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What to watch today: expect a wealth of news about Japan's surprise slip in GDP growth. According to government data, the island nation saw its GDP slip by an annualized 1.7% in the third quarter. This is down from analyst expectations of 2.1% growth for the July to September period. Many economists expect Japanese Prime Minister Shinzo Abe to delay plans to hike the nation's sales tax, which is highly unpopular and restrains consumption. The quarterly decline follows a 7.2% contraction in the economy from the second quarter.
Here's what else you should know about the stock market today – including your "Money Morning Tip of the Day" – to make it a profitable Monday:
- Striking a Deal: Healthcare giant Pfizer Inc. (NYSE: PFE) announced a plan to manufacture cancer drugs with German rival Merck & Co. Inc. (NYSE: MRK). According to terms of the deal, Pfizer will pay an upfront fee to Merck worth $850 million. The deal could see Merck earn another $2 billion as the companies' efforts progress. This will likely end future speculation that Pfizer could purchase its international rival AstraZeneca Plc. (NYSE ADR: AZN).
- Merger Mania: According to reports, private pharmaceutical giant Actavis Plc. will announce a cash-and-stock mega-deal to buy Allergan Inc. (NYSE: AGN). The $65.5 billion deal – or $210 per share – would end months of speculation about a possible hostile takeover led by activist investor Bill Ackman. The high-profile investor had been working with Valeant Pharmaceuticals International Inc. (NYSE: VRX) to court the Botox manufacturer.
- Deal Is Off: According to reports, talks between Hasbro Inc. (NYSE: HAS) and DreamWorks Animation (NYSE: DWA) are fading about a possible deal. The deal would mark a significant move by Hasbro into the film and entertainment business. However, concerns about what the structure of the company would look like have stalled talks.
- Company Downtime: Social media giant Facebook Inc. (Nasdaq: FB) is developing a professional development website called Facebook at Work, according to a report in the Financial Times. The secret program is designed to allow users to separate their personal profiles from work profiles, and is aimed at competing against network giant LinkedIn Corp. (Nasdaq: LNKD).
- Another Big Score: The world's second-largest oil field services provider Halliburton Co. (NYSE: HAL) formally announced a $34.6 billion cash and stock deal to purchase rival Baker Hughes Inc. (NYSE: BHI). Shares of Halliburton slipped more than 3.5%, while Baker Hughes' stock jumped more than 16%.
- Economic Calendar: Today's economic calendar features the Empire State Manufacturing Survey and an update on Industrial Production.
- Earnings Reports: Stay tuned for earnings reports from Tyson Foods Inc. (NYSE: TSN), Urban Outfitters Inc. (Nasdaq: URBN), and JD.com Inc. (Nasdaq ADR: JD).
- Oil Prices Today: Global oil prices slid on news that Japan reported two consecutive quarters of economic contraction. Brent crude, the global benchmark priced in London, slipped by more than $1 per barrel. U.S. futures for WTI crude, which trades in New York City, slid another $0.75. Energy analysts are keeping a keen eye on OPEC leaders ahead of next week's meeting where they will discuss possible production cuts in the face of rising supplies and stagnant demand.
Full U.S. Economic Calendar Nov. 17, 2014
- Empire State Manufacturing Survey at 8:30 a.m.
- Industrial Production at 9:15 a.m.
- 4-Week Bill Announcement at 11 a.m.
- 3-Month Bill Auction at 11:30 a.m.
- 6-Month Bill Auction at 11:30 a.m.
About the Author
Garrett Baldwin is a globally recognized research economist, financial writer, and consultant with degrees from Northwestern, Johns Hopkins, Purdue, and Indiana University. He is a seasoned financial and political risk analyst, with a focus on stocks, hedge funds, private equity, blockchain, and housing policy. He has conducted risk assessment projects for clients in 27 countries, and consulted on policy and financial operations for some of the nation's largest financial institutions, including a $1.5 trillion credit fund, a $43 billion credit and auto loan giant, as well as two of the largest Wall Street banks by assets under management.
Garrett joined Money Map Press as an economist and researcher in 2011, specializing in alternative strategies with an emphasis on fundamental and technical analysis.