On Wednesday, the S&P/ASX 200 Index (ASX: XJO) was out of form and dropped into the red. The benchmark index fell 0.4% to 9,127.8 points.

Will the market be able to bounce back from this on Thursday? Here are five things to watch:

ASX 200 expected to edge lower

It looks set to be a soft session for Australian investors on Thursday following a subdued night on Wall Street. According to the latest SPI futures, the ASX 200 is expected to open the day 4 points lower this morning. In the United States, the Dow Jones fell 0.2%, the S&P 500 was a fraction lower, and the Nasdaq edged 0.1% lower.

ASX 200 result releases

Earnings season continues on Thursday with another group of ASX 200 shares due to release their results. This includes Bunnings owner Wesfarmers Ltd (ASX: WES), airline operator Qantas Airways Ltd (ASX: QAN), mining and mining services company Mineral Resources Ltd (ASX: MIN), diversified miner South32 Ltd (ASX: S32), and fund manager Magellan Financial Group Ltd (ASX: MFG).

Oil prices fall

ASX 200 energy shares Woodside Energy Group Ltd (ASX: WDS) and Santos Ltd (ASX: STO) could have a subdued session after oil prices fell overnight. According to Bloomberg, the WTI crude oil price is down 0.6% to US$81.89 a barrel and the Brent crude oil price is down 1.3% to US$87.45 a barrel. This was driven by positive developments in the Middle East.

Buy DroneShield shares

DroneShield Ltd (ASX: DRO) shares are in the buy zone according to analysts at Bell Potter. This morning, in response to the counter-drone technology company’s half-year results, the broker has retained its buy rating with a trimmed price target of $2.40. It said: “We expect RFRecon and new high-moat next gen products to drive continued contract wins, particularly from Europe where DRO has a leading presence in the CUAS EW vertical. Top end of CY26 revenue guidance looks achievable. Retain Buy.”

Gold price falls

It could be a poor session for ASX 200 gold shares such as Newmont Corporation (ASX: NEM) and Northern Star Resources Ltd (ASX: NST) on Thursday after the gold price fell overnight. According to CNBC, the gold futures price is down 1% to US$4,647.8 an ounce. Traders were selling the precious metal following the release of US inflation data.

The post 5 things to watch on the ASX 200 on Thursday appeared first on The Motley Fool Australia.

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Motley Fool contributor James Mickleboro has positions in Woodside Energy Group Ltd. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended DroneShield and Wesfarmers. The Motley Fool Australia has recommended Wesfarmers. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

While the Rio Tinto Ltd (ASX: RIO) share price has bounced around over the last few years, the dividend yield has remained attractive.

Dividends aren’t guaranteed, but the company usually tries to pay investors a sizeable payout with a rewarding dividend payout ratio.

Rio Tinto’s earnings aren’t as volatile as they used to be thanks to its diversified commodities strategy. It has significantly increased its exposure to copper, built a presence in lithium and continued its strong performance with Australian iron ore. Plus, it’s part of a massive iron ore project in Africa called Simandou.

Let’s take a look at what the dividend yield is at the current Rio Tinto share price.

Potential dividend for FY26

The business is projected to deliver a larger dividend payout for shareholders for the 2026 financial year.

Rio Tinto’s FY26 half-year result included a number of impressive growth numbers. Revenue rose 15% to US$31 billion, 28% growth of underlying operating profit (EBITDA) to US$14.8 billion, underlying earnings growth of 43% to US$6.85 billion, net profit growth of 47% to US$6.7 billion and free cash flow growth of 75% to US$3.8 billion.

All of those growth numbers allowed the business to increase its interim payout by 43% to US$2.11 per share.

Based on the dividend projection on Commsec, the business could pay a dividend yield of 3.7% excluding franking credits and 5.3% including franking credits.

That’s certainly not the largest dividend yield the business has had in the last few years.

