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One of Australia’s leading fund managers has just made a major new investment.

Antipodes Global Investment Company (ASX: APL) has revealed to the Motley Fool Australia that German automotive giant Volkswagen has recently become its top holding.

What does Antipodes like about Volkswagen?

The Chief Investment Officer of Antipodes Partners, Jacob Mitchell, has provided readers with an insight into why the fund is bullish on the future of Volkswagen (VW).

He commented: “VW today is already one of the world’s largest car makers, roughly on a par with Toyota, with a little over 10% of the global market. As the world transitions to EVs [electric vehicles], VW has the opportunity and scale to significantly increase that market share thanks to an all-in approach to electrification, while other legacy automakers have taken a more gradual approach.”

Mr Mitchell believes that the auto giant is well-positioned to grow its market share and become the leader in both the European and Chinese markets.

“Based on currently available data, VW’s share of the EV market in 2025 is likely to be significantly higher than its global market share in 2019 and with the number one position in Europe and China, which are expected to be the two fastest growing EV markets.”

“Market share is critical to the future financial performance of the VW group. Automotive, like any business with a meaningful fixed cost base, is in part a game of scale, something which VW has in abundance,” he added.

EV platform a point of difference

The Chief Investment Officer notes that Volkswagen has a point of difference in its EV platform.

He explained: “And it’s not only VW’s own volumes across all group brands over which they are able to spread the development costs. Other automakers lacking the resources or desire to develop an internal EV platform may choose to partner with VW, e.g. Ford is using VW’s platform for European EV models. New market entrants like tech companies could also add volume and thereby spread costs. It is not inconceivable that VW could become a platform company, though this not our base case.”

Internal battery production

Antipodes notes that Volkswagen has been forward-thinking and is aiming to reduce battery costs significantly in the future.

Mr Mitchell commented: “Management continues to take proactive and forward-looking decisions to protect the company against the changing landscape. In March this year, VW announced plans to internalise future battery production in partnership with its current battery suppliers. This partnership approach is a sensible one, reducing the capital cost to VW while securing supply.”

“Battery cost deflation is a key contributor to the future profitability of EVs. Industry prices today are around $140/kwh but VW is targeting cost reduction of 30% to 50% by the end of the decade which will take battery cost significantly below $100/kwh at which point cost parity between EVs and combustion engine vehicles will likely be achieved,” he added.

Valuation

Other key reasons for its inclusion in the fund are its exposure to the post-COVID-19 economic recovery and its valuation. Mr Mitchell believes the latter is very attractive.

The Chief Investment Officer explained: “VW is well-positioned to benefit from a meaningful post-COVID-19 rebound in economic activity and pent-up demand in the auto cycle, as the multi-year downcycle we’ve seen reverses. The company is also a great way to get exposure to the strong recovery in China given it is the leader in what is the world’s largest auto market. Further, rising bond yields are likely to support relative valuations.”

“At just 8x forward earnings, generating free cash flow of over $10bn p.a. – and that’s post the investment into the electrification offensive – VW can transition to a secular growth winner as it dominates electrification. “

“By 2023 we expect VW’s underlying earnings per share to be at least €35. Applying an undemanding PE multiple of x10 to this points to a fair value of €350 over the coming couple of years, and we see the possibility of upside to both the earnings and the applied multiple,” he concluded.

More reading

• 2 fantastic ASX 50 shares rated as buys
• Why the Oncosil (ASX:OSL) share price finished the day higher today
• New Century Resources (ASX:NCZ) share price climbs on latest results
• Why the NAB (ASX:NAB) share price is at a 52-week high
• JB Hi-Fi (ASX:JBH) share price lower despite new appointment: Time to buy?

Motley Fool contributor James Mickleboro 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 Bruce Jackson.

