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5 things to watch on the ASX 200 on Wednesday

James Mickleboro

On Tuesday the S&P/ASX 200 index bounced back from a decline the previous day with a strong 0.8% gain to 6,742.8 points.

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

ASX 200 expected to sink.  

The Australian share market looks set to give back yesterday’s gains after a very bad night of trade on global markets. According to the latest SPI futures, the ASX 200 is poised to sink 79 points or 1.1% at the open. On Wall Street the Dow Jones fell 1.3%, the S&P 500 dropped 1.2%, and the Nasdaq index fell 1.1%.

Weak U.S. manufacturing data.

Global markets were sold off overnight after weak U.S. manufacturing data led to concerns over the U.S. economy. According to CNBC, the Institute for Supply Management said that U.S. manufacturing activity contracted to its worst level since June 2009. On Twitter President Trump placed the blame on the Federal Reserve, saying: “Jay Powell and the Federal Reserve have allowed the Dollar to get so strong, especially relative to ALL other currencies, that our manufacturers are being negatively affected.”

Oil prices slide.

Energy producers including Beach Energy Ltd (ASX: BPT) and Santos Ltd (ASX: STO) could drop lower today after oil prices weakened overnight. According to Bloomberg, the WTI crude oil price fell 0.3% to US$53.93 a barrel and the Brent crude oil price dropped to US$59.06 a barrel. The weak manufacturing data weighed on oil prices.

Gold price rebounds.

It looks set to be a positive day of trade for Australian gold miners including Newcrest Mining Limited (ASX: NCM) and Resolute Mining Limited (ASX: RSG) after the gold price rebounded from its two-month low overnight. According to CNBC, the spot gold price jumped 0.9% to US$1,486.40 an ounce amid the market selloff.

Dividends being paid.

A number of popular shares are paying shareholders their latest dividends today. These include iron ore producer Fortescue Metals Group Limited (ASX: FMG), mineral sands producer Iluka Resources Limited (ASX: ILU), and services company Downer EDI Limited (ASX: DOW).

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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The Motley Fool's purpose is to help the world invest, better. Click here now for your free subscription to Take Stock, The Motley Fool's free investing newsletter. Packed with stock ideas and investing advice, it is essential reading for anyone looking to build and grow their wealth in the years ahead. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson. 2019