MENU

Why A2 Milk Company Ltd (ASX:A2M) and Bellamy’s Australia Ltd (ASX:BAL) shares are surging higher

The A2 Milk Company Ltd (ASX: A2M) share price and Bellamy’s Australia Ltd (ASX: BAL) share price have been among the best performers on the market on Thursday.

In early afternoon trade the a2 Milk Company share price is up almost 9% and the Bellamy’s share price is 5.5% higher.

The Blackmores Limited (ASX: BKL) share price is also climbing notably higher and is up 5% at the time of writing.

Why are these shares racing higher today?

Investors have responded positively to news out of China in relation to tough new e-commerce laws.

According to the Chinese government website, the State Council has decided not to implement new e-commerce laws on January 1 and will instead refine its existing policies.

There had been concerns that these new laws could have impacted the sales of exporters like a2 Milk, Bellamy’s, and Blackmores.

What is happening on January 1 now?

From January 1 the Chinese government will extend the current Cross Border E-Commerce (CBEC) policy framework. This means that imported items will continue to be viewed as “Personal Use” items and will not require registration or first import licence approval.

In addition to this, tax benefits and transaction limits remain favourable. According to a note out of Goldman Sachs, imported items through the CBEC channel will continue to enjoy tax benefits and the personal transaction limit will increase to RMB5000 from RMB2000 for a single transaction and to RMB26K from RMB20K for the annual limit.

Below is a quick summary of the changes.

Source: Goldman Sachs

Is this good news?

I believe this is a big positive for companies exporting to China and takes that element of doubt out of the equation. Because of this, I can’t say I’m surprised to see the shares of a2 Milk, Bellamy’s, and Blackmores surge higher today.

I felt a2 Milk Company and Bellamy’s were buys prior today, but this news just sweetens the deal now in my opinion.

Finally, here are three more growth shares that I think could be great options as well in 2019.

Top 3 ASX Blue Chips To Buy For 2019

For many, blue chip stocks mean stability, profitability and regular dividends, often fully franked..

But knowing which blue chips to buy, and when, can be fraught with danger.

The Motley Fool’s in-house analyst team has poured over thousands of hours worth of proprietary research to bring you the names of "The Motley Fool’s Top 3 Blue Chip Stocks for 2019."

Each one pays a fully franked dividend. The names of these Top 3 ASX Blue Chips are included in this specially prepared free report. But you will have to hurry. Depending on demand – and how quickly the share prices of these companies moves – we may be forced to remove this report.

Click here to claim your free report.

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Blackmores Limited. The Motley Fool Australia owns shares of A2 Milk. 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.

The 5 mining stocks we’re recommending in 2019…

For decades, Australian mining companies have minted money for individual investors like you and me. But if you believe the pundits and talking heads on TV, those days are long gone. Finito! Behind us forever…

We say nothing could be further from the truth. To earn the really massive returns, you’ve got to fish where others aren’t fishing—and the mining sector could be primed for a resurgence. That’s why top Motley Fool analysts just revealed their exciting new research on 5 ASX miners they believe could help you profit in 2019 and beyond…

Including:

The best way we see to play the global zinc shortage… Our #1 favourite large-cap miner (hint: it’s not BHP)… one early-stage gold miner we think could hit the motherlode… Plus two more surprising companies you probably haven’t heard of yet!

For free access to our brand-new research, simply click here or the link below. But be warned, this research is available free for a limited time only, and we reserve the right to withdraw it at any time.

Click here for your FREE report!