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The Afterpay Ltd (ASX: APT) share price performance continues to beat its buy now, pay later competitors. Its shares are within 5% of its previous record all-time high of $105.80 per share.

This compares to the likes of Zip Co Ltd (ASX: Z1P), Sezzle Inc (ASX: SZL), Splitit Ltd (ASX: SPT), Openpay Group Ltd (ASX: OPY), Laybuy Holdings Ltd (ASX: LBY) and Humm Group Ltd (ASX: HUM) that are all more than 30% below previous highs. So, why is this the case? 

Laybuy and Zip flat on trading updates 

It seems like the glory days where BNPL shares would rocket up on any type of announcement are long gone. The Laybuy and Zip share prices are flat after both updated the market with growth in November.

Laybuy announced a 200% year-on-year increase in gross merchandise value (GMV) of NZ$61 million while Zip announced record transaction volumes in November of $577.1 million, up 44% on October and more than 100% YoY. Despite what reads like a good November update, the Zip share price is down 0.50% and Laybuy share price is up only 1% at the time of writing.  

How is Afterpay different?

International expansion and key partnerships are the main differences between Afterpay and its competitors. 

On 20 October, Afterpay became the first BNPL to form a partnership with a big four bank. The partnership will allow Afterpay to provide Westpac transaction and savings accounts and other cash flow management tools to its 3.3 million customers in Australia in the second quarter of FY21. 

Furthermore, Afterpay is one of the only BNPL companies to have multiple planned expansions. The company launched into Canada in August with a number of large merchants now live, integrating or signed. 

Its acquisition of Pagantis in Europe remains subject to approval from the Bank of Spain. The company calls this acquisition a “key step in our efforts to be a truly global business”. Pagantis provides an opportunity to launch into Spain, France and Italy immediately and to potentially enter other countries in the European Union.

Afterpay also established a base in Singapore to drive the development of a strategy for the Southeast Asia market. 

More reading

• Why Appen, Chalice Gold Mines, Piedmont Lithium, & Zip shares are dropping lower
• Why Laybuy, Mesoblast, Sandfire, & Telix shares are charging higher
• ASX 200 down 0.2%: Zip’s November update, Mesoblast jumps, Westpac’s asset sale
• Zip (ASX:Z1P) share price higher after record November performance
• Laybuy (ASX:LBY) share price on watch after delivering strong growth in November

Lina Lim has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of ZIPCOLTD FPO. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. recommends Sezzle Inc. The Motley Fool Australia owns shares of AFTERPAY T FPO. The Motley Fool Australia has recommended Sezzle Inc. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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Raiz Invest Ltd (ASX: RZI) shares are shooting the moon today, rising 7.61% at the time of writing to 99 cents a share. The Raiz share price closed at 92 cents yesterday afternoon before opening at 93 cents this morning. The company’s shares then shot as high as $1.03 (a new 52-week high), before settling to their current price.

At 99 cents per share, Raiz Invest is valued at a market capitalisation of around $70 million.

It’s been a topsy-turvy year for the Raiz share price. It started out the year at 83 cents and climbed as high as 98 cents in February before the coronavirus-induced share market crash hit this company for six. Raiz shares fell almost 70% between 19 February and 23 March. However, they have also risen 230% between 23 March and today’s share price.

So what is Raiz? And why are the shares making new highs today?

Raiz-ing the stakes

Raiz is an investment company, one specifically targeting ‘millennials’ and young people. Its flagship product is the ‘Raiz’ app, which offers investing services, as well as superannuation.

These ‘investing services’ come in the form of facilitating easy investing into a variety of managed funds run by Raiz. Users can ‘set up’ a plan for periodic investing, such as ‘$5 a week’ or similar. They then choose from one of seven funds Raiz offers, and the investment is converted into units on behalf on the user.

