The S&P/ASX 200 Index (ASX: XJO) is having a grand old time of it on the sharemarkets today. At the time of writing, the ASX 200 is up by a healthy 1.23% at just over 7,350 points. It seems ASX 200 investors largely have the BHP Group Ltd (ASX: BHP) share price to thank.
BHP shares are having a very strong day indeed today. The mining giant is currently up a healthy 4.74% at $48.65 a share. Since BHP is the largest share by market capitalisation in the ASX 200 Index, it is the share with the most impact on the ASX 200's movements.
So why is the BHP share price having such a pleasing day of gains so far this Tuesday?
Well, it's not entirely clear. There have been no major news or announcements released from the company itself recently.
But a good guess would be what has been happening on the commodity markets over the past 24 hours. Commodities of almost all stripes have had a very pleasing day or two.
As my Fool colleague James covered this morning, oil has had an especially strong rally. WTI crude was up 7.3% overnight to over US$112 a barrel, while Brent crude shot even higher, rocketing by 7.7% to just over US$116 a barrel. Iron ore is also on the rise. According to Business Insider, iron ore is currently going for US$150.59 a tonne. That's up from the US$144 levels we saw only a few days ago.
BHP has operations in both iron ore and oil, so these moves are obviously good news for the miner.
BHP shares shoot higher amid booming commodity prices
Another factor that might be affecting the BHP share price is the Australian dollar. The Aussie has spent the last week climbing against the US dollar. Well, until yesterday. The Aussie recently peaked at over 74 US cents a few days ago. But since then, it has come back to earth somewhat. At the time of writing, it is only asking 73.88 US cents.
Since BHP exports most of its commodities, a strong Aussie dollar means it will receive fewer Aussie dollars than it would if the currency was lower. So conversely, that means a falling Aussie dollar makes BHP's exports more attractive.
So it could be a combination of these factors that are helping to push up the BHP share price so decisively today. We also see similar moves in BHP's mining peers like Rio Tinto Limited (ASX: RIO) and Fortescue Metals Group Limited (ASX: FMG), albeit not quite as enthusiastic. Rio shares are currently up 3.4%, while Fortescue's gains are closer to 1.5%.
Today's rise means the BHP share price is now up 14.7% year to date in 2022 so far. At the current share price, BHP has a market capitalisation of $234 billion, with a dividend yield of 9.87%.