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The National Australia Bank Ltd. (ASX: NAB) share price had a pretty flat day today. NAB shares have risen 0.03% at the time of writing to $27.24 a share. But zooming out, and the picture looks a whole lot rosier. NAB shares are now up 3.77% over the past month, 18.7% year to date, and 65% over the past 12 months. At the present levels, NAB shares are actually sitting at a new 52-week high. Well, almost. The actual 52-week high was hit yesterday when NBA topped out at $27.30. But at $27.24 today, we can safely say the company is still at its high point for the year.

At this level, NAB is essentially sitting at the same level it was back in February 2020, just before the pandemic struck. That’s a pretty remarkable turnaround if we stop and think about it. In saying that however, we are still nowhere near NAB’s all-time high. NAB was even trading close to $30 a share in the latter half of 2019. And going all the way back to 2015, that’s when we saw this ASX bank at around $37 a share. But NAB’s all-time high? For that fabled event, we have to backtrack all the way to 2007 – just before the onset of the global financial crisis. Back then, NAB shares were seeing highs of $42 a share. That’s still a long way off of where we are today.

But that’s enough history. So why are NAB shares back at their pre-COVID levels today?

Why is the NAB share price at a 52-week high?

Well, it probably comes down to economic growth. NAB, as a bank, is highly tied to the performance of the overall economy. And the economy is doing well, much better than we all thought was possible in fact. Just today, the Reserve Bank of Australia (RBA) held its monthly meeting for May. It revealed that it has upgraded its growth forecasts for the Australian economy, and is now predicting growth of 4.75% this year. That’s ‘gangbusters’ kind of growth, although slightly tempered by the fact that the economy went backwards hard last year.

Also helping is the booming property market. Housing has also been going gangbusters. And higher house prices usually translate into more borrowing, as property investors take advantage of higher leverage opportunities. Especially if you throw in an interest rate that’s pretty much zero (well, 0.1%). More borrowing is of course, great for NAB.

And now we have a recipe for an ASX bank hitting a new 52-week high. At the current NAB share price, the bank has a market capitalisation of $89.9 billion, a price-to-earnings (P/E) ratio of 15.11 and a trailing dividend yield of 2.2%.

More reading

• ASX 200 Weekly Wrap: Shares have average week but a great month
• What to expect from the NAB (ASX:NAB) half year result
• Why ASX bank shares may be facing a big sell-off in the next few weeks
• ASX bank shares best placed to ride the $1bn+ provisioning profit boost this reporting season
• What could APRA’s climate guidance mean for ASX bank shares?

Motley Fool contributor Sebastian Bowen owns shares of National Australia Bank Limited. 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 Bruce Jackson.

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The JB Hi-Fi Limited (ASX: JBH) share price is trading lower on Tuesday despite the announcement of a new senior appointment.

In afternoon trade, the retail giant’s shares are down 0.5% to $45.97.

What did JB Hi-Fi announce?

This afternoon JB Hi-Fi announced the appointment of Biag Capasso as the Managing Director of The Good Guys business.

Mr Capasso will replace Terry Smart in the role when he takes over as JB Hi-Fi Group CEO upon the previously announced departure of Richard Murray in August 2021.

Last month Mr Murray agreed to become the next CEO of the Premier Retail business owned by Premier Investments Limited (ASX: PMV).

According to the release, Biag Capasso has been with The Good Guys since November 2011, holding several roles in the merchandise department. This includes Merchandise Director since May 2018. Prior to this, he was Marketing and Merchandise Manager for Retravision for six years.

The company believes his appointment is a testament to the quality and depth of management within the JB Hi-Fi Group and its succession planning.

Terry Smart commented: “Biag has done an outstanding job as Merchandise Director over the past three years. He has played a key role in the transformation of the business post-acquisition and developed a first-class merchandise buying team. We look forward to Biag taking on his new role and leading the experienced The Good Guys executive team to continue the business’ strong performance.

Is the JB Hi-Fi share price in the buy zone?

One broker that sees a lot of value in the JB Hi-Fi share price is Credit Suisse.