Raiz also offers ’round-ups’, which allow a user to link a credit or debit card to their Raiz account, and have their transactions ’rounded-up’ to the nearest dollar, or another chosen threshold. The excess is then automatically invested in the user’s Raiz account.

ETFs on an app

The seven funds Raiz operates are graded on ‘risk tolerance’ and are mostly invested in underlying index exchange-traded funds (ETFs). They range from ‘conservative’ to ‘aggressive’, with intermediaries like ‘moderately conservative’ and ‘moderately aggressive’. Depending on the choice of fund, the cash will be allocated across a variety of assets. These include Australian shares, international shares, fixed-interest investments and cash.

For example, the Raiz ‘moderately aggressive’ portfolio allocates 43.6% to S&P/ASX 200 Index (ASX: XJO) shares, 13.8% to Asian shares, 6.4% to European shares, 8.9% to United States shares, 21.3% to corporate bonds, 3% to government bonds, and 3% to cash.

Raiz also offers two additional portfolios, the ’emerald’ portfolio and the ‘sapphire’ portfolio. The emerald portfolio has an ethical investing focus, whilst the sapphire portfolio is a hyper-aggressive option which includes a 5% allocation to the cryptocurrency bitcoin.

As we touched on earlier, Raiz also allows users to open a superannuation fund, which is operated in a similar manner to the investment platform.

All of this doesn’t come free, of course. Raiz doesn’t charge users with a zero balance. But once a user has money invested, Raiz takes a $2.50 a month fee on balances under $10,000, and a 0.275% per year fee on balances over $10,000.

Why is the Raiz share price raising the roof today?

Today’s breakout performance for the Raiz share price is most likely due to a monthly update the company released to the markets this morning. In this update, Raiz told investors it increased funds under management (FUM) by 10.6% to $581.34 million over November. Raiz had only surpassed $500 million in FUM for the first time in September.

Active customers in Australia grew 6.4% over the month to 233,477. That represents growth of 51.9% over the past 12 months. Investment accounts were up 6.3% in November to 437,116, an increase of 64.4% over the previous 12 months.

Active customers also grew by 17% to 56,699 in Indonesia, and by 34.8% to 27,787 in Malaysia as well.

Raiz CEO, George Lucas (not the Star Wars director!), had this to say on the numbers:

The growth in Funds under Management in November exceeded our forecasts… This was driven by a strong inflow of funds from existing customers and rising equity markets in November…

The focus over the coming months in Australia is to deliver a portfolio where our customers can choose their own asset allocation, as well as the addition of self-managed super funds (SMSFs), both of which should assist in increasing revenue per customer. In Southeast Asia, we are focused on customer acquisition, which after four months of being fully operational is very pleasing.

More reading

• This cheap ASX share is supplying US giants: fundie
• Raiz (ASX:RZI) share price up on positive business update
• Why these 4 ASX tech shares surged today

Motley Fool contributor Sebastian Bowen has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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Many of Australia’s top brokers have been busy adjusting their financial models again, leading to the release of a large number of broker notes this week.

Three broker buy ratings that have caught my eye are summarised below. Here’s why brokers think these ASX shares are in the buy zone:

Adore Beauty Group Ltd (ASX: ABY)

According to a note out of Morgan Stanley, its analysts have retained their overweight rating and $8.35 price target on this online beauty retailer’s shares. The broker was pleased with its trading update and notes that management has upgraded its guidance for the first half. And while it is keen to see whether this was at the expense of margin, it doesn’t think this is the worst idea if it was. The broker believes a focus on growth at this stage in the shift to online is a smart move. The Adore Beauty share price is trading at $6.23 this afternoon.

Breville Group Ltd (ASX: BRG)

A note out of Macquarie reveals that its analysts have upgraded this appliance manufacturer’s shares to an outperform rating with an improved price target of $27.00. According to the note, the broker believes that sales will be elevated during the holiday season due to a redirection in spending. After which, it expects consumer demand to remain strong for its products in the near term, underpinning solid earnings growth. The Breville share price is changing hands for $25.01 on Wednesday.

