On Monday, the S&P/ASX 200 Index (ASX: XJO) was back on form and started the week with a solid gain. The benchmark index rose 0.65% to 7,370.8 points.
Will the market be able to build on this on Tuesday? Here are five things to watch:
ASX 200 expected to edge lower
The Australian share market looks set to give back some of these gains on Melbourne Cup Day. According to the latest SPI futures, the ASX 200 is expected to open the day 7 points or 0.1% lower this morning. This follows a mixed start to the week on Wall Street which in late trades sees the Dow Jones up 0.1%, the S&P 500 down 0.1%, and the Nasdaq trading 0.3% higher.
Reserve Bank meeting
The Reserve Bank of Australia will be meeting today to discuss the cash rate. While the market is expecting the central bank to keep rates on hold at the current record low of 0.1%, it is also expected to signal the end of quantitative easing, scrap its yield target framework, and could bring forward its rate hike guidance.
Oil prices rise
Energy producers such as Beach Energy Ltd (ASX: BPT) and Woodside Petroleum Limited (ASX: WPL) could have a decent day after a solid night for oil prices. According to Bloomberg, the WTI crude oil price is up 0.55% to US$84.03 a barrel and the Brent crude oil price has risen 1.1% to US$84.63 a barrel. An improving demand outlook boosted prices.
Gold price rises
Gold miners Evolution Mining Ltd (ASX: EVN) and Northern Star Resources Ltd (ASX: NST) could rise today after the gold price pushed higher. According to CNBC, the spot gold price is up 0.5% to US$1,792.7 ounce. The precious metal appears to be trading in a narrow range ahead of the Federal Reserve meeting this week.
Westpac shares downgraded
The Westpac Banking Corp (ASX: WBC) share price will be on watch today after being downgraded by analysts at Goldman Sachs. This morning the broker downgraded the bank's shares to a neutral rating with a $25.60 price target. Goldman commented: "We revise our FY22/23/24E EPS by -6.0%/-9.1%/-9.5% driven by: i) a weaker NIM trajectory, ii) lower other operating income from asset sales and weaker markets, partly offset by iii) better performance on BDDs."
