The BHP Group Ltd (ASX: BHP) share price had a volatile time during March 2023, yet, at the time of writing, the ASX mining share has managed to achieve a gain of 4%. That compares to the S&P/ASX 200 Index (ASX: XJO) which fell by around 1%.
As a reminder for readers, BHP is one of the world's largest resource businesses, so movements in key commodity prices (such as iron) can have a large impact on the business.
Between the start of the month and 6 March 2023, the BHP share price actually went up by 7%. The ASX 200 only increased by 1% during that time, despite the sizeable influence that BHP has on the index due to its large market capitalisation.
Between 6 March and 20 March, the BHP share price dropped by 11.2%, which is a large decline over a relatively short amount of time for such a large business. Over that same time, the ASX 200 declined 5.9%.
Since that low up to the time of writing on 31 March 2023, the BHP share price has risen over 9% and the ASX 200 has gone up by 4%.
The ASX mining share's movements have been stronger than the index each time, but its healthier gains have meant that it is ending with a noticeably better return than the ASX 200.
What caused this volatility for the BHP share price?
Sometimes market movements can't be explained. Each day, different buyers and sellers are involved in making decisions about what price they want to transact at. A bit of pessimism about something happening in the global market can influence which direction resource prices and ASX mining shares go. The banking crisis may have been a factor.
Reporting season was last month, which is when investors got an insight into how the business performed in the six months to 31 December 2022. But, the effects of the interim dividend were felt in March because the miner went ex-dividend, which I think explains some of the declines during the month.
Going ex-dividend means that on the ex-dividend date, new investors are not entitled to that imminent dividend.
With BHP shares, they went ex-dividend on 9 March 2023, and some investors may have been buying shares before the ex-dividend date to ensure their entitlement – pushing up the BHP share price.
In Australian dollar terms, the dividend is going to be $1.364. That dividend represented a 3% dividend yield if we use the valuation at the start of the month. So, the ASX mining share has managed to deliver that capital growth despite the headwind of going ex-dividend.
The commodity giant may also have felt the wave of investor uncertainty relating to the banking sector in the northern hemisphere after the collapse of Silicon Valley Bank (SVB) and the rushed takeover of Credit Suisse.
If there were widespread economic problems, then that could lower demand for resources. However, some of that uncertainty seems to be lifting with the BHP share price and global markets rising in the last couple of weeks.
Year-to-date snapshot
Since the start of the year, the ASX mining share has gone up by close to 4%.
