Why has the Macquarie (ASX:MQG) share price rallied 9% in a month?

Financials are leading the broader market in 2022.

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Key points
  • Macquarie shares are powering up this month and have rallied back into the green
  • Some brokers appear positive on Macquarie, whilst broadly, ASX financials are staging gains as well
  • The Macquarie share price is up 29% over the past 12 months

Shares in Macquarie Group Ltd (ASX: MQG) finished the session on Friday up 0.65% to $197.87 apiece.

It's been a busy month for the Aussie investment bank, with its share price charging 9.45% higher.

Generally speaking, ASX financials have propped up the broader market in 2022. Macquarie has been a major contributor alongside the other big listed banks.

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Image source: Getty Images

Spicy recipe of macro flavour and analyst sentiment

The S&P/ASX 200 Financials Index (ASX: XFJ) has spiked 7.2% in a comeback over the past 30 days. Macquarie has moved with it, bouncing from a one-month low of $175.31 on 7 March.

After two months of volatility, financials like Macquarie have powered back up. They are now among the leading sectors of 2022 behind ASX resources shares.

For example, Morgans has a $200 share price target on Macquarie, even though it is neutral on the bank. At the time of the broker's release, the bank was trading near $176.

Meanwhile, Morgan Stanley values the bank at $250 per share, suggesting considerable upside if the broker's thesis pulls through.

The broker bets that buoyant commodity markets – particularly energy markets in Europe – will drive earnings growth for Macquarie in 2022.

Energy markets have soared in Europe lately amid geopolitical tensions. UK gas prices are up 460% year-on-year whilst Brent Crude has moved another 22% higher this month.

In Macquarie's revenue breakdown last year, commodity markets were a key driver to turnover, as printed in its financial statements.

What else is impacting the Macquarie share price?

Macquarie has lodged a joint competing bid to acquire Uniti Group Ltd (ASX: UWL) in a $5 per share all-cash proposal.

As reported on Thursday, Macquarie Infrastructure and Real Assets Holdings Pty Limited (MIRA) and the Public Sector Pension Investment (PSPI) board have lodged a bid for Uniti.

Collectively, the pair have labelled themselves 'Connect Consortium'. MIRA operates within Macquarie Asset Management's Real Assets division.

It remains to be seen if there is any correlation between the gain in Macquarie's share price this week and the Connect Consortium's bid.

The bank has been delivering good returns for ASX investors over the past 12 months, with the Macquarie share price up 29% for the period.

Motley Fool contributor Zach Bristow has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Macquarie Group Limited and Uniti Group 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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