A challenging start to the week is anticipated for Australian investors. On Friday, the S&P/ASX 200 Index (ASX: XJO) ended the week with a notable decline, falling by 2.1% to close at 7,943.2 points. Investors are now looking to see how the market will perform on Monday. Here are five key factors to monitor:
ASX 200 Expected to Decline Further The Australian share market is anticipated to experience further declines on Monday, following a significant selloff on Wall Street last Friday. The latest SPI futures indicate that the ASX 200 could open approximately 115 points, or 1.5% lower. In the United States, major indices also faced losses: the Dow Jones Industrial Average dropped by 1.5%, the S&P 500 fell by 1.85%, and the Nasdaq Composite decreased by 2.4%. These declines were influenced by weak economic data and growing recession concerns, which have exerted downward pressure on stocks.
Oil Prices Drop Energy stocks within the ASX 200, such as Santos Ltd (ASX: STO) and Woodside Energy Group Ltd (ASX: WDS), may face a tough start to the week due to falling oil prices. On Friday, WTI crude oil prices decreased by 3.7% to $73.52 per barrel, while Brent crude oil prices fell by 3.4% to $76.81 per barrel. The decline in oil prices was driven by concerns regarding the U.S. economy, which contributed to the downward trend.
Impact on Gold Shares Gold shares within the ASX 200, including Newmont Corporation (ASX: NEM) and Northern Star Resources Ltd (ASX: ASX:NST), might experience a subdued start to the week following a drop in gold prices. On Friday, the spot gold price slipped by 0.45%, settling at $2,469.80 per ounce. The decrease was attributed to profit-taking by traders after recent strong gains in the gold market.
Sector-Specific Updates For investors focusing on specific sectors, the data center industry and retail sector may present notable opportunities. Nextdc Ltd (ASX: NXT), a data center operator, is expected to report strong results this month, supported by favorable industry feedback. The company is perceived as a leading provider in the Australian market, with expectations of solid performance.
In the retail sector, Super Retail Group Ltd (ASX: SUL) is also highlighted as a notable stock to watch. The company is projected to report slightly better-than-expected earnings before interest and taxes (EBIT) for FY24. The performance of Super Retail’s brands, such as Rebel and BCF, will be closely watched, with initial trading updates for FY25 expected to play a crucial role in stock performance.
Australian investors should prepare for a challenging start to the week, with potential declines in the ASX 200, fluctuations in oil and gold prices, and sector-specific developments influencing market dynamics.