Collins Foods Ltd (ASX: CKF)

Analysts at Morgans have retained their add rating and lifted the price target on this quick service restaurant operator’s shares to $11.39. This follows the release of its half year results earlier this week. The broker was pleased with the result and believes it demonstrates the strength of the KFC Australia business. Morgans appears confident that the business will underpin further growth in the second half and FY 2022. This should be supported by improvements across the rest of the company as trading conditions improve. The Collins Foods share price is fetching $10.24 this afternoon.

More reading

• ASX 200 rises on Tuesday
• Why Adore Beauty, Bank of Queensland, Bega Cheese, & McPherson’s are dropping lower
• ASX 200 up 1%: Domino’s rockets, Collins Foods delivers strong result, GPT offloads asset
• Why Collins Foods, Domino’s, Macquarie Telecom, & PolyNovo shares are charging higher
• Adore Beauty (ASX:ABY) share price lower despite upgrading guidance

Motley Fool contributor James Mickleboro owns shares of Collins Foods Limited. The Motley Fool Australia has recommended Collins Foods Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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The SRG Global Ltd (ASX: SRG) share price is up 5.26% in afternoon trading, having retreated from earlier gains of 9%. This follows on the company’s revised guidance update released to the ASX yesterday. Today’s lift in the SRG share price brings the company’s gains to 122% since its shares hit their 2020 low on 24 March. Shares are now on par with where they finished 2019, having reversed the COVID-led selloff earlier this year.

What’s driving the SRG Global share price higher?

The SRG share price is on the move today after the company revised its 2021 financial year guidance for earnings before income, tax, depreciation and amortization (EBITDA) to $42–45 million, up from $38-42 million.

The company forecast its first half FY21 EBITDA will be $19–20 million, and highlighted that $550 million of contracts with repeat and targeted clients have been announced since 1 July.

SRG Global now has $1 billion of work in hand, up 41.5% since 30 June.

Looking ahead, the company stated it expects further near-term contract wins with its repeat and targeted clients.

Commenting on the revised guidance, David Macgeorge, managing director said:

SRG Global’s strategy has been to shift towards a greater proportion of annuity / recurring earnings, with a disciplined focus on core business, core clients and core geographies. This strategy puts the company in a very strong position to continue building momentum into 2021, providing the confidence for our upgraded guidance for FY21…

The company is well-placed to continue to fund future growth requirements with our strong liquidity / balance sheet position. The improved financial performance and guidance is underpinned by our recent contract wins, record work in hand position of $1 billion and a high level of annuity earnings. The outlook for SRG remains positive given the company’s exposure to diverse sectors and geographies, quality commodities, a tier one client base and growing levels of infrastructure construction and maintenance expenditure.

What does SRG Global do?

SRG Global is a construction and maintenance services company. Its operating segments include construction, asset services, and mining services. As part of its construction business, the company supplies integrated products and services for the development of complex infrastructure. These include bridges, dams, high rise towers, car parks, and hospitals.

With the SRG share price up more than 14% in the first two trading days of December, investors are clearly pleased with the upgraded guidance.

More reading

• SRG Global (ASX:SRG) share price is rocketing higher today. Here’s why.
• SRG Global (ASX:SRG) share price up 5% on new contract wins

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. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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Fintech company Cashrewards Limited (ASX:CRW) has started trading on the ASX today following the completion of its successful $65 million initial public offering (IPO).

Minutes after trading began, the Cashrewards share price rocketed up as high as 15.6% to $2.00. It has since retreated to the current price of $1.865, at the time of writing, after initially listing at $1.73.

Proceeds from the IPO

The Cashrewards IPO was strongly supported by both institutions and retail investors. Applications for shares in the financial technology platform significantly exceeded the final raising, resulting in substantial scale back. 

