S&P/ASX 200 to rebound: 5 shares to watch

The S&P/ASX 200 (Index: ^AJXO) (ASX: XJO) is expected to trade firmly higher following mixed leads from international markets overnight.

Here’s a recap:

  • Dow Jones (USA): up 1.41%
  • NASDAQ (USA): up 1.97%
  • FTSE 100 (UK): down 0.72%
  • DAX (Germany): down 1.67%
  • EURO STOXX 50 (Europe): down 1.6%
  • Shanghai Composite (China): up 1.97%

In the US, the Dow Jones rebounded into positive territory as the embattled energy sector led gains. After spending years at over $US100 a barrel, oil prices have slumped to below $US30 a barrel since mid-2014. A 2.3% jump in oil prices overnight, however, saw the USA’s energy sector rebound more than 4%.

In Europe, modest rebounds in commodity prices weren’t enough to overcome more concerns about the enormous automotive industry. A raid on Renault’s factories saw markets exposed to carmakers, such as Germany’s DAX and Paris’ CAC, fall more than 1.5%. FTSE-listed shares of BHP Billiton Limited (ASX: BHP) and Rio Tinto Limited (ASX: RIO) jumped 6% and 2.2%, respectively.

Closer to home, the Sydney Futures Exchange is tipping a 67-point, or 1.36%, rise in the S&P/ASX 200 at the open.

Following the modest rises in oil and iron ore prices, investors will be closely watching BHP, Rio Tinto, Fortescue Metals Group Limited (ASX: FMG), Woodside Petroleum Limited (ASX: WPL) and other major commodity producers’ share prices today. Both the energy and resources sectors have underperformed the broader market in 2016.

Australia’s largest iron ore miner, Rio Tinto, has frozen the salaries of all its employees and is urging staff to “cut back on all non-essential activities to preserve cash amid a protracted slump in commodity prices,” Dow Jones Newswires reported from London. Year-over-year, iron ore and copper prices have fallen 70% and 20%, respectively.

National Australia Bank Ltd. (ASX: NAB) updated the market regarding its proposed demerger and initial public offering (IPO) of the Clydesdale Yorkshire Banking Group. In a statement to the ASX, NAB said its UK subsidiary had been performing as expected over the past three months and it will continue to proceed with its proposed demerger, which will see the bank listed on both the ASX and London Stock Exchange.

Will the market CRASH in 2016?

With the ASX flirting with 5,000, some experts are predicting a market crash. Discover our Foolish experts' advice on what YOU should do in the event of a crisis -- simply click here for your FREE copy of our newly updated report, "What to Do When the Sharemarket Crashes". Click here, it's FREE!.

Motley Fool writer/analyst Owen Raszkiewicz has no position in any stocks mentioned.

Owen welcomes your feedback on Google plus (see below), LinkedIn or you can follow him on Twitter @ASXinvest.

Unless otherwise noted, the author does not have a position in any stocks mentioned by the author in the comments below. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

Two New Stock Picks Every Month!

Not to alarm you, but you’re about to miss a very important event! Chief Investment Advisor Scott Phillips and his team at Motley Fool Share Advisor are about to reveal their latest official stock recommendation. The premium “buy alert” will be unveiled to members and you can be among the first to act on the tip.

Don’t let this opportunity pass you by – this is your chance to get in early!

Simply enter your email now to find out how you can get instant access.

By clicking this button, you agree to our Terms of Service and Privacy Policy. We will use your email address only to keep you informed about updates to our website and about other products and services we think might interest you. You can unsubscribe from Take Stock at anytime. Please refer to our Financial Services Guide (FSG) for more information.