Good morning! Stock market futures today forecast a 59-point decrease from Friday's close on concerns about growth in Japan and a lackluster oil price forecast. On Friday, the Dow Jones and the S&P 500 both hit record highs, fueled by a stronger-than-expected jobs report.
What to watch today: Investors will keep an eye on oil prices after Morgan Stanley (NYSE: MS) slashed its oil forecast through the year 2019. The investment bank predicted that the global energy markets would hit its oversupply peak in the second quarter of 2015, fueled by OPEC's decision not to reduce production. The news should have a major impact on multinational suppliers and regional producers in the U.S. that have higher-than-average production costs.
Here's the other stock market news you need today - including your "Money MorningTip of the Day" - to make it a profitable Monday:
Oil Prices Today: Oil slumped again this morning on news that many analysts expect oversupply to last well into 2015. Saudi Arabia, OPEC's largest supplier, refuses to slash production or forfeit market share. This morning, January 2015 futures for U.S. crude slipped to $64.51 per barrel. Meanwhile, Brent crude retreated again to $67.14 per barrel.
Merger Mania: Shares of Cubist Pharmaceuticals (Nasdaq: CBST) rose more than 35% this morning on news that it will be acquired by Merck & Co. Inc. (NYSE: MRK) for $102 per share. The all-cash deal is anticipated to be worth roughly $9.5 billion after assumption of debt.
Flying High: Shares of Southwest AirlinesCo. (NYSE: LUV) were up more than 1.1% this morning on news that Goldman Sachs Group Inc. (NYSE: GS) upgraded the airline stock to a "Buy." A research note suggests that Southwest is likely to outperform its peers, which is significant considering that airline stocks have received a strong boost from declining energy prices. The airline was the largest recipient of short interest during the month of November.
Not Lovin' It: Shares of McDonald's Corp. (NYSE: MCD) slumped more than 2.5% this morning on news that same-store sales continue to slide. The global fast-food giant announced that November sales fell by more than 2.2%. One of the issues for MCD is a strong U.S. dollar. The company also pointed to continued fallout from the Chinese supplier issue as having dramatically impacted the company's brand reputation.
New Deal: Just hours after one company walked away from the other, CBS Corp. (NYSE: CBS) and Dish Network Corp. (Nasdaq: DISH) reached an 11th hour deal to cooperate. Over the weekend, CBS yanked its programming off the satellite provider's menu of programming options. However, the two companies reached a multi-year content deal, which ensures that CBS and its multiple channels will remain parts of the viewing options.
Economic Calendar: Today's economic calendar features a speech from Federal Reserve official Dennis Lockhart and the TD Ameritrade IMX.
Earnings Reports: Stay tuned for earnings reports from Vail Resorts Inc. (NYSE: MTN), Diamond Foods Inc. (Nasdaq: DMND), H&R Block Inc. (NYSE: HRB), ABM Industries Inc. (NYSE: ABM)
Full U.S. Economic Calendar Dec. 8, 2014
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.
TD Ameritrade IMX at 12:30 p.m.
Atlanta Federal Reserve Bank President Dennis Lockhart speaks 12:30 p.m.
Money MorningTip of the Day: The Saudis are very frustrated they're losing control over the pricing power they've held for decades. So, they're fighting back the only way they know how- by starting a price war with the United States. But our Chief Investment Strategist Keith Fitz-Gerald says they have made the biggest strategic "pricing error" in the kingdom's history. And, in doing so, they've actually cleared the way for America's shale energy boom and opened up a killer opportunity for this month's recommendation in particular.
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.
