On Monday, the S&P/ASX 200 Index (ASX: XJO) started the week with a solid gain. The benchmark index rose 0.5% to 8,252.8 points.
Will the market be able to build on this on Tuesday? Here are five things to watch:
ASX 200 expected to rise again
The Australian share market is expected to rise again on Tuesday following a positive start to the week in the United States. According to the latest SPI futures, the ASX 200 is poised to open the day 36 points or 0.4% higher. In late trade on Wall Street, the Dow Jones is up 0.5%, the S&P 500 is up 0.8%, and the Nasdaq is 1% higher.
A2 Milk shares downgraded
The A2 Milk Company Ltd (ASX: A2M) share price is fully valued now according to analysts at Bell Potter. This morning, the broker has downgraded the infant formula company's shares to a sell rating with a $6.10 price target. It said: "We downgrade from Hold to Sell. The recent share price rally, triggered by expectations of strong Chinese stimulus announcements sees A2M trade at 17.5x FY25e EBITDA, which represents a 115% premium to global IMF plays and 51% premium to Dairy FMCG plays."
Oil prices tumble
It could be a tough session for ASX 200 energy shares Santos Ltd (ASX: STO) and Karoon Energy Ltd (ASX: KAR) on Tuesday after oil prices tumbled overnight. According to Bloomberg, the WTI crude oil price is down 2.3% to US$73.86 a barrel and the Brent crude oil price is down 2% to US$77.46 a barrel. This was driven by OPEC cutting its demand forecasts.
Web Travel Group named as a buy
Web Travel Group Ltd (ASX: WEB) shares could be a buy according to analysts at Goldman Sachs. In response to a disappointing update on Monday, the broker has retained its buy rating and cut its price target by 18% to $6.70. It said: "Our valuation methodology is unchanged and trading at FY25e P/E of 18x vs FY24-27e EPS CAGR of 10.1%, which is still undemanding relative to our broader ANZ Consumer coverage."
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 dropped overnight. According to CNBC, the gold futures price is down 0.4% to US$2,666.7 an ounce. A stronger US dollar put pressure on the precious metal.
