On Wednesday the S&P/ASX 200 Index (ASX: XJO) was a very strong performer and surged higher. The benchmark index jumped 1% to 5,956.1 points thanks partly to the tech sector.
Will the market be able to build on this on Thursday? Here are five things to watch:
ASX 200 poised to edge lower.
The ASX 200 index looks set to drop lower on Thursday after a mixed night of trade on Wall Street. According to the latest SPI futures, the benchmark index is poised to open the day 9 points or 0.15% lower this morning. On Wall Street the Dow Jones rose 0.1%, the S&P 500 fell 0.45%, and the Nasdaq tumbled 1.2% lower.
US Federal Reserve keeps rates on hold.
As was largely expected, overnight the U.S. Federal Reserve voted to keep interest rates at zero in September. The central bank also indicated that this will remain the case for years to come. According to CNBC, Jon Hill, the senior fixed income strategist at BMO, thinks rates could be at zero until 2024. This could have some bearing on what the Reserve Bank does in the future.
Oil prices jump.
It could be a great day of trade for energy shares such as Beach Energy Ltd (ASX: BPT) and Woodside Petroleum Limited (ASX: WPL) on Thursday after oil prices jumped higher. According to Bloomberg, the WTI crude oil price is up 4.9% to US$40.16 a barrel and the Brent crude oil price is up 4.3% to US$42.28 a barrel. The catalyst for this was a pullback in oil inventories and production disruption caused by storms.
Tech shares on watch.
Australian tech stars such as Afterpay Ltd (ASX: APT) and Appen Ltd (ASX: APX) will be on watch after the Nasdaq’s recovery ran out of steam. The technology-focused index tumbled 1.2% lower overnight. As the local tech sector has a tendency to follow the Nasdaq’s lead, it could be a day in the red for our tech shares.
Gold price edges higher.
Gold miners including Evolution Mining Ltd (ASX: EVN) and Newcrest Mining Limited (ASX: NCM) will be on watch after the gold price edged higher. According to CNBC, the spot gold price is up slightly to US$1,967.50 an ounce. The precious metal barely even moved after the U.S. Federal Reserve suggested that rates will be low for years.
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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 AFTERPAY T FPO and 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.