According to a note from last week, the broker has upgraded its shares to an outperform rating with a $57.39 price target. This price target implies potential upside of approximately 25% over the next 12 months.

Credit Suisse believes the market is underestimating the momentum that remains in the household goods market.

More reading

• ASX 200 Weekly Wrap: Shares have average week but a great month
• Retail just changed. Forever…
• Claims of insider trading in JB Hi-Fi (ASX:JBH) shares
• Top brokers name 3 ASX shares to sell today
• Is there still upside to the JB Hi-Fi (ASX:JBH) share price?

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Premier Investments Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The Wide Open Agriculture Ltd (AXS: WOA) share price is shooting higher today following the announcement of its preliminary results.

At the time of writing, the regenerative food and farming company’s shares are fetching for 89 cents, up 4%.

What did Wide Open Agriculture announce?

Investors appear pleased with the company’s latest release, pushing Wide Open Agriculture shares higher.

According to its release, Wide Open Agriculture advised it has received positive preliminary results confirming its lupin protein has applications for multiple food products. Nutritional analyses showed that the production process retained the nutritional quality of the modified lupin protein concentrate. This paves the way for the company to unlock significant commercial potential using lupin protein to create food and beverage products.

The plant-based protein market is estimated to reach US$15.6 billion by 2026. Most notably, the Asia Pacific region is projected to record the highest growth during this period.

Previous barriers for lupin involved undesired texture and capacity for gelling and thickening across the food sector. However, initial laboratory results indicate the right balance of amino acids with low levels of phytoestrogens and high digestibility. This has led to Wide Open Agriculture developing a lupin that has the correct gelling, dispersibility and wettability. In turn, the lupin can be used to make plant-based meat alternatives such as vegetable burgers, high-protein noodles, protein-enriched plant-based milks, and as an egg white replacer.

Wide Open Agriculture revealed that the preliminary results will provide a future framework for further sensory and taste testing. A concept food or drink product using the modified lupin protein is expected to be created.

Once successful, the company hopes to sign a number of supply agreements with established plant-based protein brands. In addition, Wide Open Agriculture will also launch its own lupin protein products under its ‘Dirty Clean Food’ brand.

Wide Open Agriculture CEO, Ben Cole hailed the strong outcome, saying:

The laboratory results are extremely encouraging and provide an excellent foundation to continue rapidly working towards proof-of-concept food and drink products with our patented lupin protein.

Wide Open Agriculture share price summary

Wide Open Agriculture shares have accelerated over the past year to provide investors with returns of 550%. Looking at the share price performance over the month, the company’s shares have jumped close to 30%.

Based on valuation grounds, Wide Open Agriculture presides a market capitalisation of around $82.7 million.

More reading

• JB Hi-Fi (ASX:JBH) share price lower despite new appointment: Time to buy?
• Here are the US shares that ASX investors were buying last week
• Great Boulder (ASX:GBR) share price surges 80%. Here’s why
• a2 Milk and Zip were among the most traded ASX shares last week
• Will May make eight straight months of gains for the ASX 200?

Motley Fool contributor Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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Most weeks, Commonwealth Bank of Australia‘s (ASX: CBA) CommSec platform reveals the US shares that its Aussie customers were buying the previous week.

Since CommSec is one of the most used share brokers in Australia, this information gives us an interesting glimpse into what the average Aussie investor is looking at in the US markets.

So here are the top 10 US shares that investors on CommSec were buying and selling last week. This week’s data covers 26-30 April. 

