Home / Sector / Bank Shares / What’s moving the CBA share price higher this week?

What's moving the CBA share price higher this week?

Australia's banks are expected to reap higher profits as the RBA increases the official cash rate.

Posted by
Bernd Struben
Bernd Struben earned his economics degree in the US. Following several years writing about the tourism industry in the Caribbean, he moved to The Netherlands to cover the EU's booming commercial real estate markets. He moved to Australia in 2010, where he transitioned to analysing the Aussie equity markets. He employs a combination of macro economics and company specific data to gauge what he believes are tomorrow's best investments. In his free time, you're likely to find Bernd at the beach or dabbling away on a new work of science fiction.
Published
| More on:

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Key points
  • CBA share price in the green for the third positive trading day this week
  • The big bank could see a 15% boost in profits if the RBA moves on rates as expected
  • CommBank is investing heavily in digital innovation

The Commonwealth Bank of Australia (ASX: CBA) share price is marching higher today.

Shares in Australia's biggest bank closed yesterday at $103.80. Heading into the lunch hour, shares are trading for $104.89, up 1.1%.

This comes as the wider S&P/ASX 200 Index (ASX: XJO) recovers from yesterday's big sell-off, with the benchmark index also up 1.1%.

If the CBA share price finishes the day in the green today, that will mark three days of gains this week alongside two days of losses.

Despite slipping in Wednesday's and Thursday's trading sessions, CommBank is up 2.7% since Friday's closing bell, handily outpacing the 1.0% gain posted by the ASX 200.

A man in a suit smiles at the yellow piggy bank he holds in his hand.

Image source: Getty Images

Interest rates and digital innovation

This week, investors were tuned in to two factors that could impact the CBA share price.

Specifically related to CommBank, the company updated the market on Tuesday regarding its ongoing digital innovation initiatives, intended to draw in more customers and retain the ones it has.

Commenting on the bank's technology focus, CEO Matt Comyn said:

Driving digital innovation for our customers is core to our strategy. This is all about reimagining what it means to be a bank, and the ways in which a bank can anticipate and meet customer needs.

We seek to be the trusted centre of our customers' financial lives, using technology to build the best integrated and personalised digital experiences to suit all the ways our customers interact with us.

Investors may have also tuned into CommBank on news that its share price could receive some healthy tailwinds from rising interest rates.

As the Motley Fool reported on Wednesday, Australia's banks could be looking at a 15% lift in profits if the Reserve Bank of Australia (RBA) boosts the cash rate to 1.0%.

That's according to Bloomberg Intelligence analysts Matt Ingram and Jack Baxter.

According to the analysts:

Australian banks' profits may be up to 15% higher than consensus as soon as 1HFY23 with CBA and Westpac gaining the most if the December 2022 RBA cash rate hits 1% as forecast by Bloomberg Economics.

CBA share price snapshot

Over the past 12 months, the CBA share price is up 6.7%. That compares to a one-year gain of 1.6% posted by the ASX 200.

The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

More on Bank Shares

A man sits in deep thought with a pen held to his lips as he ponders his computer screen with a laptop open next to him on his desk in a home office environment.
Bank Shares

Here's why this top broker is tipping 27% upside for ANZ shares

| James Mickleboro

The Silicon Valley Bank collapse has weighed heavily on ANZ's shares and could have created a buying opportunity.

Read more »

A man holds his hand under his chin as he concentrates on his laptop screen and reads about the ANZ share price
Bank Shares

Is the Westpac share price a buy below $22?

| Bernd Struben

Westpac’s net interest margins could benefit from any further rate hikes by the RBA.

Read more »

Person with thumbs down and a red sad face poster covering the face.
Bank Shares

Why did the Bank of Queensland share price just hit a multi-year low?

| Sebastian Bowen

Bank of Queensland shares just went backwards by nearly two years.

Read more »

A man sits uncomfortably at his laptop computer in an outdoor location at a table with trees in the background as he clutches the back of his neck with a wincing look on his face.
Bank Shares

ASX 200 bank shares punished again on US bank fallout

| Bernd Struben

Investors in ASX 200 bank shares are jittery in the wake of SVB’s financial implosion last week.

Read more »

Confident male executive dressed in a dark blue suit leans against a doorway with his arms crossed in the corporate office
Bank Shares

ASX 200 bank shares: Are they better prepared than Silicon Valley Bank?

| Mitchell Lawler

How ready are our banks for a real life stress test?

Read more »

three reasons to buy asx shares represented by man in red jumper holding up three fingers
Bank Shares

3 reasons the 8% NAB dividend yield looks safe to me

| Tristan Harrison

The bank could keep paying a very good dividend.

Read more »

a small girl empties a piggy bank of coins onto a table while her mother looks on in the background.
Bank Shares

Here's how much I'd need to invest in Westpac shares to generate a $150 monthly income

| Sebastian Bowen

Here's how much income you can get from Westpac shares right now.

Read more »

a woman holds her hands to her temples as she sits in front of a computer screen with a concerned look on her face.
Bank Shares

Why are ASX 200 bank shares like CBA being annihilated today?

| James Mickleboro

It has not been a great day to be invested in the banking sector.

Read more »