5 things to watch on the ASX 200 on Tuesday

On Monday, the S&P/ASX 200 Index (ASX: XJO) started the week in a positive fashion. The benchmark index rose 0.45% to 8,845.7 points.

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

ASX 200 expected to sink

The Australian share market looks set for a tough session on Tuesday following a mixed start to the week in the United States. According to the latest SPI futures, the ASX 200 is expected to open the day 77 points or 0.85% lower. On Wall Street, the Dow Jones fell 0.1%, but the S&P 500 rose 0.4% and the Nasdaq jumped 1.1%.

Sell New Hope shares

Bell Potter thinks New Hope Corporation Ltd (ASX: NHC) shares are overvalued. This morning, the broker has retained its sell rating on the coal miner's shares with an improved price target of $5.30. It said: "We maintain a Sell recommendation. Our $5.30/sh TP already incorporates a 15% premium to our sum-of-the-parts valuation, reflecting NHC's leverage to global energy security themes amplified by recent geopolitical tensions. We expect energy markets will normalise over the near-term. While the Malabar acquisition will materially strengthen NHC's long-term production outlook, Maxwell's longwall ramp-up to 5Mtpa saleable production brings elevated operational complexity over the medium-term."

Oil prices mixed

ASX 200 energy shares Beach Energy Ltd (ASX: BPT) and Santos Ltd (ASX: STO) will be on watch following a mixed night for oil prices. According to Bloomberg, the WTI crude oil price is up 2.25% to US$103.69 a barrel and the Brent crude oil price is down 0.45% to US$109.39 a barrel. Overnight there were more reports of Houthi attacks on Saudi infrastructure.

Sigma Healthcare shares downgraded

Sigma Healthcare Ltd (ASX: SIG) shares will be on watch on Tuesday after being hit with a broker downgrade. According to a note out of Bell Potter, it has downgraded the Chemist Warehouse owner's shares to a hold rating (from buy) with a steady price target of $3.00. It said: "The recent flight to safety away from tech is probably responsible for the rally in the SIG market price over recent weeks, nevertheless the stock remains expensive relative to growth outlook. In the absence of a significant upgrade, our recommendation is adjusted to Hold from Buy. PT is unchanged at $3.00."

Gold price falls

ASX 200 gold shares including Genesis Minerals Ltd (ASX: GMD) and Capricorn Metals Ltd (ASX: CMM) could have a subdued session on Tuesday after the gold price dropped overnight. According to CNBC, the gold futures price is down 0.5% to US$4,159.8 an ounce. Higher US Treasury yields weighed on the precious metal.

The post 5 things to watch on the ASX 200 on Tuesday appeared first on The Motley Fool Australia.

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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