On Tuesday, the S&P/ASX 200 Index (ASX: XJO) was on form again and charged higher. The benchmark index rose 0.65% to 7,009.7 points.
Will the market be able to build on this on Wednesday? Here are five things to watch:
ASX 200 expected to sink
The Australian share market looks set to have a day to forget on Wednesday after Wall Street had its worst session since June 2020. According to the latest SPI futures, the ASX 200 is expected to open the day a massive 162 points or 2.3% lower this morning. On Wall Street, the Dow Jones fell 3.9%, the S&P 500 dropped 4.3%, and the Nasdaq sank 5.2%. Investors were panic selling after US inflation failed to cool.
Oil prices fall
Energy producers Beach Energy Ltd (ASX: BPT) and Woodside Energy Group Ltd (ASX: WDS) could have a subdued day after oil prices fell overnight. According to Bloomberg, the WTI crude oil price is down 0.2% to US$87.60 a barrel and the Brent crude oil price has fallen 0.55% to US$93.45 a barrel. Traders were selling oil following the release of disappointing US economic data.
Coles downgraded to sell
The Coles Group Ltd (ASX: COL) share price is overvalued according to analysts at Goldman Sachs. This morning the broker downgraded the supermarket giant's shares to a sell rating with a $15.60 price target. Goldman made the move due to Coles being a laggard in digital transformation, which it expects to result in market share losses. It also fears that its entrance into a high investment cycle will further pressure margins.
Gold price tumbles
Gold miners Evolution Mining Ltd (ASX: EVN) and Northern Star Resources Ltd (ASX: NST) could have a difficult day after the gold price tumbled lower overnight. According to CNBC, the spot gold price is down 1.55% to US$1,713.6 an ounce. Higher than expected inflation in the US has sparked fears of aggressive rate hikes.
ASX 200 shares going ex-dividend
A number of ASX 200 shares are due to trade ex-dividend this morning and could drop even more into the red. This includes appliance manufacturer Breville Group Ltd (ASX: BRG), horticulture company Costa Group Holdings Ltd (ASX: CGC), and fashion jewellery retailer Lovisa Holdings Ltd (ASX: LOV).
