Why did the Pointsbet share price surge 12% on Wednesday?

We check what may be behind the betting technology company's surge this morning.

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Key points

  • The ASX 200 is having another strong day this Wednesday
  • But many ASX tech shares, including Pointsbet, are doing even better
  • We check what might be at play

The S&P/ASX 200 Index (ASX: XJO) has had another strong day so far this Wednesday. During this trading session, the ASX 200 has gained a healthy 0.4% at the time of writing, putting it back above 6,800 points. But the Pointsbet Holdings Ltd (ASX: PBH) share price has performed even better.

Pointsbet shares closed at $2.22 each yesterday. But the gaming company opened at $2.23 this morning before rocketing as high as $2.50 a share, a 12.5% gain.

As it currently stands this afternoon, the Pointsbet share price has cooled somewhat from these illustrious heights. But the company is presently still up a robust 3.6% at $2.30 a share.

So what has kicked the Pointsbet share price so comprehensively higher today?

Why did the Pointsbet share price surge 12% this morning?

Well, we can't be sure, unfortunately. We did get an update from Pointsbet today, released just before market open this morning. But this update only served to inform shareholders that the company is scheduled to hold its 2022 annual general meeting tomorrow. Hardly market-moving stuff, one would assume.

However, we can look at what is happening to some other ASX tech shares for more ideas. Pointsbet isn't the only ASX tech share performing well today.

We've also seen shares like Altium Limited (ASX: ALU), HUB24 Ltd (ASX: HUB), Redbubble Ltd (ASX: RDB), and Brainchip Holdings Ltd (ASX: BRN) see big jumps in valuation as well. Many of these share prices, like Pointsbet's, also spiked before calming down during the afternoon.

This could be a result of what happened to US tech giant Netflix Inc (NASDAQ: NFLX) shares overnight.

As my Fool colleague Catherine covered this afternoon, Netflix reported its quarterly earnings last night (our time). After some disappointing results earlier in the year, Netflix seemed to delight investors with its latest numbers.

For the third quarter of 2022, the company managed to add an additional 2.41 million net subscribers. It also announced revenues of US$7.93 billion, up 5.9% year on year.

These results saw the Netflix share price rise 14% in after-hours trading, boosting the futures market of the entire NASDAQ Index.

This seems to have given the entire ASX tech sector a shot in the arm today, which could explain the fortunes of the Pointsbet share price this Wednesday.

Whatever the true reason behind the success of the Pointsbet share price today, no doubt investors will be pleased with what they are seeing.

At the current Pointsbet share price, this ASX 200 gaming company has a market capitalisation of $678 million.

 

Motley Fool contributor Sebastian Bowen has positions in Netflix. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has positions in and has recommended Altium, Hub24 Ltd, Netflix, Pointsbet Holdings Ltd, and REDBUBBLE FPO. The Motley Fool Australia has positions in and has recommended Hub24 Ltd. The Motley Fool Australia has recommended Netflix and Pointsbet Holdings Ltd. 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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