On Monday, the S&P/ASX 200 Index (ASX: XJO) started the week in a disappointing fashion. The benchmark index fell 0.5% to 7,139.5 points.
Will the market be able to bounce back from this on Tuesday? Here are five things to watch:
ASX 200 expected to sink again
The Australian share market looks set to continue its decline on Tuesday. According to the latest SPI futures, the ASX 200 is expected to open the day 173 points or 2.45% lower this morning. This follows a very poor start to the week on Wall Street, which in late trade sees the Dow Jones down 1.8%, the S&P 500 down 2.1%, and the Nasdaq down 2%.
Fortescue’s quarterly update
The Fortescue Metals Group Limited (ASX: FMG) share price will be on watch today when it releases its quarter update. All eyes will be on the mining giant’s costs and the discount its low grade product is being sold for compared to the benchmark iron ore price. In respect to the latter, Goldman Sachs sees price realisations dropping to 68% from 73% in the previous quarter.
Oil prices fall
Energy producers such as Beach Energy Ltd (ASX: BPT) and Woodside Petroleum Limited (ASX: WPL) could have a difficult day after oil prices pulled back. According to Bloomberg, the WTI crude oil price is down 2.2% to US$83.30 a barrel and the Brent crude oil price has fallen 1.8% to US$86.28 a barrel. A stronger dollar weighed on prices.
Gold price edges higher
Gold miners Evolution Mining Ltd (ASX: EVN) and Northern Star Resources Ltd (ASX: NST) could have a better day after the gold price edged higher. According to CNBC, the spot gold price is up 0.5% to US$1,839.90 an ounce. This appears to have been driven by demand for safe haven assets amid tensions in Ukraine and market volatility.
South32 shares rated as a buy
The South32 Ltd (ASX: S32) share price remains a conviction buy with an improved price target of $4.90 according to the team at Goldman Sachs. This follows the release of its quarterly update on Monday. While Goldman was slightly disappointed with its higher costs, it notes that this was offset by higher prices.