The company says the net proceeds received from the IPO will total $45 million, after payment to selling shareholders and costs associated with the IPO preparation. Cashrewards says these funds will be invested primarily in marketing, product development, and key talent recruitments.

More reading

• Banks rejoice: House prices to return to 2019 levels
• CBA (ASX:CBA) and the ASX banks just had an amazing month
• Fund managers are snapping up these ASX stocks at a record pace
• Here’s when your ASX bank dividends are being paid in December
• Why the banks are back in the ASX 200 spotlight

Motley Fool contributor Eddy Sunarto has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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The 4DMedical Ltd (ASX: 4DX) share price has surged by almost 8% in trading so far today. This comes after the medical technology company announced its partnership with the University of Miami to advance its breakthrough research on lung technology. At the time of writing, the 4DMedical share price is trading at $2.49 after closing yesterday’s session at $2.31.

What’s driving the 4DMedical share price higher today?

The 4DMedical share price is surging higher after the company advised it has partnered with University of Miami Health System (UHealth) to establish the Functional Lung Imaging Research Program within the university’s Miller School of Medicine.

This is 4DMedical’s first research program in the United States health system. The program will use the company’s proprietary ‘XV Technology’ to improve treatment for patients with chronic lung diseases.

More specifically, it will allow researchers and physicians to accurately diagnose ventilatory abnormalities in patients, providing treatment options that are targeted and more effective.

This research program is also expected to deliver a number of preclinical and clinical studies that will include patients with various lung-related conditions, such as emphysema, cystic fibrosis, pulmonary hypertension, pulmonary embolism, and lung cancer.

In technical terms, the research will aim to convert sequences of X-ray images into four-dimensional, quantitative data allowing physicians to better diagnose and treat patients with respiratory diseases.

4DMedical says that its XV Technology is supported by more than 15 years of  research and development in Australia.

More about 4DMedical

4DMedical made its debut on the ASX in August at an initial public offering (IPO) share price of 73 cents. 

Its proprietary product, XV Technology, aims to replace old technology such as X-rays and CT scans which, according to the company, are “out-of-date and not fit for purpose anymore”.

4DMedical’s main clients are obviously hospitals. The company’s main selling point to hospitals is that its software does not require any large capital expenditure and can be integrated with a hospital’s existing systems. 4DMedical charges fees on a per-scan basis, charging US$175 per test using the XV Technology.

The company says its product is still at an early stage, and needs to be commercialised on a mass scale.

About the 4DMedical share price

The 4DMedical share price has shot through the roof since its debut on the ASX in August, having risen by 240% up to today. This rise has been driven by various contract wins and commercialisation of its XV Technology product throughout the year. 

4DMedical currently commands a market capitalisation of around $390 million.

More reading

• Here are the 3 best performing IPO shares in 2020

Motley Fool contributor Eddy Sunarto has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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The BetMakers Technology Group Ltd (ASX: BET) share price has returned from its trading halt and is shooting higher on Wednesday.

In afternoon trade the betting technology company’s shares are up 12% to a record high of 75 cents.

Why is the BetMakers share price shooting higher?

Investors have been fighting to get hold of the company’s shares today after it received firm commitments for an equity raising to fund a major acquisition.

According to the release, BetMakers has received commitments to raise $50 million by way of a placement to fund the acquisition of the assets of leading international online sports betting company Sportech PLC for A$56.2 million.

BetMakers is raising the funds through the issue of 83.3 million new shares at 60 cents per share.

BetMakers’ Managing Director, Todd Buckingham, commented: “BetMakers welcomes the strong support of institutional and sophisticated investors, both existing and new, in the Placement. We also look forward to conducting a Share Purchase Plan offer as an opportunity for all existing shareholders to participate.”

Why is BetMakers acquiring the assets of Sportech?

This acquisition is intended to accelerate BetMakers’ international growth plans and significantly expand its global customer base and strategic position to fully capitalise on emerging opportunities in the U.S. market.

