The deepened resolve of OPEC to hold oil output at high levels will help keep the global oil glut in play until late into 2016, according to the International Energy Agency. Though Saudi Arabia and Iraq are already pumping oil at a near record pace, low-cost output from the region could increase even more after sanctions against Iran are lifted. Brent crude futures are down 1.59% to $39.10 in early trading, while WTI crude is 1.36% lower at $36.26. The energy sector will remain in focus all day with the IEA scheduled to release a key report on oil later today.
Economy
China's yuan traded at its lowest level in over four years as Beijing continues to let the currency devalue. The yuan fell to as low as 6.4515 to the dollar. Some economists think that the People's Bank of China will allow the yuan to float lower until the Federal Reserve meets next week.
U.S. retail sales will be released later this morning with economists expecting a month-over-month increase of 0.3%. Last month, the retail sales growth disappointed with a token 0.1% gain. This month's read on consumer spending is seen as critical with some analysts suggesting Black Friday sales were pulled forward into the early part of the month. One category expected to come in weak is sales of winter apparel due to the warm weather trend in the U.S.
Consumer prices in Germany rose 0.1% in November to remain below the medium-target inflation target range set by the European Central Bank. Inflation is only up 0.3% through the first eleven months of the year. Low prices in the energy sector have held down inflation in Germany.
Stocks
Where is Guo Guangchang? That question hangs over Fosun International (OTCPK:FOSUF) with media reports in China highlighting the disappearance of the company's co-founder and chairman. Guo was linked to a corruption case earlier this year. Shares of the trading unit of Fosun were halted amid the confusion. The company's official statement is that it is waiting to release "price-related volatile information" to the public. The intrigue around one of China's largest non-state owned conglomerates weighed on markets in China and Hong Kong today. The Shanghai Composite Index fell 0.6%.
Rabobank says it will eliminate 9K jobs by 2018 and slash €150B worth of assets from its balance sheet by 2020 in order to comply with Basel IV rules. The scheduled job eliminations mark just under 20% of Rabobank's workforce. The Dutch cooperative bank joins a long list of global banks slashing their workforce with harsh European banking regulations in mind.
Ford announced it will invest $4.5B in electric vehicle initiatives before 2020 in an effort to comply with federal fuel efficiency standards. The automaker's electric strategy will include adding 13 new EVs to its portfolio and moving to an electric-powered mix of over 40% of all vehicles by the end of the decade. New EV introductions from Ford (NYSE:F) could include hybrids, plug-hybrids, and pure electric vehicles.
Health officials in Seattle closed down a Chipotle (NYSE:CMG) store due to "repeated" food safety violations. The store has recently re-opened after being shut down following the E. coli outbreak which impacted some Chipotle stores in the Pacific Northwest. Separately, the toll of students at Boston College who became sick after eating at a Chipotle store has risen to 141. A notovirus is believed to have been the culprit in that case.
Sequenom has named Dirk van den Boom as its new CEO. The exec was serving as the interim CEO at the company. Dr. van den Boom will also keep his seat on Sequenom's (NASDAQ:SQNM) board. Shares of Sequenom are down over 20% this month.
Wal-Mart marketing chief Stephen Quinn will step down in January. Quinn has been at Wal-Mart (NYSE:WMT) since 2005. The company is expected to hire former top Target (NYSE:TGT) marketing exec Michael Francis as a consultant to aid its marketing efforts. Francis is known for helping to create the "Tarjay" image in a successful run at the retailer.
JetBlue fell in after-hours trading after reporting on November traffic. Revenue passenger miles rose 14.2% Y/Y in November to 3.4B, while JetBlue's (NASDAQ:JBLU) capacity increased 10.7% to 4.05B available seat miles. The carrier's load factor improved to 83.9% during the month. JetBlue expects Q4 passenger revenue per available seat mile to decline 2% to 3% year-over-year.
Shutterfly COO Daniel McCormick plans to resign on February 19, 2016. The news comes a week after Shutterfly (NASDAQ:SFLY) announced the resignation of CEO Jeffrey Housenbold and two months after the company's CFO was replaced. Shares of Shutterfly are up 28% since reaching a 52-week low in late September.
CST Brands is on the radar of several companies after the company received some pressure from hedge fund Engine Capital to explore strategic alternatives. Marathon Petroleum (NYSE:MPC), Speedway, Sunoco (NYSE:SUN), and Alimentation Couche-Tard (OTCPK:ANCUF) are seen as potential bidders. CST closed yesterday with a market cap of $2.82B.
Today's Markets
In Asia, Japan +1.0% to 19,230. Hong Kong -1.1% to 21464. China -0.6% to 3434. India -0.8%% to 25044.
In Europe, at midday, London -0.8%. Paris -0.9%. Frankfurt -1.3%.
Futures at 6:20, Dow -0.5%. S&P -0.4%. Nasdaq -0.5%. Crude -1.4% to $36.26. Gold -0.5% to $1066.60.
Ten-year Treasury Yield -2 bps to 2.21%.
Today's Economic CalendarIn Europe, at midday, London -0.8%. Paris -0.9%. Frankfurt -1.3%.
Futures at 6:20, Dow -0.5%. S&P -0.4%. Nasdaq -0.5%. Crude -1.4% to $36.26. Gold -0.5% to $1066.60.
Ten-year Treasury Yield -2 bps to 2.21%.
8:30 Producer Price Index
8:30 Retail Sales
10:00 Business Inventories
10:00 Reuters/UofM Consumer Sentiment
1:00 PM Baker-Hughes Rig Count
Companies reporting earnings today8:30 Retail Sales
10:00 Business Inventories
10:00 Reuters/UofM Consumer Sentiment
1:00 PM Baker-Hughes Rig Count
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