It’s going to be an interesting day.
The U.S. dollar is gaining strength, commodity prices are crumbling, and markets are awaiting a massive M&A announcement.
Here are the six things you need to know before the opening bell rings in New York:
1. Markets expect M&A announcement: Shares in Allergan are rising by about 3% premarket on expectations that U.S. pharmaceutical giant Pfizer is set to announce a takeover deal.
If the deal goes through with the reported price tag north of $150 billion, it would be the second-largest takeover of all time, according to data from Dealogic.
2. Stronger U.S. dollar slams energy: The U.S. dollar is showing significant strength against all other major currencies after a member of the Federal Reserve said this weekend that there are good reasons to raise interest rates in December.
This has pushed down prices of oil and natural gas, since both commodities are priced in dollars. Oil prices are dropping by 3% to trade around $40.60 per barrel.
Shares in major oil and gas companies are also under pressure.
“A stronger dollar and lower commodity prices hit … commodity exporting countries’ currencies, and both the Australian dollar and the New Zealand dollar have weakened,” explained a market analysis note from SEB bank.
3. Stocks watch: There’s a bit of a negative mood in the stock markets this morning. U.S. stock futures are dipping down.
European markets are mostly declining in early trading, while Asian markets ended with mixed results.
Brussels, the capital city of Belgium and the home to the European Union and NATO headquarters, remains on high alert for terrorism after authorities warned Friday night of a possible imminent threat to the city.
However, there’s a bit of good economic news out of Europe. New November data from Markit shows business activity and employment has been growing at its fastest rate in over four years.
4. Earnings: Tyson Foods and Gamestop will report quarterly results ahead of the opening bell.
After the close investors will hear from a handful of companies, including cereal maker Post.
5. Economics: The National Association of Realtors will release its October existing home sales report at 10 a.m. ET. The report gives investors an update on the start of the U.S. real estate market.
6. Weekly market recap: Stocks experienced some stellar gains last week. The Dow Jones industrial average shot up by 3.4%, the S&P 500 gained 3.3% and the Nasdaq jumped by 3.6%.
