On Tuesday the S&P/ASX 200 Index (ASX: XJO) was in sensational form and surged notably higher. The benchmark index jumped 2.6% to 6,156.3 points.
Will the market be able to build on this on Wednesday? Here are five things to watch:
ASX 200 expected to give back some gains.
The ASX 200 index looks set to give back some of its gains on Wednesday. According to the latest SPI futures, the benchmark index is expected to open the day 62 points or 1% lower. This follows a mixed night of trade on Wall Street which saw the Dow Jones climb 0.6% higher, the S&P 500 rise 0.2%, and the Nasdaq drop 0.8%.
Tech shares on watch… again.
Tech shares such as Altium Limited (ASX: ALU) and Appen Ltd (ASX: APX) were exceptionally strong performers on Tuesday after following the lead of their U.S. counterparts. However, it looks likely that they may give back some of these gains on Wednesday after major tech companies on the Nasdaq index tumbled lower overnight. Profit taking put pressure on the likes of Facebook, Amazon, and Apple.
Oil prices jump.
It looks set to be a positive day for energy producers such as Oil Search Limited (ASX: OSH) and Woodside Petroleum Limited (ASX: WPL) on Wednesday after oil prices jumped higher. According to Bloomberg, the WTI crude oil price rose 2.3% to US$41.76 a barrel and the Brent crude oil price pushed 1.7% higher to US$44.01 a barrel. Coronavirus vaccine hopes gave oil prices a major lift.
Gold price storms higher.
Gold miners including Evolution Mining Ltd (ASX: EVN) and Saracen Mineral Holdings Limited (ASX: SAR) will be on watch on Wednesday after the gold price stormed higher. According to CNBC, the spot gold price rose 1.4% to US$1,842.80 an ounce after the U.S. dollar weakened further.
BHP rated as a buy.
Analysts at Goldman Sachs think the BHP Group Ltd (ASX: BHP) share price offers value for investors. This morning the broker has retained its buy rating and $38.80 price target on the mining giant’s shares. It likes the Big Australian due to its valuation, strong and improving free cash flow, high returning green/brownfield projects, and possible portfolio optimisation/assets sales.
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James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of Altium. The Motley Fool Australia owns shares of Appen Ltd. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.
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