Blue-chip tech shares dominate most traded US on the ASX

1. Tesla Inc (NASDAQ: TSLA) – representing 6% of total trades with a 77%/23% buy-to-sell ratio.
2. Apple Inc (NASDAQ: AAPL) – representing 2.7% of total trades with a 70%/30% buy-to-sell ratio.
3. Microsoft Corporation (NASDAQ: MSFT)– representing 2.3% of total trades with an 88%/12% buy-to-sell ratio.
4. GameStop Corp. (NYSE: GME) – representing 2.3% of total trades with a 79%/21% buy-to-sell ratio.
5. Amazon.com, Inc. (NASDAQ: AMZN) – representing 1.6% of total trades with a 68%/32% buy-to-sell ratio
6. Coinbase Global Inc (NASDAQ: COIN)
7. Nio Inc – ADR (NYSE: NIO)
8. Alphabet Inc Class C (NASDAQ: GOOG)
9. Microvision Inc (NASDAQ: MVIS)
10. AMC Entertainment Holdings Inc (NYSE: AMC)

What can we learn from these trades?

Well, after a rather homogenous couple of weeks recently, this weeks list looks a little different. What’s not different though is ASX investors love of electric vehicle and battery manufacturer, Tesla. Despite a few months of lacklustre stock performance, 77% of Tesla shares were still on the buy side last week. Tesla still maintains a dominant position in the overall proportion of trades at 6% as well.

ASX investors were also in the mood for blue-chip American shares as well. Smaller growth shares like Coinbase, Nio, and Palantir Technologies Inc (NYSE: PLTR) have made way for Apple, Microsoft, Amazon, and Google-parent Alphabet. This may have stemmed from many of these companies reporting their quarterly earnings last week.

Many of these were extremely well-received by investors too. Most of these companies were also overwhelmingly on the buy side for Aussie investors as well, with the strange exception of Amazon. Around a third of Amazon trades were ‘sells’ last week, despite the e-commerce giant hitting a new all-time high of US$3,554 on Friday. It seems as though there were more than a few people keen to get some profits off the table on that one.

Finally, it’s interesting to note that ASX investor interest in the newly-listed cryptocurrency broker Coinbase appears to be sliding. Last week, it was the second most popular US share with 4.4% of total trades. This week, it managed less than 1.6%.

More reading

• Why Robinhood is having a go at Warren Buffett
• A foldable iPhone is coming from Apple in 2023, analyst says
• Why Alphabet stock jumped 14% last month
• Why Amazon stock gained 12% in April
• Here’s why the NIB (ASX:NHF) share price is on the rise today

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. Teresa Kersten, an employee of LinkedIn, a Microsoft subsidiary, is a member of The Motley Fool’s board of directors. Sebastian Bowen owns shares of Coinbase Global, Inc. and Tesla. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and recommends Alphabet (C shares), Amazon, Apple, Microsoft, NIO Inc., and Tesla. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of Palantir Technologies Inc and recommends the following options: long January 2022 $1920 calls on Amazon, short March 2023 $130 calls on Apple, short January 2022 $1940 calls on Amazon, and long March 2023 $120 calls on Apple. The Motley Fool Australia has recommended Alphabet (C shares), Amazon, and Apple. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The Great Boulder Resources Ltd (ASX: GBR) share price was going gangbusters today before the company entered a trading halt around 30 minutes before market close.

Prior to the pause in trade, shares in the mineral exploration company were trading at 8.3 cents – up an astonishing 80.44%. At one point during intraday trade, shares had more than doubled to a 52-week record of 9.3 cents each.

At the same time, the All Ordinaries Index (ASX: XAO) is currently trading 0.39% higher today. 

The company’s explosive price growth comes after it announced a “large scale gold discovery” at one of its mines in Western Australia.

News of the trading halt “pending a further announcement” related to other drilling results then followed just seven hours later.

Let’s take a closer look at today’s news.

Company profile

Great Boulder Resources is a relatively new mineral exploration company with a primary focus on exploration, discovery and delineation of nickel-copper-cobalt and gold resources within the Eastern Goldfields Region of Western Australia. It holds interest in various projects such as Winchester, Mt Carlon, Tarmoola, Yamarna and Whiteheads.

Great Boulder shares strike gold

In a statement to the ASX, Great Boulder declared its results from initial drilling “at the Blue Poles discovery within the Whiteheads Gold Project” in WA.

According to the company, today’s results confirmed 450m of gold mineralisation strike at the mining project.

