right for the Novonix share price today?

The Novonix share price is taking off today despite the company’s silence. However, it’s far from alone in its gains.

Many ASX 200 tech shares are following the stock’s lead and rocketing higher today.

The Novonix share price is its sector’s top performer, with that of Life360 Inc (ASX: 360) not far behind having gained 9.68%.

Meanwhile, shares in Block Inc (ASX: SQ2) and Megaport Ltd (ASX: MP1) are up 8.80% and 5.02% respectively.

Their gains follow a strong session overnight on the tech-heavy Nasdaq Composite Index (NASDAQ: .IXIC) that saw the index lift 2.9%. That came amid news that US inflation slowed in July, likely bolstering hopes the Federal Reserve might ease up on rate hikes, as Reuters reports.

On the other end of the market, shares involved in battery metals are leading the S&P/ASX 200 Materials Index (ASX: XMJ). Their strong performance might be rubbing off on the battery-focused tech stock.

It comes amid reports that China saw its best month yet for electric vehicle (EV) sales in June. More than 570,000 EVs went to new homes in the nation over the course of the month, as my Fool colleague Bernd reports.

Still, the Novonix share price’s Thursday rise hasn’t been enough to boost it back into the longer-term green.

Shares in the company have fallen nearly 64% since the start of 2022. It’s also 17% lower than it was this time last year.

The post Why is the Novonix share price leaping 11% on Thursday? appeared first on The Motley Fool Australia.

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More reading

• Why is the Novonix share price having such a lousy start to the week?
• These 3 ASX tech shares had a cracking day on the ASX today
• Here are the top 10 ASX 200 shares today
• Why is the Novonix share price leaping 12% on Friday?
• Here are the top 10 ASX 200 shares today

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 positions in and has recommended Block, Inc., Life360, Inc., and MEGAPORT FPO. The Motley Fool Australia has positions in and has recommended Block, Inc. The Motley Fool Australia has recommended MEGAPORT FPO. 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 Vulcan Energy Resources Ltd (ASX: VUL) share price is streaking higher today as ASX lithium shares ride a new wave of momentum in August.

At the time of writing, the Vulcan share price is up 8.21% to $9.62. In earlier trading, it reached $9.88 — an 11.1% gain on the closing price yesterday of $8.89.

There’s been no price-sensitive news from Vulcan since its quarterly activities and cash flow reports were released on 28 July.

But everything is positive on the lithium front, with several developments giving investors renewed confidence in the sector this month. And Vulcan is among many ASX shares benefitting from that.

Let’s take a look.

What’s going on with ASX lithium shares?

Well, in short, they’re having a scorcher of a day.

Let’s survey what’s happening with the big names. At the time of writing:

• The Lake Resources NL (ASX: LKE) share price is soaring 17.8%
• The Sayona Mining Ltd (ASX: SYA) share price is charging 10.4%
• The Core Lithium Ltd (ASX: CXO) share price is rising 4.8%
• The Allkem Ltd (ASX: AKE) share price is ascending 2.4%
• The Pilbara Minerals Ltd (ASX: PLS) share price is climbing 5.0%.

What’s spurring this share price growth?

A bunch of things. Let’s start with the latest news pertaining to lithium.

As my Fool colleague Bernd wrote this morning, China has reported record electric vehicle (EV) sales in June and is forecasting 84% growth for the 2022 calendar year.

The latest figures from the China Passenger Car Association (CPCA), as reported by Technode, revealed there were 571,000 EV sales in June, up 141% year over year.

For the full calendar year, CPCA is forecasting 5.5 million EV sales. That’s about a million more than the rest of the world’s EV markets combined.

Of course, lithium is a key ingredient in the batteries powering EVs. So, news like this is going to move ASX lithium share prices. But wait, there’s more.

This week the United States Senate passed a huge spending bill. By huge, we’re talking an eye-watering US$437 billion. But what’s significant is that almost 80% of it is earmarked for climate and energy spending. This includes dumping per-manufacturer limits for the US$7,500 tax credit for new EVs.

News like this supports ASX lithium shares because it’s a big demonstration of climate change action.

This action is allowing emerging sectors such as lithium to grow rapidly.

Vulcan share price snapshot

Over the past 12 months, the Vulcan share price has decreased by 37%. But over the past five years, it’s up — wait for it — 4,272%. No kidding.

Vulcan hopes to become a producer of high-purity lithium hydroxide for European EV manufacturers. Its Zero Carbon Lithium Project aims to produce both renewable geothermal energy and lithium hydroxide from the same deep brine source in the Upper Rhine Valley in Germany.

