On Friday the S&P/ASX 200 Index (ASX: XJO) finished a solid week in a positive fashion. The benchmark index rose 0.2% to 7,348.1 points.
Will the market be able to build on this on Monday? Here are five things to watch:
ASX 200 expected to sink
The Australian share market is expected to start the week in the red. According to the latest SPI futures, the ASX 200 is expected to open the day 37 points or 0.5% lower. This follows a poor end to the week on Wall Street, which saw the Dow Jones fall 0.85%, the S&P 500 drop 0.75%, and the Nasdaq tumble 0.8%.
Oil prices rise but are on watch
Energy producers such as Santos Ltd (ASX: STO) and Woodside Petroleum Limited (ASX: WPL) will be on watch today after oil prices pushed higher. According to Bloomberg, the WTI crude oil price is up 0.2% to US$71.81 a barrel and the Brent crude oil price has risen 0.15% to US$73.59 a barrel. However, news on Sunday that OPEC plans to completely end production cuts by September 2022 could weigh on prices once oil markets open again.
The SEEK Limited (ASX: SEK) share price could come under pressure today. This follows a broker note out of Goldman Sachs which reveals that its analysts have downgraded SEEK shares to a sell rating with an improved price target of $30.80. It made the move on an uncertain ad volume outlook and elevated valuation.
Gold price falls
Gold miners including Newcrest Mining Limited (ASX: NCM) and Northern Star Resources Ltd (ASX: NST) could come under pressure today after the gold price dropped on Friday night. According to CNBC, the spot gold price fell 0.8% to US$1,815 an ounce. The gold price retreated from a one-month high after the US dollar strengthened.
Rio Tinto upgraded to buy rating
The Rio Tinto Limited (ASX: RIO) share price could be great value according to analysts at Goldman Sachs. Although the mining giant fell short of its expectations in the fourth quarter, the broker has still upgraded its shares to a buy rating with a $144.40 price target. The broker made the move after adjusting its iron ore and free cash flow forecasts. Goldman believes this will allow double digit dividend yields for the next three financial years.