Last week, the ASX continued its upwards trajectory with the All Ordinaries Index (ASX: XAO) rising by 4.3% across the week. The market was buoyed largely by a mini boom in buy now, pay later (BNPL) companies and very large volumes being traded in the Australian real estate investment trusts (A-REITS).
Buy now pay later
The optimism in the emerging BNPL sector was pretty hard to miss last week. Zip Co Ltd (ASX: Z1P) opened the batting with news of a US acquisition to help it expand further into that market. After surging by 30% last Monday, the Zip share price finished 50.4% up for the week. Zip shares rose by another whopping 15.78% yesterday.
All BNPL challengers experienced double digit share price growth last week, with the smaller companies leaping the highest. Openpay Group Ltd (ASX: OPY) ended the week up by 139% on news of a $30 million placement to fund growth. The BNPL provider dipped slightly yesterday, dropping back by 4.87%.
The A-REITS also had a very good week and led the large cap and mid cap market in terms of volumes traded. Vicinity Centres (ASX: VCX) led the charge with a successful $1.2 billion placement at a discount and an announcement to cancel distributions for the 6 months to 30 June. The Vicinity share price ended the week up by 13.7% and gained another 5.74% in yesterday’s trade.
Others also saw share price rises and heavy trading. Scentre Group (ASX: SCG) was the breakaway A-REIT, with a share price gain of 16.7% across the week. Scentre shares continued that upward trajectory yesterday with a gain of 9.52%.
Surging share prices raised up several companies last week. Yet among those, the Kogan.com Ltd (ASX: KGN) share price’s 10.24% gain last week is notable because of what it indicates. The company reported surges in sales in April and May, even as stay at home restrictions were lifted. This underlines the ongoing shift in Australian consumer behaviour to online shopping – a move hastened by the recent lockdown.
The most enjoyable story for me last week was the sudden leap by West Australian robotics company FBR Ltd (ASX: FBR). Formerly Fastbrick Robotics, the company manufactures a robot called Hadrian X – a construction robot that can build the walls of a structure from a 3D CAD model. Investors seemed pleased by the company’s announcement that its robot had achieved a rate of 200 bricks per hour in recent trials. FBR Ltd’s share price finished the week up by 173.9%.
The gold sector saw a plunge in share prices last week. As sentiment in equities has increased, gold and other precious metals have seen their prices stabilise in US dollars. However, the rising Australian dollar has exacerbated this for our gold miners. Saracen Mineral Holdings Limited (ASX: SAR) saw its share price fall by 13.3%. Gold Road Resources Ltd (ASX: GOR) also saw double digit share price decay. Its share price was down by 14.6% over the week. Both shares continued to slide in yesterday’s trade, with Saracen down another 6.6% and Gold Road down by 9.35%.
Outside of the gold mining companies on interesting story was Nufarm Limited (ASX: NUF). The agricultural chemical company’s share price fell by 7.5% after the company disclosed impacts to its business by the COVID-19 pandemic. It appears this will have a long term impact that is only now coming to light. Nufarm shares dropped another 3.04% in yesterday’s trade.
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Daryl Mather 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 owns shares of and has recommended Kogan.com ltd. The Motley Fool Australia has recommended Scentre Group. 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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