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5 things to watch on the ASX on Monday

On Friday the benchmark S&P/ASX 200 (Index: ^AXJO) (ASX: XJO) finished the week with a day in red and was down 0.3% to 5,990.4 points.

Will the local market be able to start the week on a high? Here are five things that could shape the day’s trade:

ASX futures pointing higher.

According to the latest SPI futures, the Australian share market is expected to open the week 0.6% or 34 points higher following a positive end to the week on Wall Street. On Friday the Dow Jones Industrial Average was up 0.9%, the S&P 500 was 1.1% higher, and the NASDAQ finished the week with a 1.5% gain.

Strong jobs report in the United States.

The catalyst for the strong gains on Wall Street on Friday was the release of a better than expected jobs report. There were 223,000 jobs added to the U.S. economy in May, compared to expectations of 188,000. U.S. banks rose strongly on the news, as did the FAANG stocks. The latter collectively rose 2.5% on Friday, sending Apple shares to an all-time high.

Round three of the Royal Commission is complete.

On Friday a reasonably uneventful third round of the Royal Commission closed. The Commission will next reconvene for round four in three weeks with a focus on agribusiness. This could give the battered and bruised shares of Commonwealth Bank of Australia (ASX: CBA), Westpac Banking Corp (ASX: WBC), and the rest of the big four a bit of recovery time.

A2 Milk Company’s shares will be on watch.

The shares of A2 Milk Company Ltd (ASX: A2M) will be on watch on Monday after a heavy decline on Friday. The infant formula and dairy company’s shares came under pressure after the release of a broker note out of CLSA. It placed a sell rating on a2 Milk Company’s shares amid concerns over daigou pricing.

Oil prices slide lower.

The shares of energy producers including Beach Energy Ltd (ASX: BPT) and Senex Energy Ltd (ASX: SXY) could come under pressure on Monday after oil prices finished the week with a day in the red. According to Bloomberg, the price of WTI crude oil fell 1.8% to US$65.81 a barrel and Brent crude oil was off 1% to US$76.79 a barrel. The decline has been blamed on increased production.

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Motley Fool contributor James Mickleboro owns shares of Westpac Banking. The Motley Fool Australia owns shares of A2 Milk. 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 Scott Phillips.

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