On Tuesday the S&P/ASX 200 index dropped notably lower after the trade war between the United States and China intensified. The benchmark index finished the day 0.9% lower at 6,239.9 points.
Will the market be able to bounce back on Wednesday? Here are five things to watch:
ASX futures pointing higher.
The Australian share market looks set to bounce back on Wednesday after the U.S. market rebounded overnight. According to the latest SPI futures, the ASX 200 is expected to open the day 25 points or 0.4% higher. On Wall Street the Dow Jones rose 0.8%, the S&P 500 climbed 0.8%, and the Nasdaq index pushed 1.1% higher.
Oil prices higher.
Australian oil producers including Oil Search Limited (ASX: OSH) and Santos Ltd (ASX: STO) are likely to push higher today after oil prices rose overnight. According to Bloomberg, the WTI crude oil price rose 0.6% to US$61.40 a barrel and the Brent crude oil price climbed 1% to US$70.96 a barrel. Oil prices pushed higher after a drone attack on a Saudi pipeline.
Tech shares could rebound.
Altium Limited (ASX: ALU) and WiseTech Global Ltd (ASX: WTC) shares could be on the rise on Wednesday after the U.S. tech sector rebounded overnight. Although Australia’s tech sector finished the day well off its lows, the S&P/ASX 200 Info Tech index finished the day a sizeable 1.15% lower and could rebound today.
Gold price higher.
The gold miners were amongst the best performers on the market on Tuesday due to the increased volatility. But the likes of Newcrest Mining Limited (ASX: NCM) and Resolute Mining Ltd (ASX: RSG) could come under pressure today after trade optimism improved investor sentiment and the U.S. dollar. According to CNBC, this led to the spot gold price falling 0.3% to US$1,297.50 an ounce.
Treasury Wine Estates rated as a sell.
The Treasury Wine Estates Ltd (ASX: TWE) share price will be on watch on Wednesday after Goldman Sachs retained its sell rating and $13.70 price target on the wine company’s shares. According to the note, Goldman’s research shows a significant decline in China wine imports and weakness in the United States during April. This price target implies downside of 9.5%.
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James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of Altium and WiseTech Global. The Motley Fool Australia owns shares of and has recommended Treasury Wine Estates Limited. 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.