EV pioneer Elon Musk recently described lithium processing as “a licence to print money” at “software margins”.

The post Why is the Vulcan Energy share price up 8%? appeared first on The Motley Fool Australia.

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More reading

• Why did the Vulcan Energy share price fire 5% higher today?
• Lithium alert: Broker says Vulcan share price could rise by 170%
• Charging up: Vulcan share price lifts 3% as cash balance surges
• Why Myer, South32, Vulcan, and Zip shares are racing higher
• Why is the Vulcan share price charging higher today?

Motley Fool contributor Bronwyn Allen has positions in Allkem Limited. 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 QBE Insurance Group Ltd (ASX: QBE) share price is in the green today, up 3.7% despite reporting mixed half-year results for HY22. At the time of writing, the insurance giant is trading at $12.60.

The company’s biggest hit came from its investment income amid changes to the risk-free rate that caused large unrealised losses for bond yields.

In other parts of its investment portfolio, unfavourable credit spreads and unrealised losses on equities contributed to its contraction in investment income.

However, the ASX finance share also reported top-line premium growth of 13.78% and a lower combined operating ratio (COR) of 0.42%, suggesting it received more in premiums than it paid in claims from the prior period.

What did QBE report?

• Gross written premiums up 13.78% from HY21 to 11.6 billion
• COR down 0.42% from HY21 to 92.9
• Net profit after tax (NPAT) down 65.75% from HY21 to 151 million
• Net investment income drops 1548.27% to a negative 840 million, down from $58 million
• Adjusted cash return on equity slips to 4.3%, down from 11.9% in HY21

The insurer reported an $840 million loss in investment income for HY22, but excluding the risk-free rate, came in positive at $14 million.

Net profit contracted due to several headwinds, the company said.. These included the impact on its investment portfolio and the reinsuring of North America excess and surplus (E&S) lines.

Despite facing headwinds for its bottom line, QBE Insurance improved its COR, which was helped by an 18% growth of its gross written premiums from 2021.

What else happened in HY22?

QBE reported the highest premium growth in its international operating segment outside of North America and Australia Pacific, growing 18.5%. Results were buoyed by lower catastrophe costs, which helped reduce the impact of war in Ukraine and positive operating leverage.

QBE also mentioned the issue of inflation in its report. It cited that the cost of claim payments was not perfectly correlated with inflation, meaning that QBE believed other factors besides inflation were affecting the cost of its claim payments.

What did management say?

Commenting on the results, QBE Insurance CEO Andrew Horton said: 

Launched in February 2022, we have made pleasing progress against our new strategic priorities. Over the half, we placed significant focus on our North America operations. 

We have materially simplified the business and I am confident we have the right strategy and team in place to drive a sustained improvement in performance.

What’s next?

For the rest of this year, gross written premiums (GWPs) are expected to rise at roughly 10%. The company noted in its outlook that the market could support organic growth with a moderate premium rate increase.

The company also expects to beat the COR of -94% it finished on in FY21.

Over the next 12 months, QBE Insurance will undergo a re-risking process for its investments. The exit total investment return is on track for a -2.8% contraction.

QBE share price snapshot

The QBE share price is up 9.12% over the past 12 months. Shares in the company are beating the S&P/ASX 200 Financials Index (ASX: XFJ) by a convincing margin, as it is currently down 6.27% for the same period.
QBE Insurance’s market capitalisation is $18.6 billion at the latest share price action.

The post QBE share price lifts despite $840 million income hit appeared first on The Motley Fool Australia.

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• Brokers name 2 top ASX dividend shares to buy
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• 2 quality ASX dividend shares rated as buys by brokers
• 5 ASX 300 shares this fundie has been buying at bargain prices
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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 Paradigm Biopharmaceuticals Ltd (ASX: PAR) share price is going nowhere today after the company requested a trading halt. 

The Paradigm share price has rocketed from $1.05 per share on 28 July to $1.99 per share at Wednesday’s close, a gain of 89.5%. 

Across this timeframe, the ASX-listed biopharmaceutical company released its quarterly results for the three months ended 30 June 2022 and announced the results of a major research project.

Before market open this morning, it entered a trading halt pending an announcement relating to a capital raising.

Let’s dive deeper to get up to speed with what’s happening at Paradigm. 

Why is Paradigm in a trading halt?

The Paradigm share price has been frozen today after the company requested a trading halt in relation to a capital raising.

