The Betmakers Technology Group Ltd (ASX: BET) share price is going for gold. At the time of writing, shares in the wagering technology company are trading for $1 each – up 7.57%.
While the company hasn’t made any price sensitive announcements for the past 3 days, there are several external factors that might be playing a role in today’s massive price rise.
Let’s take a closer look.
Tech shares are up
It’s not just the Betmakers share price that’s going gangbusters. Other tech shares like Zip Co Ltd (ASX: Z1P) and WISR Ltd (ASX: WZR) are up 4.7% and 9% respectively. In fact, the entire S&P ASX All Technology index (ASX: XTX) is 2.17% higher at the time of writing.
Why is that? One answer might lie across the Pacific Ocean.
As Motley Fool’s own Scott Phillips has previously told this reporter:
The old saying is ‘when America sneezes, Australia catches a cold’.
In other words, when American markets are down, Aussie markets are down. When US markets are up, so is the ASX.
The tech heavy NASDAQ Composite rose 0.7% overnight after a fall in US 10-year treasury bond yields.
According to the Financial Times, comments by US Federal Reserve Chair, Jerome Powell, about a possible tapering of bond buybacks sent yields falling.
According to FT, analysts are reading Powell’s comments to mean a slowdown in quantitative easing happening soon, but not too soon. This sent bond prices rising and thus yields falling as they are inversely related.
The relationship between 10-year bond yields and tech shares is also inversely related.
Why else would the Betmakers share price be flying?
Another reason the Betmakers share price might be doing so well is recent news by industry compatriot PointsBet Holdings Ltd (ASX: PBH). PointsBet has announced an underwritten capital raising of approximately $400 million.
PointsBet will be selling about 23 million new shares, with retail trading rights, for $8.00 per new unit. This is a discount of 29% on the current PointsBet share price.
As more shares will be on the market, this will increase their supply and thus decrease their price.
This capital raising by a fellow wagering company might be having an impact on the Betmakers share price.
Betmakers share price snapshot
Over the past 12 months, the Betmakers share price has increased 126%. Year-to-date it is 42.1% higher. Its 52-week high is $1.65 and its low in that period is 38 cents per share.
Betmakers has a market capitalisation of $838 million.