Why did the Zip share price just rocket 9%?

BNPL stock Zip is surging today. What's going on?

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It's been an encouraging Tuesday for the All Ordinaries Index (ASX: XAO) and most All Ords shares so far. At present, the All Ords has put on a solid 0.45% and is back over 7,240 points. But let's talk about the Zip Co Ltd (ASX: ZIP) share price for a moment.

Zip shares are doing better than the All Ords. A lot better.

Yesterday, the buy now, pay later (BNPL) stock closed at 28 cents each. But today, Zip shares are going for 30 cents at the time of writing, up a happy 7.14%. Earlier this morning, we saw Zip shares climb as high as 30.5 cents as well. That was a gain worth almost 9% at the time.

So what's going on with the Zip share price that has elicited such a healthy rise for investors this Tuesday?

Well, unfortunately, it's not clear at all why this BNPL stock is enjoying such a positive session today. There hasn't been any official news or announcements out of Zip this Tuesday. Or indeed for almost a fortnight.

What we are seeing today though is a top day for most ASX tech stocks. At present, the tech sector is leading the ASX's gains, with the S&P/ASX 200 Information Technology Index (ASX: XIJ currently up a rosy 1.93%.

We are also seeing some big moves with some of the ASX's other BNPL shares. Zip rival Afterpay's owner Block Inc (ASX: SQ2) has bounced 2.5% higher today to $70.60 a share, while Sezzle Inc (ASX: SZL) stock is up an encouraging 4.2% to $17.09.

Last night on the US markets, we also saw the American BNPL stock Affirm Holdings Inc (NASDAQ: AFRM) gain an impressive 4.89% to US$18.88 a share.

So perhaps Zip has just been caught up in this BNPL buying craze today.

Zip share price bounces off historic lows

We should also consider the possibility that some big investor is seeing some value in the Zip share price right now, which remains a beaten-down dog by ASX standards.

Even after today's gains, Zip shares are nursing a nasty 47% loss over 2023 to date. The company is also down more than 50% over the past 12 months, as well as down by more than 97% from its all-time highs of over $12 a share, as you can see below:

Zip share price performance

Whatever the cause of today's impressive gains from Zip shares, no doubt this ASX BNPL stock's investors will be delighted. Let's see what happens next.

Motley Fool contributor Sebastian Bowen has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has positions in and has recommended Block and Zip Co. The Motley Fool Australia has positions in and has recommended Block. 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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