It will remain halted until the start of normal trading on Monday or when the announcement is released to the market, whichever comes first.

The company burned $32 million of cash for FY22 and the cash balance at 31 December 2021 was nearly $55 million. It seems Paradigm wants to solidify its capital base to progress the research initiatives outlined below. 

In its last announcement on Monday, Paradigm reported it will be presenting the results of its drug development to treat the metabolic disease mucopolysaccharidoses (MPS) type I in February next year. 

Paradigm’s long-term goal is to develop an injectable form of pentosan polysulfate sodium (PPS) to treat MPS. Historically, PPS has primarily been used to assist with bladder pain.

In addition, Paradigm is researching the use of PPS for a range of other clinical uses, such as treating pain in patients suffering from musculoskeletal disorders. 

Paradigm share price snapshot

The Paradigm share price is up 45% in the last six months and 87% over the past month. It has also gained 4% this year to date.

In contrast, the S&P/ASX 200 Index (ASX: XJO) has declined by 2% across the last six months and 7% year to date, but is up almost 7% in the past month.

The recent rapid rally in the Paradigm share price has been spurred by some positive developments. However, investors should be aware that Paradigm’s net loss has been on a downward trend from FY17 to FY21.

The recent momentum has driven Paradigm’s market capitalisation to around $450 million.

The post Up 90% in 2 weeks, here’s why the Paradigm share price has been halted appeared first on The Motley Fool Australia.

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Motley Fool contributor Raymond Jang 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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1) US inflation slowed from 9.1% in June to 8.5% in July, a print that was lower than expected.

Cue a big rally in US markets as investors looked ahead to a moderation of the Federal Reserve’s interest rate rises as it attempts to get inflation back under control.

The Nasdaq 100 jumped 2.9%, simultaneously exiting bear market territory and entering a bull market, having risen 20% above its June lows. The index is still 19% below its November 2021 high.

No wonder I’m feeling better about my investments than I was just a few weeks ago. 

And there could be more gains ahead as hedge funds unwind shorts, funds which fled to cash rush to get back into the rising market, and retail investors buy the dip.

As Bloomberg puts it…

“Nobody saw it coming, and now everyone wants in. That’s a nutshell synopsis of how an improbable equity market bounce is threatening to become a melt up.”

2) The S&P/ASX 200 Index (ASX: XJO) has taken somewhat of a lead from Wall Street, although not to the same extent, up a somewhat modest 54 points to 7046 in lunchtime Thursday trade.

No melt up here, sadly, although that shouldn’t be expected given the ASX 200 is dominated by huge banks and mining companies. 

3) Long-suffering Telstra (ASX: TLS) shareholders finally have something to cheer about… the first increase in the total Telstra dividend since 2015.

Outgoing CEO Andy Penn said the increased dividend “recognises the confidence of the Board following the success of our T22 strategy, the ambition in our T25 strategy of high-teens earnings per share (EPS) growth from FY21 – FY25, the strength of our balance sheet and the recognition by the Board of the importance of the dividend to shareholders.”

Given the Telstra share price is largely flat over the past almost 20 years, any investment in the company has long been about the fully franked dividend. 

Despite Mr Penn’s ambitions of turning Telstra into a growth company, it remains a large utility company operating mostly in two very competitive environments – mobile and broadband. From an investing perspective, utility companies are yield plays.

Based on the full year dividend of 16.5 cents, Telstra shares trade on a fully franked dividend yield of 4.1%. Not bad, but in this rising interest rate environment, not as attractive when compared to alternatives, including risk free term deposits. 

Valuation-wise, Telstra shares are off the charts, trading on 28 times earnings. They are anything but risk-free.

4) One dividend stock flying under the radar is one I own, GQG Partners (ASX: GQG), the boutique global investment manager headquartered in the United States.

In what has been a tough period for the sector – hurt by outflows and poor investment performance – funds under management have increased by 2.4% from the previous year. 

Floated in October last year at $2 per share, like most recent IPOs, the GQG share price has traded below its issue price.

Like all fund managers, GQG’s results will largely be driven by its investment performance over the long term, and all strategies are ahead of their benchmarks over a five year period. 

Unlike many fund managers, most of GQG’s revenues in the first half were derived from management fees, and not performance fees. As such, profits are far less volatile than typical fund managers like Magellan Financial Group (ASX: MFG) and Pinnacle Investment Management (ASX: PNI). I also own the latter.

Given GQG’s relatively predictable results, if you extrapolate the roughly US$0.02 quarterly dividend across the full year, converted to Aussie dollars, GQG shares trade on a dividend yield of around 7.1%.

