On Wednesday, the S&P/ASX 200 Index (ASX: XJO) experienced a lackluster session, falling by 0.1% to close at 7,963.7 points. The outlook for Thursday suggests a continuation of this trend, with several factors likely to impact the market.
ASX 200 Expected to Decline
The Australian share market is anticipated to face a downturn on Thursday, following a challenging night on Wall Street. SPI futures indicate that the ASX 200 might open 75 points or 0.95% lower. In the U.S., major indices suffered losses with the Dow Jones falling by 1.25%, the S&P 500 dropping 2.3%, and the Nasdaq declining 3.6%, driven by a tech selloff in response to disappointing results from prominent tech companies.
Oil Prices on the Rise
Energy stocks on the ASX 200, such as Beach Energy Ltd (ASX: ASX:BPT) and Woodside Energy Group Ltd (ASX: WDS), might perform better due to a recent increase in oil prices. WTI crude oil has risen by 0.7% to US$77.49 per barrel, while Brent crude oil is up 0.6% to US$81.51 per barrel. This rebound follows a decrease in U.S. oil inventories, potentially benefiting energy sector shares.
Pilbara Minerals Under Scrutiny
Pilbara Minerals Ltd (ASX: PLS) may face downward pressure following concerns about its valuation. Recent updates from the lithium producer have led to a revised price target of $2.40, down from $2.60. Analysts have noted that while production targets for FY25 are in line with expectations, unit costs are higher than anticipated, affecting profit margins.
Gold Price Softens
Gold shares on the ASX 200, including Newmont Corporation (ASX: NEM) and Northern Star Resources Ltd (ASX: ASX:NST), might see a muted session as the gold price has edged lower. The spot gold price decreased by 0.3% to US$2,400.8 per ounce, reflecting a broader selloff that impacted even traditionally safe-haven assets.
Fortescue’s Q4 Update
Fortescue Ltd (ASX: ASX:FMG) will be in the spotlight as it releases its fourth-quarter update. Analysts project iron ore shipments of 51.9 million tonnes for the quarter ending 30 June, which represents a 20% increase from the previous quarter. This forecast is slightly above the consensus estimate of 51.6 million tonnes, potentially influencing the company's stock performance.
These factors are likely to contribute to a challenging session for Australian investors, with movements in oil prices, gold, and specific stock updates playing a crucial role in shaping market sentiment.