After a month of relative quiet, investors have found plenty to take their interest this week, with volatility returning to the market and volumes dramatically rising. The market closed up 1.9% on Thursday, ending the day at a little over 7300 points, but ends the previous five days down half a percent, and the month of September down over 2%. These market conditions tend to attract enthusiastic buying on the nabtrade platform, as investors seek to add to their portfolios on weakness. And this week was no different – volumes spiked and trading was heavily skewed to the buy side. Despite the outflow for settling their share purchases, cash volumes have been steadily increasing, as investors bank their dividends and bring in cash from other sources in the hope of finding bargains. It is apparent many are expecting – or hoping for – further moderations in share prices to top up their portfolios.

Macro economic and market news remains focussed on the potential fallout from a failure of Chinese property development behemoth Evergrande, energy crises in the UK and China, and Fed Chair Jerome Powell’s statements on monetary policy – with the raising of the US debt ceiling also adding to the ‘wall of worry’. Escalating commodity prices have also attracted significant attention, with investors concerned that supply chain constraints will result in higher inflation and force the hand of central banks in raising interest rates.

The big miners

At the other end of the scale, the iron ore price has bounced off its recent low, but remains nearly 50% below its 2021 peak, and few expect it to go higher. The pressure remains on Australia’s iron ore producers, with Fortescue Metals Group (FMG) down nearly 30% for the month of September. The stock remains nabtrade’s most traded share by value; although the overall trend is buying, smaller buys are often offset by larger sells. More than 50% of trades in the stock exceed $100,000, as it remains favoured by wealthier investors. BHP (BHP) is consistently the second most traded stock on the platform, with a strong, more consistent buying trend across large and smaller investors. Rio Tinto (RIO) is also popular, but with larger sells and smaller buys, is a less consistent trade.

Sell off saw widespread buying

The sell off on Tuesday and Wednesday, widely flagged after falls on Wall Street, brought widespread buying among retail investors. For many without a strong view of which sectors or stocks were likely to outperform, exchange traded funds (ETFs) are an attractive and easy solution; this week brought heavy buying in Vanguard’s ASX200, diversified high growth and S&P500 options, as well as Betashares Nasdaq 100 ETF. ETFs have often featured in the top 10 during periods of volatility, as more investors seek to build portfolios without stock-specific risk.

The BNPL sector

The buy now, pay later sector, a favourite in recent years, has gone quiet following the Square (SQ.US) offer for Afterpay (APT), but Thursday saw a spike in volume in shares of the latter. While this could have been related to Zip Co’s (Z1P) announcement that it had signed an agreement with Microsoft to have Z1P’s payment offering integrated within Microsoft Edge, starting in the US, it is more likely to do with weakness in the Square share price, as the SQ offer is all scrip. Nabtrade investors were net sellers of Afterpay shares on Thursday at an average price of $121, well below the $130 price they had recently settled at. Z1P shares were also sold on a modest bounce; despite the Microsoft announcement, broker Jeffereys cut its price target to $7.43 and downgraded it to a hold from a buy. Z1P shares closed at $7.06.

Talking financials

Among financials, which has fallen from the most traded sector three years ago to an also-ran behind materials, Commonwealth Bank (CBA) has been a popular sell at $103, and an even more popular sell at $105 on Tuesday. As the rest of the big four bounced on Thursday, they were also trimmed.

Overseas buying

On international markets, investors remain buyers, despite concerns about the strength of recent performance and building risks in the global economy. A small number of investors have bucked the trend, selling down their holdings in vaccine manufacturer Moderna (MRNA), which has fallen from recent highs of $US496 to its recent price of $378. Despite the fall, the stock is up 66% over the last three months.