By Geoffrey Smith
Investing.com — The United States releases producer price inflation data for November, in a market that needs to see further evidence of falling commodity prices to maintain confidence in a central Monetary Policy. Washington becomes more aggressive against Big Tech, aiming to cancel Microsoft’s deal for Activision. Stocks are set for their first in three weekly losses, with Lululemon’s forecast pointing to a drop in consumer spending. The UK is trying to ease pressure on its struggling financial centers, and oil is rising, but is on course for its lowest weekly close this year. Here’s what you need to know in financial markets on Friday, December 9.
1. The US PPI seems to point to an easing of price pressures
The US releases data for November, which should add to a picture of increasingly rapid disinflation for traded goods as some important base effects disappear from year-over-year calculations.
The ‘core’ is expected to fall below 6% for the first time since June 2021, amid growing evidence of discounting to move excess inventory and downward momentum from rising energy prices earlier this year. On a month-over-month basis, however, prices are expected to recover after stagnating in September.
PPI data at 08:30 ET (1:30 GMT) will be followed by revised Michigan Consumer Sentiment Survey data for November at 10:00 ET (15:00 GMT).
2. Microsoft and Activision Stay Informed of FTC Antitrust Lawsuit
Shares of Microsoft (NASDAQ:) and Activision (NASDAQ:) held up reasonably well after the Federal Trade Commission filed a long-awaited lawsuit to stop the Redmond-based software giant from taking control of the software maker. video games.
“Microsoft has already shown that it can and will withhold content from its gaming rivals,” the FTC said in a statement, adding that it intended to prevent Microsoft from taking control of any of the largest independent game studios in the world and harming competition.
Microsoft’s promise earlier in the week to keep Activision’s biggest money-maker, Call of Duty, on the Nintendo Switch platform seems to have not cut the ice in a Washington that has become much more aggressive. with antitrust actions against Big Tech.
3. Stocks should open higher; apparel industry jitters after Lululemon advice
U.S. stock markets are set to open a bit later after underappreciated inflation in China overnight bolstered hopes that the country could export some disinflation to the global economy and remove the need for interest rates. higher interest.
As of 6:25 a.m. ET (11:25 a.m. GMT), were up 63 points, or 0.2%, while and were both up around 0.4%. The three major currency indexes are still on track to register their first weekly decline in three weeks after a period of nervousness over Federal Reserve policy earlier in the week.
Stocks likely to be targeted later include chipmaker Broadcom (NASDAQ:), which raised its forecast after producing better than expected in the past three months last Thursday, and Lululemon (NASDAQ:), which is in down 7% in pre-marketing. after its revenue and profit forecast for the key holiday quarter came in lower than analysts’ forecasts. Also worth noting is Chinese electric vehicle maker Li Auto (NASDAQ:), which spent money in the third quarter as it ramped up production.
4. UK eases financial regulations to help city under pressure
The UK has relaxed some of the rules it imposed on its financial sector following the 2008 financial crisis, in hopes of cementing its status as Europe’s largest financial centre.
As expected, the government will raise the threshold above which banks must protect their retail banking assets with a separate pool of capital, and change the rules governing long-term investments in infrastructure and other illiquid assets by insurers.
The government is also abolishing a cap on bankers’ bonuses, which was a key part of the European Union’s response to the 2008 crisis. Any deviation from existing European regulations will increase the likelihood that the EU will further restrict the ability of UK-based banks to access the European market. The measure is an interesting policy at a time when the government is trying to contain public sector wage costs in the context of a cost of living crisis.
5. Oil on track for weekly close low in 2022
Crude oil prices rose overnight but are still on track to hit their lowest weekly close this year and their biggest weekly drop since March.
As of 6:40 a.m. ET, futures were up 0.6% at $71.88 a barrel, while they were up 0.2% at $76.27 a barrel.
The Baker Hughes rig count, which hit its highest level since March 2020 last week, will end the week later, along with positioning data from the CFTC.
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