The Rio Tinto share price has risen by 55% over the past year, which has dramatically impacted the dividend yield on offer. When the share price rises by 10%, the dividend yield is reduced by a tenth, so the huge rise for the ASX mining share isn’t helpful for prospective investors.

Is the Rio Tinto share price a buy?

The company had a very strong period in the first six months of 2026, which may make it seem appealing.

However, mining companies can be very cyclical because of how significantly resource prices can change and how much that can affect earnings due to the operating leverage, both positively and negatively.

If I were choosing when the right time is to invest in Rio Tinto shares, I wouldn’t necessarily choose a period of strength to invest. The best buying price usually appears when commodity prices are beaten down.

But, its exposure to copper and lithium is certainly paying off for the business with strengthening prices for both of those commodities. I think Rio Tinto’s earnings are on a good trajectory for the long-term.

According to Commsec, there are currently 15 ratings on the business, with seven of those being a buy and eight being a hold. While it’s been a good run for existing shareholders, I think future investors are more likely to achieve market-beating returns by waiting for a lower valuation. I’d look at other ideas today.

The post Is the Rio Tinto share price a buy for its 5% dividend yield? appeared first on The Motley Fool Australia.

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Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Xero Ltd (ASX: XRO) shares are having quite the year. The ASX tech stock is down 5% to $84.26 on Wednesday, but that’s after a stunning 33% gain over the past month. Over 12 months, however, Xero shares remain down 49%.

So, what’s behind the wild ride?

Xero shares stage a dramatic rebound

Xero shares suffered a major sell-off late last year that continued into early 2026. Like much of the technology sector, the company was caught up in a broad market sell-off after investors questioned whether some tech stocks had run too far following the sector-wide rally of late 2025.

The result was painful for Xero shareholders. The shares fell as low as $61.58 in late July — around a seven-year low. Since then, however, they’ve staged a remarkable recovery.

At the time of writing, Xero shares have rebounded around 38% from that low. They’re also up 33% over the past month, although they remain down 26% year to date.

That volatility raises an obvious question: has the market become too pessimistic about Xero’s long-term growth prospects?

Xero has a huge global opportunity

Australia and New Zealand provided Xero shares with its foundation, while the UK has developed into another substantial market.

The company finished FY26 with 4.92 million customers globally.

That’s an impressive customer base for a company that began in New Zealand less than two decades ago. Yet Xero estimates its total addressable market at around 100 million small and medium-sized businesses worldwide.

The United States could therefore be crucial to Xero’s next phase of growth. The company had approximately 424,000 US customers at the end of FY26, giving it plenty of room to expand in one of management’s three most important markets.

AI could add another growth engine

Xero’s proposition has also expanded significantly. The combination of accounting, payments and payroll gives customers more reasons to stay within the Xero ecosystem.

Accounting software can also be highly sticky because businesses may find it increasingly inconvenient to move their financial information, invoicing and payroll processes elsewhere. That stickiness can support recurring revenue, retention and opportunities to increase customer spending over time.

Xero is also developing JAX, its artificial intelligence platform, to automate more financial tasks and help customers make better decisions using the data already sitting inside the platform.

There are risks linked to Xero shares, of course. Xero faces formidable competition in the US, while successfully integrating Melio, a US bill pay platform, will be crucial.

Are Xero shares a buy?

TradingView data shows five of seven analysts currently have a buy or strong buy rating on Xero shares.

The average $113.33 price target implies potential upside of around 34% from $84.56. The most bullish target sits at $149.44, suggesting potential upside of approximately 77%.

After such a dramatic rebound, Xero shares clearly aren’t without risk. But with millions of customers, a huge global addressable market and an expanding AI-powered product ecosystem, the recent volatility may be giving investors another look at the long-term opportunity.

The post What on earth’s going on with Xero shares? appeared first on The Motley Fool Australia.

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Motley Fool contributor Marc Van Dinther has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Xero. The Motley Fool Australia has positions in and has recommended Xero. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.