The company highlighted the following results:

• A 40m wide ore with 1.15g of gold per tonne.
• A 40m wide ore with 1.03g of gold per tonne.
• A 15m wide ore with 1.02g of gold per tonne.

The Great Boulder share price is not the only one heading higher today after positive gold announcements. Larger gold miner De Grey Mining Ltd (ASX: DEG) saw its shares increase by 11% at one point today following news of a gold strike.

Great Boulder says it will begin testing at The Gunners prospect after today’s results. The company highlighted that The Gunners site is very similar to the Blue Poles prospect where today’s results were found.

Gold commodity price

Gold is currently trading for around US$1,785 per troy ounce on the commodities market. It is down 0.36% today and 5.78% since the beginning of the year. It is, however, 3.38% higher over the last month.

The website Trading Economics attributes the precious metal’s recent rise to “a weaker dollar and lower treasury yields” as well as fears over rising COVID cases in parts of the world. Gold is seen as a safe investment by some investors and thus, would benefit from pessimistic economic indicators, according to the website.

Great Boulder share price snapshot

Over the last 12 months, the Great Boulder share price has increased 165.5%. Of course, most of this has occurred only today. Before today’s astronomical price rise, Great Boulder shares were trading lower when compared to the beginning of the year. At the end of the first trading day of 2021, shares were selling for 4.9 cents each.

Given its current valuation, Great Boulder has a market capitalisation of $21.1 million.

More reading

• Why De Grey, Infomedia, Northern Star, & SEEK shares are storming higher
• ASX 200 up 0.2%: SEEK hits record high, Flight Centre tumbles
• De Grey (ASX:DEG) share price rockets 11% on latest update
• ASX 200 up 0.5%: Coles Q3 update, Westpac settles class action, JB Hi-Fi loses its CEO
• Why the De Grey Mining (ASX:DEG) share price is surging 16% higher

Motley Fool contributor Marc Sidarous 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 Bruce Jackson.

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Australia’s leading investment platform provider CommSec has released data on the most traded ASX shares on its platform from last week.

Here’s the data:

Zip Co Ltd (ASX: Z1P)

Once again, Zip’s shares were the most popular shares among CommSec investors last week. The buy now pay later provider’s shares accounted for 2.2% of trades on the platform, with 63% of the volume coming from buyers. Despite this, the Zip share price tumbled a disappointing 9.4% over the five days.

Kogan.com Ltd (ASX: KGN)

Kogan shares were popular with investors last week and were attributable to 1.8% of trades on the platform. Approximately 72% of these trades came from the buy side, helping to drive the Kogan share price almost 4% higher over the week. Investors were buying the ecommerce company’s shares after the ASX forced it to provide more clarity on its third quarter update.

A2 Milk Company Ltd (ASX: A2M)

This embattled infant formula company’s shares accounted for 1.5% of trades last week, with almost two thirds coming from buyers. Despite this, the a2 Milk share price hit a multi-year low during the week. A broker note suggesting that the company will fall short of its downgraded guidance in FY 2021 appeared to weigh on its shares.

Betashares Nasdaq 100 ETF (ASX: NDQ)

The Betashares Nasdaq 100 ETF was popular with investors yet again. Its units accounted for 1.5% of trades on the platform, with 82% of the volume attributable to buyers. Last week a number of tech giants released their latest updates, which went down well with the market.

Fortescue Metals Group Limited (ASX: FMG)

Fortescue makes the top five after accounting for 1.2% of trades on CommSec, with buyers making up 56% of the volume. Last week the iron ore giant released its third quarter update and revealed that it is on course to achieve its shipments guidance. It also revealed a sharp rise in the price it is commanding for its iron ore. This led to the Fortescue share price rising over 4% during the week.

