5 things you need to know about the Australian sharemarket today

S&P/ASX 200 opens 0.4% higher despite Wall Street falling overnight

Mike King

Mike King is a Fool.com.au Investment Analyst and Writer. He caught the investing bug more than a decade ago, at a time when the U.S. had invaded Iraq and fear reigned in the markets. His initial success as the markets took off encouraged his passion and thirst for knowledge. With 13 years behind him at one of Australia's largest domestic banks, Mike's passion for stocks led him to join a boutique funds management firm, where he stayed for four years. A seven-year stint in equity research at one of the largest investment banks in the world followed that, giving Mike a thirst to pursue his passion further. Mike holds a Diploma in Applied Finance and Investment and a Graduate Certificate in Financial Planning. His passion is to help retail investors invest better, and that passion was one of his primary reasons for joining The Motley Fool Australia in late 2011. Mike has written thousands of articles since joining, including for Fairfax Media, Yahoo!7, Ninemsn and has also appeared on ABC's The Business. You can see all of Mikes' holdings here

Published May 12, 2015 10:10 am AEST

Welcome to Tuesday. Here are the five things I'm looking at today on the Australian sharemarket.

The S&P/ ASX 200 (Index: ^AXJO) (ASX: XJO) has opened 0.4% higher as Wall Street slipped overnight.The Dow Jones dropped 0.5%, as did the broader S&P 500, while the tech-heavy NASDAQ lost 0.2%.
Oil prices fell with Brent Crude Oil down 0.7% to US$64.91 per barrel while WTI Crude fell 0.2% to US$59.28 per barrel. (WTI stands for West Texas Intermediate and is the benchmark oil price in the US while the Brent crude oil price is more widely used in Europe.)

Iron ore prices jumped overnight, rising 2.6% to US$63.02 per tonne.

The Australian dollar has sunk against the US dollar and is currently buying 78.9 US cents.
Investment bank Goldman Sachs says it's time "to bet against iron ore", according to the Australian Financial Review. Analysts noted to clients, "market fundamentals will reassert themselves sooner rather than later," forecasting an average price of US$52 per tonne this year.That's around US$11 less than the current price. The investment bank says demand is lacklustre while supply continues to grow and the upshot must be for the higher-cost mines to close, before the commodity can achieve sustainable prices.
If you're taking a punt on the likes of Fortescue Metals Group Limited (ASX: FMG), look out, you might get burnt.
Australian retailers like Harvey Norman Holdings Limited (ASX: HVN) and JB HI-Fi Limited (ASX: JBH) could be big winners in tonight's budget, with expectations that GST will be imposed on downloads and digital purchases. Harvey Norman's Gerry Harvey has been campaigning for the move for years, so I'm sure he'll be delighted.
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