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On Friday S&P/ASX 200 Index (ASX: XJO) ended the week with stunning gains. The basic index jumped by 1.75% to 6758.8 points.
Will the market be able to build on that on Monday? Here are five things to watch out for:
The ASX 200 is expected to sink
The Australian share market looks set to recapture most of Friday’s gains this morning after a horrendous end to the week on Wall Street. The ASX 200 is expected to open the day 102 points or 1.5% lower this morning, according to the latest SPI futures. On Wall Street, the Dow Jones fell 1.3%, the S&P 500 fell 2.4% and the NASDAQ fell 3.1%.
Oil prices are falling
Energy producers including Santos Ltd (ASX: STO) and Woodside Energy Group Ltd (ASX: WDS) could be off to a rough start to the week after oil prices fell on Friday night. According to Bloombergthe price of WTI oil fell by 3.9% to 85.61 US dollars per barrel, and the price of Brent oil fell by 3.1% to 91.63 US dollars per barrel. Fears of a global recession have once again weighed heavily on oil prices.
The Woolworths Group Ltd (ASX: WOW) Share prices will be in the spotlight today after the retail giant became the latest company to be hit by hackers. According to the release, compromised user credentials were used to gain unauthorized access to the customer relationship management systems of the recently acquired MyDeal business. An estimated 2.2 million customers were affected.
Fortescue is rated for sale
The Fortescue Metals Group Limited (ASX: FMG) share price is significantly overvalued, according to analysts at Goldman Sachs. The brokerage maintained a sell rating and a $13.40 price target on the mining giant’s stock this morning. This implies a decline of more than 20% over the next 12 months. Goldman said: “The shares are trading at a premium to BHP & RIO; c. 1.5x NAV compared to RIO and BHP at c. 0.8x and 1x NAV, c. 6x EBITDA (compared to RIO & BHP at around 3-5x) and c. 5% FCF compared to BHP and RIO at c. 5-10%”.
The price of gold falls sharply
Including gold diggers Newcrest Mining Limited (ASX: NCM) and Northern Star Resources Ltd (ASX: NST) could be off to a bad start to the week after the price of gold fell sharply on Friday. According to CNBC, the spot price of gold fell 1.7% during the session to 1,648.9 US dollars per ounce. A strong US dollar put pressure on the precious metal.