On Wednesday the S&P/ASX 200 Index (ASX: XJO) was out of form and dropped lower. The benchmark index fell 0.5% to 6,795.2 points.
Will the market be able to bounce back from this on Thursday? Here are five things to watch:
ASX 200 futures pointing higher
The Australian share market looks set to push higher on Thursday morning following a positive night of trade on Wall Street. According to the latest SPI futures, the ASX 200 is poised to open the day 5 points or 0.1% higher this morning. In late trade on Wall Street, the Dow Jones is up 0.55%, the S&P 500 has risen 0.3%, and the Nasdaq is up 0.55%.
US Fed keeps rates on hold
The US Federal Reserve has sharply increased its expectations for economic growth but indicated that there will be no interest rate hikes until 2023 despite this and higher inflation. According to CNBC, the committee also voted to keep short-term borrowing rates steady near zero and will buy at least US$120 billion of bonds a month.
Oil prices drop
Energy producers such as Beach Energy Ltd (ASX: BPT) and Woodside Petroleum Limited (ASX: WPL) could underperform today after oil prices dropped. According to Bloomberg, the WTI crude oil price is down 0.25% to US$64.64 a barrel and the Brent crude oil price has fallen 0.45% to US$68.08 a barrel. This was the fourth session in a row of declines. Traders were selling oil due to rising US inventories.
Gold price surges higher
Gold miners Newcrest Mining Ltd (ASX: NCM) and Resolute Mining Limited (ASX: RSG) could be on the rise today after the gold price surged higher. According to CNBC, the spot gold price is up 1.05% to US$1,749.00 an ounce. The gold price climbed after the US Fed committed to not increasing rates until 2023.
Afterpay rated neutral
A note out of Goldman Sachs reveals that its analysts have held firm with their neutral rating and $127.60 price target on Afterpay Ltd (ASX: APT) shares following a deep dive into the buy now pay later sector. Goldman spoke very positively about the company, but continues to struggle with its valuation. It commented: "we believe relatively few players will dominate this sector in each market and flag that APT is showing the operational signs of being one of the key winners in this space (strong customer growth, merchant pipeline and frequency of use trends). […] However, valuation keeps us as Neutral."