More reading

• The ASX’s China problem is getting worse… and quickly
• The A2 Milk (ASX:A2M) share price is up 5% in 5 days. Can it go higher?
• Why the Kogan (ASX:KGN) share price was sold off in April
• These are the 10 most shorted shares on the ASX
• A2 Milk (ASX:A2M) share price continues to stink in April

James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of BETANASDAQ ETF UNITS, Kogan.com ltd, and ZIPCOLTD FPO. The Motley Fool Australia owns shares of and has recommended A2 Milk. The Motley Fool Australia has recommended BETANASDAQ ETF UNITS and Kogan.com ltd. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The S&P/ASX 200 Index (ASX: XJO) is edging higher today, up 0.45% in afternoon trading. With a small gain posted by yesterday’s closing bell as well, the ASX 200 is now up 0.64% for the first 2 trading days of May.

If the ASX 200 can maintain its positive trajectory for the month, May will mark 8 straight months of gains for the index.

April saw the ASX 200 finish up 3.5% for the month. That was its best performance since November, when the index gained a stellar 10%.

Now in these days of monster overnight gains — and some rapid losses — from the likes of GameStop Corp. (NYSE: GME) and Bitcoin (CRYPTO: BTC), a 3.5% gain over the month may not grab many headlines.

But remember, we’re talking about the 200 largest listed companies in Australia here. And with the investment philosophy of ‘slow and steady wins the race’ in mind, I’m happy to take a 3.5% monthly gain from the Aussie blue chips populating the ASX 200.

Aussie economy picking up speed

As the Reserve Bank of Australia (RBA) will highlight today, the Australian economy has performed better than government forecasts. Inflation remains low (meaning interest rates will too), unemployment levels are lower than expected, and the budget deficit is looking to come in at some $31 billion less than expected back in December. Though it’s still a doozy!

Along with increased consumer confidence, the rollout of the COVID-19 vaccines and rising house prices, Australia’s financial sector looks to be in far stronger shape than most analysts were predicting as 2020 ground to an end.

And that, along with booming commodity prices, could send the ASX 200 on to another month of gains in May.

Soaring commodity prices help boost ASX 200

The new commodity super cycle you may have read about looks to be well and truly underway.

Prices for metals from iron ore to copper are sitting at all-time or multi-year highs, while crude oil and even coal have come roaring back from their post pandemic lows.

If this continues pace, as many analysts predict, it should continue to offer a welcome tailwind for commodity shares.

And with the materials sector making up some 19% of the ASX 200 (as at 21 December), May could well usher in an 8th consecutive month of gains for the index. 

More reading

• 3 things you need to know about the RBA’s interest rate decision today
• What’s happening with the Dexus (ASX:DXS) share price today?
• ASX 200 up 0.2%: SEEK hits record high, Flight Centre tumbles
• 5 things to watch on the ASX 200 on Tuesday
• ASX 200 flat, Westpac rises after HY21, Premier returns jobkeeper

Motley Fool contributor Bernd Struben 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 Bruce Jackson.

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The Reserve Bank of Australia (RBA) upgraded its growth forecast for our economy even as it held interest rates at record lows today.

The Australia dollar dipped slightly on the news to US77.45 cents while the S&P/ASX 200 Index (Index:^AXJO) held on to its 0.4% gain.

While the decision to keep rates at 0.1% wouldn’t surprise anyone, there are three key takeaways for ASX investors.

RBA upgrades GDP forecast

The first is the upgrade to the Australian gross domestic product (GDP). The central bank upgraded its forecast again and is predicting growth of 4.75% this calendar year. That’s a sizable step up from the 3.5% that it was expecting before.

The RBA may have kept its 2022 GDP forecast unchanged at 3.5%, but remember that comes off the upgraded base, which is now expected to be around $20 billion bigger.

“The economic recovery in Australia has been stronger than expected and is forecast to continue,” said RBA governor Philip Lowe.

“This recovery is especially evident in the strong growth in employment, with the unemployment rate falling further to 5.6 per cent in March and the number of people with a job now exceeding the pre-pandemic level.”

Inflation? What inflation?

