Good morning! Dow futures for Monday, Dec. 1, forecasted a 66-point decrease from Friday's close. The Dow and the S&P 500 are forecasted to decline today after Moody's downgraded Japan's credit rating and as global commodity prices continue to fall.
Investors will keep a keen eye on global oil prices, which fell to a five-year low on news that the Organization of the Petroleum Exporting Countries (OPEC) will not slash production in the near future. Some analysts are projecting that oil prices could plummet even further. Gold and silver prices slipped again on news that voters in Switzerland have rejected a proposal on Sunday to increase the nation's gold reserves and that China's manufacturing sector is growing at a lower-than-expected pace. The HSBC manufacturing index, which measured China's production growth in November, slipped to a six-month low.
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:
- Feeding Frenzy: Cyber Monday is on tap today, which could be a boon for e-commerce giant Amazon.com Inc. (Nasdaq: AMZN). However, investors will be paying significant attention to retailer stocks after Black Friday, the largest shopping day of the year in the United States. According to the National Retail Federation, shopping revenues over the Thanksgiving holiday weekend slumped by 11.3% this year compared to the same time last year. Expect strong trading volumes from leading retailers like Wal-Mart Stores Inc. (NYSE: WMT), Best Buy Corp. (NYSE: BBY), and Target Corp. (NYSE: TGT), as all three stocks were down in pre-market hours.
- IPOs on Tap: 2014 has been a big year for initial public offerings, and the U.S. markets have two big ones on tap. Today, Avolon Holdings Ltd. will launch an IPO for its Irish aircraft-leasing firm. According to a report, the company is valued at roughly $1.8 billion. Meanwhile, Lending Club announced plans to offer 50 million shares in an IPO with a price range of $10 to $12.
- Oil Prices Today: Oil prices have fallen to five-year lows. Prices declined by 12% since Thursday when OPEC decided to maintain production levels in the face of increasing supplies. December futures for U.S. crude, priced at the NYMEX in New York City, dipped another 0.6% to fall near $65.77 per barrel. Meanwhile, Brent crude, priced in London, were down nearly 1% to fall below $70 per barrel. Overall, oil prices have fallen more than 40% since June.
- The Impact of Oil: Russia's economy continues to slide in the face of declining oil supplies and a cratering currency. The rouble, the nation's currency, slid more than 5% against the U.S. dollar this morning to a new record low. According to a new report from Société Générale, a sustained price decline of $20 would lead to a GDP slide for Russia's economy of roughly 1.8%. The U.S. dollar has appreciated against Russia's currency by more than 50% in 2014.
- Earnings Reports: Stay tuned for earnings reports from Fifth Street Finance Corp. (Nasdaq: FSC), Iao Kun Group Holding Co. Ltd. (Nasdaq: IKGH), Thor Industries Inc. (NYSE: THO), MOL Global Inc. (Nasdaq: MOLG).
- Economic Calendar: Today's economic calendar features speeches from two Federal Reserve members, an update on consumer spending, and the Global Manufacturing PMI.
Full U.S. Economic Calendar December 1, 2014:
- PMI Manufacturing Index at 9:45 a.m.
- ISM Manufacturing Index at 10 a.m.
- Global Manufacturing PMI at 11 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.
- New York Federal Reserve Bank President William Dudley speaks at 12:15 p.m.
- Gallup US Consumer Spending Measure at 1 p.m.
- Federal Reserve Vice Chair Stanley Fischer speaks at 1 p.m.
About the Author
Garrett Baldwin is a globally recognized research economist, financial writer, consultant, and political risk analyst with decades of trading experience and degrees in economics, cybersecurity, and business from Johns Hopkins, Purdue, Indiana University, and Northwestern.