This is particularly the case with fixed odds wagering, which management sees as a key driver of growth in the future.

Management advised that the acquisition is expected to deliver substantial revenues and earnings before interest, tax, depreciation and amortisation (EBITDA) for the BetMakers’ business.

On a pro-forma basis for FY 2020, the Tote and Digital Business combined with BetMakers’ existing operations would have delivered A$56.1 million revenue and A$7.7 million EBITDA. This compares to the stand-alone revenue of A$9.2 million and EBITDA of A$0.8 million BetMakers recorded in FY 2020.

Mr Buckingham commented: “This Acquisition will supercharge our entry into the U.S. and position the Company for substantial growth on the back of the emerging wagering opportunities in U.S. racing, including Fixed Odds, where we believe we are well placed.”

More reading

• BetMakers (ASX:BET) share price on watch after announcing major acquisition
• Here are the best performing ASX tech shares in November

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. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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The Australian economy is recovering from the coronavirus pandemic and associated lockdowns, according to the Australian Bureau of Statistics (ABS).

The ABS published its economic data and statistics for the quarter ending 30 September 2020 this morning. It reported that economic activity, as measured by gross domestic product (GDP), rose 3.3% on a seasonally adjusted basis for the 3 months ending 30 September.

ABS national accounts head Michael Smedes said that number represented a “partial recovery” for the Australian economy.

The 3.3% growth rate comes after the Australian economy shrank by a record 7% in the previous quarter (the 3 months to 30 June). However, in terms of annual growth, the ABS has recorded a 3.8% drop in GDP for the 12 months ending 30 September.

Mr Smedes said despite “record quarterly growth in household spending”, the level in September quarter was 6.8 per cent lower than that recorded in December quarter 2019.

Spending drives a recovery

The ABS said household spending drove the quarterly recovery, rising 7.9% on average, with a 9.8% increase in spending on services and a 5.2% increase in spending on goods. The rise in ‘services’ spending was concentrated on hotels, cafes, restaurants, and cultural- and health-related services.

All states recorded increased household spending, with the exception of Victoria. That state saw a 1.2% drop, likely due to its extended period of lockdown in recent months.

The ABS said the higher spending lead to “compensation of employees” rising 2.3% over the quarter, as work hours and part-time employment increased. Household savings-to-income ratios fell, but remain “elevated” at 18.9%, compared with 22.1% in the previous quarter.

The ABS noted that net trade detracted 1.9% from GDP during the quarter as well. That was reportedly the largest quarterly detraction since September 1980. This fall was sparked by imports of goods and services rising due to the easing of restrictions, while exports of goods and services fell. The ABS attributed that to “weaker demand for Australian mining commodities and constraints on travel”.

Reserve Bank weighs in

Reporting from the Australian Broadcasting Corporation (ABC) today quoted Reserve Bank of Australia governor, Dr Philip Lowe, on these numbers:

Given these developments, we are now expecting GDP growth to be solidly positive in both the September and December quarters. And then, next year, our central scenario is for the economy to grow by 5 per cent and then 4 per cent over 2022…

These positive figures, though, cannot hide the reality that the recovery will be uneven and it will be bumpy and it will be drawn out. Some parts of the economy are doing quite well, but others are in considerable difficulty.

Australia is likely to experience a run of years of relatively high unemployment, unemployment being too high and wage increases and inflation being too low, leaving us short of the Reserve Bank’s goals.

The RBA left interest rates at the record low of 0.1% at its monthly meeting yesterday. It will also keep the bond-buying program (which some call quantitative easing) in place for the foreseeable future.

More reading

• Why Appen, Chalice Gold Mines, Piedmont Lithium, & Zip shares are dropping lower
• After a record November, what’s next for ASX 200 shares?
• Elon Musk wants to steer Tesla towards higher profits
• Why Rio Tinto (ASX:RIO) and 2 other ASX iron ore mining shares sit at record highs
• Why Laybuy, Mesoblast, Sandfire, & Telix shares are charging higher

Motley Fool contributor Sebastian Bowen has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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The S&P/ASX 200 Index (ASX: XJO) is on course to give back some of yesterday’s strong gains. In afternoon trade the benchmark index is down 0.3% to 6,568.9 points.

