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5 things to watch on the ASX 200 on Tuesday

On Monday the S&P/ASX 200 Index (ASX: XJO) was able to shake off a poor start to the day and record a strong gain. The benchmark index stormed 1.4% higher to 5,319.8 points.

Will the market be able to build on this on Tuesday? Here are five things to watch:

ASX 200 expected to rise again.

It looks set to be another positive day for the ASX 200 on Tuesday. According to the latest SPI futures, the ASX 200 is expected to open the day 27 points or 0.5% higher this morning. This follows a positive start to the week on Wall Street which saw the Dow Jones rise 0.1%, the S&P 500 push 0.4% higher, and the Nasdaq index jump 1.2%. U.S. tech shares did a lot of the heavy lifting overnight.

Reserve Bank meeting.

This afternoon the Reserve Bank will hold its cash rate meeting for the month of May. According to the latest cash rate futures, the market is pricing in a 60% probability of a rate cut to zero at this meeting. However, the economics team at Westpac are expecting the central bank to keep rates on hold at 0.25%. In fact, the banking giant has forecast rates to stay on hold until at least the end of 2023.

Oil prices charge higher.

Energy shares such as Oil Search Limited (ASX: OSH) and Woodside Petroleum Limited (ASX: WPL) could be on the rise today after oil prices charged higher. According to Bloomberg, the WTI crude oil price is up 7.9% to US$21.37 a barrel and the Brent crude oil price is up 6.1% to US$28.05 a barrel. The easing of lockdowns is supporting the oil price.

Gold price higher.

Gold miners including Evolution Mining Ltd (ASX: EVN) and Northern Star Resources Ltd (ASX: NST) could push higher after a positive night for the gold price. According to CNBC, the spot gold price is up 0.65% to US$1,712.10 an ounce. Traders were buying gold amid rising U.S. and China tensions.

Westpac shares rated as neutral.

The Westpac Banking Corp (ASX: WBC) share price will be on watch today after analysts at Goldman Sachs retained their neutral rating on the banking giant’s shares. The broker was pleasantly surprised with Westpac’s net interest margin and has lifted its earnings forecasts to reflect this. This led to an increase in its price target to $18.12, which implies potential upside of 15% excluding dividends.

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Motley Fool contributor James Mickleboro owns shares of Westpac Banking. 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 Scott Phillips.

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