5 things to watch on the ASX 200 on Tuesday

It looks set to be a tough session for Aussie investors today.

A male ASX 200 broker wearing a blue shirt and black tie holds one hand to his chin with the other arm crossed across his body as he watches stock prices on a digital screen while deep in thought

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On Monday, the S&P/ASX 200 Index (ASX: XJO) started the week with a solid gain. The benchmark index rose 0.7% to 8,205.4 points.

Will the market be able to build on this on Tuesday? Here are five things to watch:

ASX 200 expected to fall

The Australian share market is expected to fall on Tuesday following a poor start to the week in the United States. According to the latest SPI futures, the ASX 200 is poised to open the day 11 points or 0.1% lower. In later trade on Wall Street, the Dow Jones is down 1%, the S&P 500 is down 0.9%, and the Nasdaq has fallen 1.1%.

TechnologyOne shares downgraded

The TechnologyOne Ltd (ASX: TNE) share price is fully valued now according to analysts at Goldman Sachs. This morning, the broker has downgraded the enterprise software provider's shares to a neutral rating with an improved price target of $24.05.  It said: "TNE has justifiably re-rated from 40x to 56x NTM P/E since its May-24 result, which validated that organic growth momentum is accelerating as the on-prem to cloud transition concludes. […] However, given TNE is now trading in line with high quality ASX TMT peers and GSe/VA Consensus are already sitting above FY24E PBT guidance (+17% vs +12-16% guidance), risk-reward appears fair with balanced risks to both the upside and downside."

Oil prices jump again

It could be a great session for ASX 200 energy shares Santos Ltd (ASX: STO) and Karoon Energy Ltd (ASX: KAR) on Tuesday after oil prices started the week strongly. According to Bloomberg, the WTI crude oil price is up 4% to US$77.33 a barrel and the Brent crude oil price is up 3.9% to US$81.14 a barrel. Rising tensions in the Middle East between Israel and Iran were behind the rise.

HMC named as a buy

HMC Capital Ltd (ASX: HMC) shares are in the buy zone according to analysts at Goldman Sachs. This morning, the broker has initiated coverage on the alternative asset manager's shares with a buy rating and $8.94 price target. It said: "We forecast a 13% 3-yr EPS CAGR over FY25-27E, driven primarily by revenue growth in annuity-style base management fees as HMC materially ramps up its FUM to >A$20 bn over the medium term from A$12.7 bn currently."

Gold price falls

ASX 200 gold miners Gold Road Resources Ltd (ASX: GOR) and Regis Resources Limited (ASX: RRL) could have a subdued session after the gold price edged lower overnight. According to CNBC, the gold futures price is down 0.3% to US$2,659.7 an ounce. Stronger US bond yields put pressure on the precious metal.

Motley Fool contributor James Mickleboro has positions in Technology One. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has positions in and has recommended Goldman Sachs Group and Technology One. The Motley Fool Australia has recommended Technology One. 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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