OECD Forecasts Global Economy to Slow to 3.1 Percent in 2022 and 2.2 Percent in 2023

Today, the U.S. stock index futures are trading higher in the premarket ahead of the release of the new financial results from Best Buy Co. (BBBY), Warner Music Group Corporation (WMG), and HP Inc. (HP). Previously, Dell Technologies (DELL) posted an annual decline in Q3 revenue. Meanwhile, Zoom Video Communications (ZM) downgraded its forecast for the 2022 FY revenue, which led to a drop in the shares' price. As of 1:25 p.m. CET, the Dow Jones Industrial Average is advancing by 0.22%. At the same time, the Nasdaq Composite is moving higher by 0.17%. The S&P 500 increased by 0.22% at the time of writing. The euro went up by 0.17% against the dollar concurrently to sell for $1.02603.

The Organization for Economic Co-operation and Development (OECD) said in its Economic Outlook report released earlier today that global growth is expected to slow to 3.1% in 2022 and fall even further to 2.2% in 2023. The thinktank stressed that “uncertainty about the outlook is high” and the risks have become “more skewed to the downside and more acute” amid concerns about high inflation and Russia's war in Ukraine, which particularly pushed energy prices up. “Global financial conditions have tightened significantly, amidst the unusually vigorous and widespread steps to raise policy interest rates by central banks in recent months, weighing on interest-sensitive spending and adding to the pressure faced by many emerging-market economies. The economic growth in the U.S. is expected to drop from 5.3% in 2021 to 1.8% this year, while Eurozone's GDP growth is set to fall from 5.3% last year to 3.3% in 2022. China's growth is seen tumbling to 3.3% from 8.1% in 2021.

Yesterday, U.S. equities fell to start what will be a holiday-shortened trading week on concerns about a politically torn Congress in the U.S., as well as a new Covid-19 outbreak in China and a volatile session for crude oil. Corporatewise, Tesla (TSLA) was the worst-performing stock in the S&P 500 on the EV-maker's recall of hundreds of thousands of cars, and the Covid-19 news out of China (more below). Tesla said over the weekend that it was recalling more than 321,000 vehicles because of a software glitch that could cause tail lights to fail intermittently. The National Highway Traffic Safety Administration (NHTSA) report indicated that in rare instances, one or both of the lights could be affected because of a “firmware anomaly.” Shares of other companies with exposure to China declined, such as Apple (AAPL), Nike (NKE), and casino operators Las Vegas Sands (LVS) and Wynn Resorts (WYNN).

Commoditywise, crude oil futures had a zigzagging session, plunging as much as 6% on a report OPEC+ countries were considering raising production, then recovering after Saudi Arabia denied the unconfirmed report. As a result, crude prices ended about 0.5% lower. The early drop led to a selloff in fossil fuel industry stocks, with shares of Diamondback Energy (FANG) and Devon Energy (DVN) falling more than 3%.

Today, the major European benchmarks traded mixed as investors looked for signals about the next monetary policy moves in recent comments by high-ranking European Central Bank officials. Elsewhere, British Prime Minister Rishi Sunak said that the United Kingdom would "not pursue any relationship with Europe that relies on alignment with EU laws," while Brussels reportedly plans to introduce more sanctions against Chinese authorities over plainly political issues, namely, allegations of human rights violations in Xinjiang. At the time of writing, the German DAX was flat, the British FTSE 100 added 0.62% and the French CAC 40 is losing 0.08%.

In Asia, the Shanghai Composite Index gained 0.6% to 3,104 and the Japan’s Nikkei 225 rose 0.61% to 28,115. The Hang Seng in Hong Kong sank 1.31% to 17,424. The Kospi in Seoul shed 0.59% to 2,405, while Sydney's S&P-ASX 200 gained 0.6% to 7,184. Chinese authorities are poised to impose a fine of more than $1 billion on Jack Ma's Ant Group, setting the stage for ending the fintech company's two-year long regulatory overhaul. Baidu (BIDU) reported this morning that its total revenue stood at 32.54 billion yuan or $4.57 billion in Q3 of fiscal 2022, rising 2% from the same year-ago period. Operating income soared 130% YoY to $747 million, while net loss trimmed 99% to $21 million. Diluted loss per American depositary shares (ADS) came in at $0.12 after falling 98% from Q3 of 2021.