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Why the Wesfarmers (ASX:WES) share price is up today

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The Wesfarmers Ltd (ASX: WES) share price is having a top day today. At the time of writing, Wesfarmers shares are up 1.61% to $53.07 a share. That looks especially impressive when you consider the broader S&P/ASX 200 Index (ASX: XJO) is up 1.56%.

Today’s move caps off what has been a pretty good month for Wesfarmers shares. Since 1 March, the Wesfarmers share price is up 5%. Saying that, this conglomerate is still more than 5% below the all-time high of $56.40 a share that we saw back in February.

This ASX blue chip has done exceptionally well over the past year, which of course includes the pandemic and all of the economic woes that came along with it.

Over the past 12 months, Wesfarmers shares are up a staggering 55.5%. They are also up more than 16% from the pre-COVID high that Wesfarmers hit (just over $46), which was an all-time high at the time. 

So why have Wesfarmers shares been in demand of late in particular?

The stars align for Wesfarmers shares

Everything has been going the way of Wesfarmers over the past year. Its flagship retail chains – Bunnings Warehouse and Officeworks – benefitted enormously from lockdowns. It seems when people in lockdown have nothing to do but renovate their houses and build home offices, Bunning and Officeworks do well.

But here’s what might be the one real gamechanger for Wesfarmers shares of late: lithium.

Wesfarmers became a player in the lithium space when it acquired lithium miner Kidman Resources back in 2019. Today, the company has expansive plans to build a lithium mine, concentrator and refinery at its Mt Holland lithium project in Western Australia that it inherited from Kidman. Lithium production is expected to commence in the second half of 2024.

Lithium miners and producers have been enjoying a surge in investor sentiment over the past few months, which may have spilled over into the Wesfarmers share price. Just take an ASX lithium miner like Pilbara Minerals Ltd (ASX: PLS). Its share price is up 150% over the past 6 months. Another lithium miner in Galaxy Resources Limited (ASX: GXY) is up 125%.

It’s possible that investors have noticed the surging values of companies in this sector and have rewarded Wesfarmers accordingly.

And, after the year Wesfarmers has had, that’s just another feather in its cap, it seems.

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Motley Fool contributor Sebastian Bowen has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of Wesfarmers 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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