Four shares that are falling more than most today are listed below. Here’s why they are dropping lower:

Appen Ltd (ASX: APX)

The Appen share price is down 2% to $31.72. This is despite there being no news out of the artificial intelligence services company. However, a number of tech shares are tumbling lower on Wednesday even after a strong night of trade for the tech-focused Nasdaq index. At the time of writing, the S&P/ASX All Technology Index (ASX: XTX) is down 0.5%.

Chalice Gold Mines Limited (ASX: CHN)

The Chalice Gold Mines share price has returned from its trading halt and dropped 5% to $3.86. This morning the mineral exploration company announced firm commitments for its $100 million institutional placement. Chalice Gold Mines is raising the funds at $3.75 per new share, which represents a discount of almost 8% to its last close price. These funds will be used to accelerate its exploration activities.

Piedmont Lithium Ltd (ASX: PLL)

The Piedmont Lithium share price is down 5% to 37 cents despite a positive announcement. This morning the US-based lithium miner announced the appointment of Primero Group and Marshal Miller to undertake the definitive feasibility study (DFS) for its planned spodumene concentrate operation in North Carolina. The DFS will target production of 160,000 tonnes per year of spodumene concentrate.

Zip Co Ltd (ASX: Z1P)

The Zip Co share price is down 1% to $5.97. This following the release of a trading update which revealed a record performance during November. The buy now pay later provider reported record transaction value of $577.1 million for the month. This was up 44% month on month and more than 100% year on year. This was driven by a 157% increase in monthly transaction numbers and a 104% year on year increase in customer numbers to 5.3 million. Investors appear to have been expecting even stronger growth.

More reading

• ASX 200 down 0.2%: Zip’s November update, Mesoblast jumps, Westpac’s asset sale
• Zip (ASX:Z1P) share price higher after record November performance
• 5 things to watch on the ASX 200 on Wednesday
• Flight Centre and Mesoblast were among the most traded shares on the ASX last week
• ASX 200 drops 0.5%: Treasury Wine sinks, Zip flat after AGM update, Bega Cheese rises

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 Appen Ltd and ZIPCOLTD FPO. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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November 2020 is a month Australian share investors will long recall.

The All Ordinaries Index (ASX: XAO) posted its strongest gains in more than 32 years, going back all the way to March 1988.

And the 10.6% gain on the S&P/ASX 200 Index (ASX: XJO) delivered the best month for the top 200 ASX shares ever. A record which came despite the index slipping 2.9% from its monthly peak on 25 November.

Investors who sold their shareholdings during the pandemic-fuelled market mayhem earlier this year will have likely been watching those gains notch up as well. All too aware of the 0.6% annual rate they were earning from their term deposits. (Albeit, with far less risk.)

And it wasn’t just ASX shares that enjoyed a stellar month.

United States shares rocketed higher too.

The S&P 500 Index (SP: .INX) gained 10.8% in November. And closed another 1.1% higher yesterday (overnight our time), setting a fresh record high on the first trading day of December.

Meanwhile, the tech-heavy Nasdaq Composite (NASDAQ: .IXIC), which also posted a new record high yesterday, gained 11.8% in November.

And all this as the virus continues to wreak havoc across much of the world and with the much-anticipated trillion-dollar US stimulus package having yet to pass.

So that was last month.

And while this month is off to a good start, with the ASX 200 up again in December so far (at the time of writing), the million-dollar question is can shares continue to march higher into 2021?

What’s next for ASX 200 shares?

Aussie and US investors remain highly bullish on their outlook for share market performance in the year ahead.