Not bad for a growing company trading on roughly 13 times profit. This $4.7 billion company looks to be flying under the radar of most income investors.

The post Equity markets threaten to “melt up” as Nasdaq enters bull market territory appeared first on The Motley Fool Australia.

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More reading

• ‘We’ve become the piggy bank’: GQG share price jumps on half-year results
• Everything you need to know about the latest Telstra dividend
• Telstra share price higher on earnings beat and surprise dividend increase
• Telstra share price on watch amid strong FY22 result and surprise dividend increase
• 5 things to watch on the ASX 200 on Thursday

Motley Fool contributor Bruce Jackson has positions in GQG Partners Inc. and PINNACLE FPO. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended PINNACLE FPO. The Motley Fool Australia has positions in and has recommended PINNACLE FPO and Telstra Corporation 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 S&P/ASX 200 Index (ASX: XJO) is performing strongly this Thursday. At the time of writing, the ASX 200 is up a healthy 0.74% at around 7,045 points. But that’s nothing compared to the BetaShares Nasdaq 100 ETF (ASX: NDQ).

NDQ units have had a cracking day so far. This exchange-traded fund (ETF) has lifted an impressive 1.7% to $29.37 a unit at the time of writing.

NDQ is an ASX-listed index fund. It covers no ASX shares though, instead tracking the 100 largest companies on the US NASDAQ-100 (NASDAQ: NDX). The NASDAQ stock exchange is renowned as the major US exchange that holds most of the US’s famous tech shares. Its largest holdings are the likes of Apple, Amazon.com, Microsoft, Tesla and Alphabet.

It also holds a bevvy of other household tech names, including PayPay, Netflix, Starbucks, Adobe and NVIDIA.

So why is the BetaShares NASDAQ 100 ETF having such a strong showing this Thursday?

What’s boosting the BetaShares Nasdaq 100 ETF (NDQ)?

Well, we need not look any further than the performance of the NASDAQ-100 Index itself.

Last night on the US markets, the NASDAQ had an exceptionally strong showing. It gained a healthy 2.85%, rising from 13,008.16 points to 13,378.32 points.

This was supported by moves like Apple rising 2.62%, Microsoft appreciating 2.43% and Amazon and Tesla both gaining more than 3.5%. And with these companies among the NDQ’s top holdings, the gains are flowing into the NDQ ETF today as well.

But why not as much as the NASDAQ’s gains last night? Aren’t NDQ and the NASDAQ-100 essentially the same thing?

Well, yes. But there are other factors at play too. The US NASDAQ-100 Index is obviously priced in US dollars. But NDQ is an ASX-listed ETF priced in Aussie dollars.

And the Aussie dollar has been on the rise over the past few days. This devalued what US companies are worth in Australian dollar terms, and might explain the more tempered movements of NDQ today compared to its underlying index.

But even so, it’s certainly a strong and pleasing showing from this ETF.

Despite today’s gains, the BetaShares Nasdaq 100 ETF has had a rough time in recent months. NDQ units remain down by almost 20% in 2022 thus far, and by just over 10% over the past 12 months. But they also remain up by more than 130% over the past five years.

The BetaShares Nasdaq 100 ETF charges a management fee of 0.48% per annum.

The post Here’s why the BetaShares Nasdaq 100 ETF (NDQ) is outperforming the ASX today appeared first on The Motley Fool Australia.

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• 5 things to watch on the ASX 200 on Thursday
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John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. Motley Fool contributor Sebastian Bowen has positions in Adobe Inc., Alphabet (A shares), Amazon, Apple, Microsoft, Nvidia, Netflix, PayPal, Starbucks, and Tesla. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Adobe Inc., Alphabet (A shares), Alphabet (C shares), Amazon, Apple, BETANASDAQ ETF UNITS, Microsoft, Netflix, Nvidia, PayPal Holdings, Starbucks, and Tesla. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended the following options: long January 2024 $420 calls on Adobe Inc., long March 2023 $120 calls on Apple, short January 2024 $430 calls on Adobe Inc., short March 2023 $130 calls on Apple, and short October 2022 $85 calls on Starbucks. The Motley Fool Australia has positions in and has recommended BETANASDAQ ETF UNITS. The Motley Fool Australia has recommended Adobe Inc., Alphabet (A shares), Alphabet (C shares), Amazon, Apple, Netflix, Nvidia, PayPal Holdings, and Starbucks. 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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