Good morning! Here are the major stories you need to know in markets on Monday.
Goldman Makes A Big Oil Call. Falling oil prices have drillers sweating about the shrinking profitability of their operations. For now, the big oil producers aren’t cutting production. Goldman Sachs analysts warn that the price of oil would need drop to about $US40 for a six-month period before the high-cost US shale drillers really feel the pain.
Oil Prices Tumble. West Texas Intermediate crude oil fell 3% to as low as $US47.06 earlier Monday, the lowest level in five and a half years.
Stocks Are Higher. US futures are pointing up, with Dow futures up 100 points and S&P 500 futures up 12 points. In Europe, Britain’s FTSE 100 is up 0.3%, France’s CAC 40 is up 1.5%, and Germany’s DAX is up 1.6%. Japan’s market was closed for a national holiday.
It’s A Quiet Day For Data. There is practically no economic data coming out Monday, until 10 p.m. ET when the US releases its Labour Market Conditions Index for December, which should give an extra hint at the health of the American workforce.
Pharma Giant Shire Bought US Biotech Firm NPS For $US5.2 Billion. It’s Shire’s biggest acquisition yet, as the Dublin-based drugmaker strengthens its position in the lucrative field of medicines for rare diseases.
Spain’s Radical Left-Wing Podemos Is Back In the Lead. A poll published Sunday showed that the leftist upstart Podemos was again in the lead to win Spain’s next general election. The Metroscopia poll of 1,000 people, published in the left-leaning newspaper El Pais, showed one-year-old Podemos (We Can) would take 28.2% of the vote, up from 25% in December, when it fell back to second place.
Japan’s Next Budget Will Be Its Biggest Ever. Japan’s government will propose a record budget for the next fiscal year of more than $US800 billion (£530 million) while cutting borrowing for a third year, government officials said Sunday, as Prime Minister Shinzo Abe seeks to maintain growth while curbing the heaviest debt burden in the industrial world.
VW Has A Turnaround Plan For US Markets. Volkswagen has struggled in North American markets in recent years, but the carmaker now reportedly plans to triple its product range in the fast-growing crossover segment and refresh models more quickly. The campaign will include a five-seat variant of the coming mid-size sport-utility vehicle (SUV), a concept version of which VW will unveil Monday at the Detroit auto show, sources told Reuters.
Venezuela’s President Has Been Visiting Other OPEC Nations After His Trip To China. Nicolas Maduro held talks in OPEC’s leading oil producer Saudi Arabia on Sunday, officials said, after visiting Iran and before he headed to Algeria for further dialogue about low prices in the world’s crude. The already-unhealthy Venezuelan economy is being hit hard by falling oil prices.
Narendra Modi Just Promised A ‘Quantum Leap’ For India’s Economy. Prime Minister Narendra Modi showcased his fiefdom of Gujarat on Sunday to political and business leaders, trying to demonstrate how the thriving western state could be the role model for India’s economic transformation.
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