The second notable point is how unfazed the RBA is when it comes to the risk of inflation. While global bond markets are starting to price in high inflation due to the amount of monetary stimulus in the system, the RBA noted price pressures remain subdued.

“A pick-up in inflation and wages growth is expected, but it is likely to be only gradual and modest,” said Dr Lowe.

“In the central scenario, inflation in underlying terms is expected to be 1½ per cent in 2021 and 2 per cent in mid 2023.”

In other words, inflation is tipped to stay comfortably below the RBA’s target band. This gives our central bank flexibility in boosting support wherever and whenever it deems necessary.

Cheap bank funding coming to an end

The third takeaway is the expiry of the RBA’s term facility on 30 June this year. The RBA is not considering extending this facility, which allows ASX banks to borrow from the central bank at a 0.1% rate for three years.

I believe the facility enabled banks to offer record low three-year fixed mortgages at around 2%. The banks pick up and easy circa 200 basis point net interest margin for little to no risk.

There are two possible reasons behind the RBA’s move to close down the term facility.

Keeping a watchful eye on the housing market

Firstly, the central bank is taking note of the hot property market.

The RBA is monitoring the trends in housing borrowing and highlighted the importance of maintaining lending standards.

The other is the fact that only half of the $200 billion term loan facility has been used this far. Banks don’t seem keen on borrowing much to lend.

That may be a good thing as it could mean they are also worried about maintaining borrowing standards.

More reading

• What’s happening with the Dexus (ASX:DXS) share price today?
• ASX 200 up 0.2%: SEEK hits record high, Flight Centre tumbles
• 5 things to watch on the ASX 200 on Tuesday
• ASX 200 flat, Westpac rises after HY21, Premier returns jobkeeper
• 2 of the best ASX 200 blue chip shares to buy today

Motley Fool contributor Brendon Lau 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 Bruce Jackson.

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The MGC Pharmaceuticals Ltd (ASX: MXC) share price is having a great day as the company shared news of a $1 million order.

At its intraday high, the MGC Pharmaceuticals share price was 6.7% higher than yesterday’s close, but it’s since retreated.

The company’s share price is trading at 6.1 cents, a 3.39% gain, at the time of writing.

Let’s take a closer look at the latest news from the phytocannabinoid- and plant-focused pharmaceutical company.

Million-dollar baby

MGC Pharmaceuticals’ newest purchase order comes from a European producer and distributor, Swiss PharmaCan AG.

Swiss PharmaCan has ordered around €640,000 ($995,000) worth of the company’s ArtemiC Rescue, a food supplement that contains 4 plant-based ingredients ­– artemisinin, curcumin, boswellia serrata, and vitamin C.

This is its second order for ArtemiC Rescue after the first helped boost MGC Pharmaceuticals’ quarter-on-quarter growth to a record high.

MGC Pharmaceutical says it has the ability to produce commercial-scale batches of ArtemiC Rescue at its Slovenian facility. 

The company has an agreement with Swiss PharmaCan, under which the European company must order at least 40,000 united of ArtemiC Rescue per quarter. The order announced today has seen it meet its quota for the current quarter.

Commentary from management

MGC Pharmaceuticals’ co-founder and managing director Roby Zomer commented on the purchase order, saying:

Receiving a second order on such a large scale from Swiss PharmaCan demonstrates the increasing demand for our product ArtemiC Rescue, and its associated benefits.

Our team in Slovenia has been working tirelessly to ramp up production to ensure rapid deployment of this order, and any subsequent orders that may be received.

MGC Pharmaceuticals share price snapshot

The MGC Pharmaceuticals share price is going gangbusters this year, up 205% year to date with today’s gains included. It’s also up 103% over the last 12 months.

The company has a market capitalisation of around $134 million, with approximately 2.2 billion shares outstanding.

More reading

• Why the MGC Pharma (ASX:MXC) share price has rocketed 9%
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Motley Fool contributor Brooke Cooper 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 Bruce Jackson.

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