On Monday the S&P/ASX 200 Index (ASX: XJO) was in sensational form and surged materially higher. The benchmark index jumped 2.6% to 5,941.6 points.
Will the market be able to build on this on Tuesday? Here are five things to watch:
ASX 200 expected to rise again.
The Australian share market looks set to continue its positive run on Tuesday. According to the latest SPI futures, the ASX 200 is expected to rise 29 points or 0.5% at the open. This follows a strong start to the week on Wall Street, which saw the Dow Jones rise 1.7%, the S&P 500 climb 1.8%, and the Nasdaq storm 2.25% higher. News that President Trump is being discharged from hospital helped drive markets higher.
Reserve Bank meeting.
This afternoon the Reserve Bank will hold its October meeting and make a decision on the cash rate. According to the latest cash rate futures, the market is currently pricing in a 67% probability of a rate cut at the meeting. A number of economists are tipping the Reserve Bank to make a partial cut from 0.25% down to 0.1%.
Oil prices rebound strongly.
Energy shares such as Santos Ltd (ASX: STO) and Woodside Petroleum Limited (ASX: WPL) could be on the rise today after oil prices rebounded strongly. According to Bloomberg, the WTI crude oil price is up 6.2% to US$39.37 a barrel and the Brent crude oil price is up 5.6% to US$41.48 a barrel. Stimulus hopes helped drive oil prices higher.
Gold price rises.
The shares of Newcrest Mining Limited (ASX: NCM) and St Barbara Ltd (ASX: SBM) will be on watch today after the gold price pushed higher. According to CNBC, the spot gold price has climbed 0.55% to US$1,918.20 an ounce. This was driven by a combination of COVID-19 stimulus hopes and a weakening U.S. dollar.
Tonight Josh Frydenberg will be handing down the Federal Budget. The government will be making this a budget focused on creating jobs and driving Australia out of its recession. One major policy will be the bringing forward of personal tax cuts from 2022 and backdated to July. Investors may want to keep an eye out for further policy announcements that may be drip fed to the media during the day.