On Monday, the S&P/ASX 200 Index (ASX: XJO) started the week with a small gain. The benchmark index rose 0.3% to 7,381.5 points.
Will the market be able build on this on Tuesday? Here are five things to watch:
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ASX 200 expected to fall
The Australian share market looks set to give back yesterday's gains despite a positive start to the week on Wall Street. According to the latest SPI futures, the ASX 200 is poised to open the day 19 points or 0.25% lower. In the United States, a late rally saw the Dow Jones, S&P 500, and NASDAQ all close 0.3% higher. SPI futures may improve once these gains are fully reflected.
Oil prices drop
Energy shares Beach Energy Ltd (ASX: BPT) and Karoon Energy Ltd (ASX: KAR) could have tough session after oil prices tumbled overnight. According to Bloomberg, the WTI crude oil price is down 2% to US$80.96 a barrel and the Brent crude oil price is down 1.7% to US$84.85 a barrel. Oil prices fell on interest rate hike concerns.
Elders named as a buy
Goldman Sachs remains positive on Elders Ltd (ASX: ELD) shares and has reiterated its buy rating. And while the broker has taken the agribusiness company off its conviction list, its price target of $13.20 still implies over 60% upside. It said: "In our view the current valuation (10x P/E) has more than factored in any cyclical earnings impact and significantly undervalues the quality of the company."
Gold price softens
It could be a softer day for gold miners Evolution Mining Ltd (ASX: EVN) and Regis Resources Limited (ASX: RRL) after the gold price fell overnight. According to CNBC, the spot gold price is down 0.4% to US$2,007.4 an ounce. Traders have been reassessing their interest rate hike expectations.
Transurban Group rated as a sell
Goldman Sachs isn't feeling as positive about Transurban Group (ASX: TCL). This morning it retained its sell rating and $13.50 price target on the toll road operator's shares. Although it notes that the company is performing ahead of expectations in the second half, it believes that its "valuation still looks full."
