On Monday, the S&P/ASX 200 Index (ASX: XJO) started the week with a solid gain. The benchmark index rose 0.7% to 8,205.4 points.
Will the market be able to build on this on Tuesday? Here are five things to watch:
ASX 200 expected to fall
The Australian share market is expected to fall on Tuesday following a poor start to the week in the United States. According to the latest SPI futures, the ASX 200 is poised to open the day 11 points or 0.1% lower. In later trade on Wall Street, the Dow Jones is down 1%, the S&P 500 is down 0.9%, and the Nasdaq has fallen 1.1%.
TechnologyOne shares downgraded
The TechnologyOne Ltd (ASX: TNE) share price is fully valued now according to analysts at Goldman Sachs. This morning, the broker has downgraded the enterprise software provider's shares to a neutral rating with an improved price target of $24.05. It said: "TNE has justifiably re-rated from 40x to 56x NTM P/E since its May-24 result, which validated that organic growth momentum is accelerating as the on-prem to cloud transition concludes. […] However, given TNE is now trading in line with high quality ASX TMT peers and GSe/VA Consensus are already sitting above FY24E PBT guidance (+17% vs +12-16% guidance), risk-reward appears fair with balanced risks to both the upside and downside."
Oil prices jump again
It could be a great session for ASX 200 energy shares Santos Ltd (ASX: STO) and Karoon Energy Ltd (ASX: KAR) on Tuesday after oil prices started the week strongly. According to Bloomberg, the WTI crude oil price is up 4% to US$77.33 a barrel and the Brent crude oil price is up 3.9% to US$81.14 a barrel. Rising tensions in the Middle East between Israel and Iran were behind the rise.
HMC named as a buy
HMC Capital Ltd (ASX: HMC) shares are in the buy zone according to analysts at Goldman Sachs. This morning, the broker has initiated coverage on the alternative asset manager's shares with a buy rating and $8.94 price target. It said: "We forecast a 13% 3-yr EPS CAGR over FY25-27E, driven primarily by revenue growth in annuity-style base management fees as HMC materially ramps up its FUM to >A$20 bn over the medium term from A$12.7 bn currently."
Gold price falls
ASX 200 gold miners Gold Road Resources Ltd (ASX: GOR) and Regis Resources Limited (ASX: RRL) could have a subdued session after the gold price edged lower overnight. According to CNBC, the gold futures price is down 0.3% to US$2,659.7 an ounce. Stronger US bond yields put pressure on the precious metal.
