On Monday the S&P/ASX 200 index started the week on a subdued note. The benchmark index tumbled 0.4% to 6,903.7 points.
Will the local share market be able to bounce back from this on Tuesday? Here are five things to watch:
ASX 200 expected to rebound.
The S&P/ASX 200 index looks set to rebound from yesterday’s decline. According to the latest SPI futures, the ASX 200 is expected to rise 23 points or 0.35% at the open. This follows a positive night of trade on Wall Street. In late trade the Dow Jones is up 0.15%, the S&P 500 has climbed 0.55%, and the Nasdaq index has pushed 0.85% higher.
Tech shares could outperform.
It looks set to be a positive day for tech shares such as Appen Ltd (ASX: APX) and Nearmap Ltd (ASX: NEA). The local tech sector has a tendency to follow the lead of the technology-focused Nasdaq index. So with the Nasdaq pushing notably higher overnight, this bodes well for locally listed tech shares.
Oil prices continue their slide.
Energy shares including Oil Search Limited (ASX: OSH) and Woodside Petroleum Limited (ASX: WPL) could come under pressure today after oil prices weakened further. According to Bloomberg, the WTI crude oil price fell 1.7% to US$58.06 a barrel and the Brent crude oil price has dropped 1.2% to US$64.21 a barrel. Oil prices have fallen to five-week lows after Middle East tensions eased.
Gold price falls.
Evolution Mining Ltd (ASX: EVN), Saracen Mineral Holdings Limited (ASX: SAR), and the rest of the gold miners could drop lower today after the gold price softened. According to CNBC, the spot gold price fell 0.6% to US$1,551.20 an ounce after improving investor sentiment weighed on safe haven assets.
Sandfire Resources downgraded to sell.
The Sandfire Resources NL (ASX: SFR) share price will be on watch today after it was downgraded by analysts at Goldman Sachs. Although Goldman is bullish on copper, it is negative on Sandfire after reducing its net asset valuation due to lower returning development projects. Goldman Sachs has a sell rating and $5.20 price target on its shares.
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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Nearmap Ltd. The Motley Fool Australia owns shares of Appen Ltd. 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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