A big shorter-term driver for equities could be seeing that stalled trillion-dollar US stimulus package finally given the stamp of approval.

A group of Democratic and Republican senators are pressing for a roughly US$900 billion (AU$1.2 trillion) spending package before the end of the year.

President-elect, Joe Biden, looks to have their back, telling Congress to pass “a robust package” to buoy the world’s largest economy.

And the former head of world’s most powerful central bank and likely next US Treasury Secretary, Janet Yellen, offered these reassuring words:

To the American people: We will be an institution that wakes up every morning thinking about you, your jobs, your paycheques, your struggles, your hopes, your dignity and your limitless potential.

So what kind of share price gains could investors be looking at?

According to Fundstrat Global, the S&P 500 could see gains of more than 9% in the first quarter of 2021, quoted by the Australian Financial Review:

The equity market backdrop remains bullish with the recent consolidation likely to resolve to the upside through year-end. A doubling [of] the fall 2020 trading range support[s] a move toward S&P 4000 in the first quarter of 2021 and toward a cycle 4400-4600 in 2022/2023 based on the average moves in prior four-year cycles.

(The S&P 500 is currently at 3,662 points.)

Mark Haefele, UBS Global Wealth Management’s chief investment officer, explains why investors, and UBS, remain bullish (quoted by Bloomberg):

Investors have been prepared to look beyond the near-term continued rise in COVID-19 cases in many regions. They have focused instead on the potential for a return to normal social and economic activity based on the widespread roll out of effective vaccines in the first half of 2021. We see further upside for global equities in this environment, but also expect market leadership to continue to shift.

And Bank of America Corp (NYSE: BAC) sees the potential for significant share price gains in 2021 as well (quoted by the AFR):

The Sell Side Indicator (SSI), our measure of Wall Street strategists’ bullishness on stocks, saw another big increase in November to 57.8 per cent from 57.0 per cent. The rise in sentiment puts the SSI at the highest level in 18 months.

With the S&P 500’s indicated dividend yield of 1.6 per cent, this implies a 12-month price return of +8.6 per cent and an S&P 500 level of 3933 in twelve months. This indicator is one of our most bullish target models and highlights that sentiment on stocks is not yet at the euphoric levels one typically sees at the end of bull markets.

Historically, when our indicator has been this low or lower, total returns over the subsequent 12 months have been positive 93 per cent of the time, with median 12-month returns of +17 per cent. However, past performance is not an indication of future results.

Here comes the pent-up demand

Turning the focus back home, the holiday shopping season is upon us.

As reported by the AFR, The National Retail Association (NRA) is forecasting consumer spending will set new records this Christmas season, unleashing the pent-up demand from months in various stages of lockdown.

The Association estimates Aussies will spend $52.3 billion in brick-and-mortar shops, up 5% year on year. And the $5.2 billion of online spending the NRA forecasts represents a phenomenal 53% leap from the 2019 holiday season.

If these figures prove out, that should spell good news for many of Australia’s leading retail shares. Particularly companies with a strong online presence.

Online retailer Kogan.com Ltd (ASX: KGN) could see a fresh lift in demand for its consumer electronics, furniture, and fitness offerings. The Kogan share price, down 35% from its mid-October highs, is up 120% year to date.

Iconic Aussie retailer JB Hi-Fi Limited (ASX: JBH) – with a strong online and brick-and-mortar presence – could also see a spike in sales for its home entertainment, IT products, white goods and home appliances. The JB Hi-Fi share price is down 11% from mid-October but remains up 22% so far in 2020.

More reading

• Why the Afterpay (ASX:APT) share price and these ASX stocks could get a boost next week
• Kogan (ASX:KGN) share price falls on option grants to top execs
• 3 ASX shares growing the dividend rapidly
• 4 ASX growth shares to buy in December
• Why these All Ords shares have been smashed this month

Bernd Struben has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of Kogan.com ltd. The Motley Fool Australia has recommended Kogan.com ltd. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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