Here are 4 tips for today's trading. This will help you decide where you should invest and what to look for:
1) Oil Slides
The price of crude oil is off by nearly 2% and trading below $63 per barrel. Oil prices have fallen by nearly 40% since June, which has created a lot of uncertainty as investors try to guess when the price will bottom out.
Falling oil prices have wreaked havoc on the oil industry, but given a boost to travel companies and changed the business landscape for many other sectors.
2) Up or Down?
US stock futures were not making any big moves ahead of the open after staging a massive drop and a subsequent comeback on Tuesday.
The Dow Jones industrial average fell by 222 points before recovering to close with a 51 point loss on Tuesday. The S&P 500 landed barely in the red, and the Nasdaq rose about 0.5%.
3) International Markets Mixed
European markets are mostly rising in early trading, but Greek stocks were edging lower. Furious selling sent the market in Athens down nearly 13% on Tuesday as new elections rekindled worries about a possible default.
Asian markets ended with mixed results. The Shanghai Composite rebounded about 3% after suffering heavy falls Tuesday. The benchmark Nikkei index in Japan slid by 2.3% as data showed a drop in consumer confidence.
4) Earnings Updates
Costco (COST), Lands' End (LE) and Vera Bradley (VRA) will report earnings before the opening bell.
Men's Wearhouse is among the companies reporting after the close.
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What is it? It checks the percentage of the total work force that is unemployed and actively seeking employment during the previous month.
Although it's generally viewed as a lagging indicator, the number of unemployed people is an important signal of overall economic health because consumer spending is highly correlated with labor-market conditions.
When? December 10th at 7:30pm Eastern Time.
Trading Tip: If the number is lower than the forecast, you can expect the AUD to rise.
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What is it? It checks the change in the number of employed people during the previous month.
Job creation is an important leading indicator of consumer spending, which accounts for a majority of overall economic activity.
When? December 10th at 7:30pm Eastern Time.
Trading Tip: If the number is higher than the forecast, you can expect the AUD to rise.
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What is it? Governor Wheeler is due to testify before the Finance and Expenditure Select Committee, in Wellington.
As head of the central bank, which controls short term interest rates, he has more influence over the nation's currency value than any other person. Traders scrutinize his public engagements as they are often used to drop subtle clues regarding future monetary policy.
When? December 10th at 7:10pm Eastern Time.
Trading Tip: If the announcement will hint towards higher interest rates, you can expect the NZD to rise.
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What is it? It's among the primary tools the RBNZ uses to communicate with investors about monetary policy. It contains the outcome of their decision on interest rates and commentary about the economic conditions that influenced their decision. Most importantly, it discusses the economic outlook and offers clues on the outcome of future decisions.
When? December 10th at 3:00pm Eastern Time.
Trading Tip: If the announcement will hint towards higher interest rates, you can expect the NZD to rise.
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What is it? It's among the primary tools the RBNZ uses to communicate with investors about monetary policy. It covers in detail the factors that affected the most recent interest rate decision, such as the overall economic outlook and inflation. Most importantly, it provides clues regarding future monetary policy.
When? December 10th at 3:00pm Eastern Time.
Trading Tip: If the announcement will hint towards higher interest rates, you can expect the NZD to rise.
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What is it? It checks the interest rate at which banks lend balances held at the RBNZ to other banks overnight.
Short term interest rates are the paramount factor in currency valuation - traders look at most other indicators merely to predict how rates will change in the future.
When? December 10th at 3:00pm Eastern Time.
Trading Tip: If the number is higher than the forecast, you can expect the NZD to rise.
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US markets declined with the S&P 500 experiencing its biggest decline in 7 weeks. Losses were led by energy companies which dropped as oil prices continued to fall. Worries about global growth and weak data from Asia also pushed prices lower.
Asian markets declined across the region. The Nikkei lost 0.68% as the Dollar posted losses against the Yen, falling below 120. Chinese markets were hit by falling energy shares but losses heightened following the Central Economic Work Conference.
European markets are lower today as traders react to signs of slowing global growth.
Oil dropped to a new 5 year low after Iraq cut their prices to Asia in response to a previous cut by Saudi Arabia. The selloff began when OPEC decided not to cut production at their last meeting and analysts estimate that the price could remain low for up to 6 months if no cut is made. The API will release inventory data later today and could spark short term volatility.
Gold rallied and climbed above $1200/ounce as fears over global growth resurfaced following weak data from Japan and Europe. The price also climbed as the stock market declined and people reinvested in the metal. Gains may be limited, however, as speculation has increased that the Federal Reserve could hike US interest rates sooner.
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Here are 4 tips for today's trading. This will help you decide where you should invest and what to look for:
1) Stock Markets Tumbling
Every single major global stock market is trading in the red -- or closed with losses Tuesday -- and US stock futures are looking pretty weak.
Traders are blaming oil for the widespread loss of confidence in stock markets. Crude oil is trading below $64 per barrel, a level not seen since 2009, and that is seriously hurting oil companies and igniting concerns about a squeeze on the booming American oil industry.
"Investors are worried that there is no floor in sight for crushing oil prices," said Naeem Aslam, chief market analyst at AvaTrade.
Across Europe, most indexes are declining by more than 1%. The losses were even more dramatic in Asia, where the Shanghai Composite index plunged more than 5%.
