On Friday, the S&P/ASX 200 Index (ASX: XJO) closed the week on a high note, rising 0.9% to 7,959.3 points. As the new week begins, investors are keen to see if the market can sustain this momentum. Here are five key things to watch on the ASX 200 on Monday:
- ASX 200 Expected to Rise Again
The Australian share market looks poised for another positive day following a strong finish on Wall Street. According to the latest SPI futures, the ASX 200 is anticipated to open 51 points or 0.6% higher on Monday. This optimism is supported by gains in the United States, where the Dow Jones increased by 0.6%, the S&P 500 rose by 0.55%, and the Nasdaq was up by 0.6%.
- Oil Prices Soften
Energy shares on the ASX 200, including Santos Ltd (ASX: STO) and Woodside Energy Group Ltd (ASX: WDS), may experience a subdued start to the week. On Friday, oil prices softened, snapping a four-week winning streak. According to Bloomberg, the WTI crude oil price fell 0.5% to US$82.21 a barrel, and the Brent crude oil price decreased by 0.4% to US$85.03 a barrel. This dip in oil prices could impact energy stocks on Monday.
- Sell ASX Ltd Shares
Goldman Sachs (NYSE:GS) has reiterated its sell rating on ASX Ltd (ASX: ASX) shares, suggesting they are overvalued. The broker has set a revised price target of $59.50, citing earnings upgrades reflecting recent operational trends. Goldman commented, "We maintain Sell on ASX relative to our coverage with a revised PT of $59.50 (earnings upgrades to reflect recent operational trends). ASX trades at 25x FY25 EPS – on the higher side vs global peers with D&A drag to result in muted medium-term profit growth." Investors should keep an eye on ASX Ltd shares as this could lead to selling pressure.
- Gold Price Edges Lower
ASX 200 gold shares, such as Newmont Corporation (ASX: NEM) and Northern Star Resources Ltd (ASX: ASX:NST), may face a soft start to the week as the gold price edged lower on Friday. According to CNBC, the spot gold price fell slightly to US$2,420.7 an ounce. Despite this decline, the gold price still recorded its third consecutive weekly gain on hopes for interest rate cuts. However, the minor dip might impact gold stocks on Monday.
- Zip (ASX:ZIP) Returns to the ASX 200 Index
Zip Co Ltd (ASX: ZIP) shares will be in the spotlight today after S&P Dow Jones Indices announced that the buy now, pay later provider will be added to the S&P/ASX 200 Index this month. This change comes in response to the removal of electronic design software provider Altium Limited (ASX: ALU), which is being acquired by Renesas Electronics Corporation. The inclusion of Zip in the benchmark index is set to take place on 22 July. Investors will be watching Zip closely to see how this development impacts its stock price.
As the week begins, these five factors will play a crucial role in shaping the performance of the ASX 200. Investors should stay informed and monitor these developments closely to make well-informed investment decisions.