While August is kicking off with a bit of a whimper, July was a huge month for Commonwealth Bank of Australia (ASX: CBA) shares.
Shares in the S&P/ASX 200 Index (ASX: XJO) bank stock closed on 28 June trading for $127.38. Shares ended the day on 31 July changing hands for $137.49 apiece.
That saw CBA shares up an impressive 7.9% in July, far outpacing the 4.2% monthly gains posted by the ASX 200.
This strong outperformance also marked a milestone for Australia's biggest bank.
Here's what's been happening.
CBA shares race ahead of the ASX 200
July's strong performance came after a gangbuster FY 2024, in which CBA shares soared 27% over the 12 months, smashing the 7.8% one-year gains delivered by the ASX 200.
That ongoing outperformance also prompted almost every financial analyst to advise that CommBank stock was overvalued and due for a big correction.
I hope you didn't take their advice and sell your holdings at the start of July or let that bearish sentiment scare you off buying new shares.
Indeed, CommBank notched a series of new all-time highs over the month.
On 9 July, the ASX 200 bank stock finished up 1.8% at a record closing high of $128.69 a share.
Investor sentiment may have gotten a boost from CBA's amended forecast for housing price growth in 2024.
According to CBA senior economist Belinda:
We have held a long-term view that national home prices would lift by 5% this calendar year.
In recent months, we have highlighted upside risks to this forecast based on acute housing shortages, strong demand and below average listings on the market.
As a result of these factors and monthly home price rises remaining stronger than expected we revise our forecasts to expect a 7% lift this year.
With CBA shares continuing to trend higher, 12 July marked a milestone day for the company.
That was the day CBA not only could claim the title of Australia's biggest bank but it also edged out BHP Group Ltd (ASX: BHP) as the biggest company in terms of market cap on the ASX.
That reversal came as BHP shares continued to struggle amid sliding iron ore and copper prices.
CBA shares, meanwhile, look to have caught tailwinds with the Aussie economy's resilience despite elevated interest rates decreasing the outlook for a big lift in non-performing loans.
International investors were also reported to be buying the ASX 200 bank stock in search of greater stability outside of Chinese shares.
CBA ended July with a record-high market cap of approximately $230 billion.