2) Tesco Troubles
In the UK, shares in the grocery giant Tesco (TSCDY) tumbled about 11% after the company issued another profit warning. The grocer has been struggling amid increased competition and an accounting scandal in which it admitted to overstating its profit forecasts. Even the stalwart shareholder Warren Buffett has been cutting back on his investment in the company.
3) Russian Ruble Sinking
The Russian ruble continued declining Tuesday and is trading near all-time lows. The currency has fallen by about 40% against the US dollar this year.
The Russian economy has been hit from all sides this year as it struggles with Western sanctions, declining oil prices and high inflation.
Experts are increasingly worried Russian authorities may introduce capital controls -- which limit the flow of money -- in an effort to manage the economy. However, a move of this kind can further erode confidence in the financial system and spur consumer panic.
4) Monday Market Recap
US indexes lost ground in the previous session. The Dow Jones industrial average lost 0.6%, while the S&P 500 slid 0.7% and the Nasdaq closed down 0.8%.
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What is it? It checks the change in the price of goods and services purchased by consumers.
Consumer prices account for a majority of overall inflation. Inflation is important to currency valuation because rising prices lead the central bank to respond by raising interest rates.
When? December 9th at 8:30pm Eastern Time.
Trading Tip: If the number is higher than the forecast, you can expect the CNY to rise.
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What is it? It checks the change in the number of new loans granted for owner-occupied homes.
It's a leading indicator of demand in the housing market - most homes are financed, so it provides an excellent gauge of how many qualified buyers are entering the market.
When? December 9th at 7:30pm Eastern Time.
Trading Tip: If the number is higher than the forecast, you can expect the AUD to rise.
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What is it? It checks the number of job openings during the reported month, excluding the farming industry.
When? December 9th at 10:00am Eastern Time.
Trading Tip: If the number is higher than the forecast, you can expect the USD to rise.
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What is it? It checks the change in the estimated value of all goods and services produced by the economy during the previous 3 months.
When? December 9th at 10:00am Eastern Time.
Trading Tip: If the number is higher than the forecast, you can expect the GBP to rise.
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What is it? It checks the change in the total inflation-adjusted value of output produced by manufacturers.
It's a leading indicator of economic health - production reacts quickly to ups and downs in the business cycle and is correlated with consumer conditions such as employment levels and earnings.
When? December 9th at 4:30am Eastern Time.
Trading Tip: If the number is higher than the forecast, you can expect the GBP to rise.
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Here are 3 tips for today's trading. This will help you decide where you should invest and what to look for:
1) Records Tumble
The S&P 500 closed up 0.17% at another record level Friday, boosted by news that US employers added 321,000 jobs in November, making 2014 the strongest year for job growth since 1999.
Markets will be watching Monday to see if the Dow Jones Industrial Average can hit a new record at 18,000 points. The index came within 10 points of the milestone during Friday's session.
Early signs are that investors may have to wait a while longer, given a few reminders Monday about shaky global growth.
2) Japan's Recession
The world's third largest economy is in a deeper hole than expected. A second reading of third quarter GDP showed the economy shrank at a faster rate than previously thought, down 1.9% on an annual basis. An initial estimate put the contraction at 1.6%.
Voters go to the polls Sunday in parliamentary elections called early by Prime Minister Shinzo Abe in the hope that he'll secure a stronger mandate for his economic revival plan.
Japan's Nikkei was flat in a mixed session for Asian markets.
3) Europe Weakens
The downward revision to Japan's GDP data, combined with weak trade figures from China and a disappointing reading of German industrial production in October weighed on European markets in morning trade.
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Friday’s Nonfarm Payrolls data was much stronger than expected. The data showed that 321,000 jobs were created over the past month, much above the expected 225,000. Figures pushed markets higher but gains were limited as the data also fueled expectations that the Federal Reserve could hike interest rates sooner than expected.
Asian markets climbed across the region. The Nikkei finished with small gains of 0.08% as the Dollar continued to climb against the Yen, reaching levels not seen since 2007 and climbing above the key psychological level at 120. Gains were limited, however, due to a range of negative data out of Japan.
European markets are lower today as the data from Asia heightens fears over global growth.
Oil continues to decline as the U.S Dollar strengthens. Weak data out of Asia lowered demand for the commodity and pushed prices lower. This came after Saudi Arabia cut its export prices to Asia and the US late last week.
Gold dropped following the strong NFP data but has since regained some of its losses. The market is now weighing up the potential increase in US interest rates against stimulus measures in Europe and Asia. As there are no important economic events today the metal is expected to trade choppy.
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What is it? It checks the level of a diffusion index based on surveyed businesses, excluding the farming industry.
It's a leading indicator of economic health - businesses react quickly to market conditions, and changes in their sentiment can be an early signal of future economic activity such as spending, hiring, and investment.
When? December 8th at 7:30pm Eastern Time.
Trading Tip: If the number is higher than the forecast, you can expect the AUD to rise.
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What is it? It checks the change in the total value of new building permits issued.
It's an excellent gauge of future construction activity because obtaining a permit is among the first steps in constructing a new building.
When? December 8th at 8:30am Eastern Time.
Trading Tip: If the number is higher than the forecast, you can expect the CAD to rise.
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