On Tuesday the benchmark S&P/ASX 200 (Index: ^AXJO) (ASX: XJO) rebounded from Monday's heavy decline with a 0.2% gain to 6,013.6 points.
Will there be more gains on Wednesday? Here are five things that could shape today's trade:
ASX futures are pointing lower.
According to the latest SPI futures, the Australian share market is expected to open the day deep in the red. Futures currently point to a 47-point or 0.8% decline at the open following a tough night of trade on Wall Street. The Dow Jones Industrial Average fell 1.6%, the S&P 500 dropped 1.2%, and the Nasdaq was down 0.5%. Political turmoil in Italy is behind the decline.
Turmoil in Italy spooks markets.
After weeks of negotiations for a populist coalition government to take shape, the president of Italy has controversially vetoed it. This has left the country with an interim government before fresh elections take place early next year. There are concerns that the uncertainty that this has caused could lead to anti-EU parties winning even more votes if a fresh vote is held, sparking fears that Italy could follow the United Kingdom out of the European Union.
Cryptocurrency markets rebound.
The political turmoil in Italy has given cryptocurrency markets a much-needed boost. After a series of heavy declines, Bitcoin (BTC), Ethereum (ETH), and Ripple (XRP) all bounced back strongly during overnight trade just as markets started to crumble. This is because some traders see cryptocurrencies as the new gold and a safe haven asset. This will be good news for blockchain and crypto company Digitalx Ltd (ASX: DCC). Its shares have almost halved in value in the space of a month following the crypto meltdown.
Bank shares will be on watch.
The shares of Australia and New Zealand Banking Group (ASX: ANZ) and Commonwealth Bank of Australia (ASX: CBA) will be on watch today after heavy declines in the U.S. banking sector overnight. Concerns over a global credit blight and anaemic interest rates weighed on financial markets and led to many of the United States' major banks falling 3% or more.
Oil prices mixed.
Energy shares such as Beach Energy Ltd (ASX: BPT) and Oil Search Limited (ASX: OSH) will be under the spotlight again after a mixed night of trade for oil prices. According to Bloomberg, WTI crude has continued its decline and is down 1.5% to US$66.87 a barrel. Brent crude oil has edged 0.1% higher to US$75.38 a barrel.
