Oil slides; Google bets on China; Internet tax decision

1. Oil slides continues: US crude futures continued to drop on Monday, falling 1.6% to trade at $64 ...

Posted: Jun 18, 2018 9:19 AM
Updated: Jun 18, 2018 9:19 AM

1. Oil slides continues: US crude futures continued to drop on Monday, falling 1.6% to trade at $64 per barrel.

Investors are nervous ahead of a key meeting in Vienna later this week between OPEC and other major oil producers. The key question is whether supply caps that have been in place since the beginning of 2017 will be eased.

That would add more oil into the market, potentially squeezing prices. The outcome is far from certain, however, with some key OPEC members said to be resistant to supply increases.

Supply disruptions caused by US sanctions on Iran and political instability in Venezuela could also play a major role in market dynamics.

2. Google bets on China: Google has announced that it will buy a $550 million stake in, the Chinese e-commerce firm and Alibaba rival.

The companies will join forces to sell goods online across Southeast Asia, the United States and Europe.

Google's most popular products -- its search engine, Gmail and YouTube -- remain banned in China. But the company has recently increased investment in China and across Asia.

3. Brexit pain: The British Chambers of Commerce has slashed its growth forecast for the United Kingdom. It now expects economic growth of just 1.3% in 2018, the slowest pace since 2009.

BCC blamed the downgrade on the uncertainties around Brexit, interest rate hikes, trade war risks and rising oil prices.

"A decade on from the start of the financial crisis, the United Kingdom now faces another extended period of weak growth amidst a backdrop of both domestic and global uncertainty," said Adam Marshall, the group's director general.

Investors will get another update on the British economy on Thursday, when the Bank of England unveils its latest monetary policy decision.

4. Internet tax decision: The US Supreme Court could announce a decision as early as Monday in South Dakota vs. Wayfair, a case that could force customers to pay sales tax on more online purchases.

Under current rules, many online retailers don't collect sales tax unless they have a physical presence in the state where the buyer lives.

Last year, states could have collected as much as $13.4 billion in additional online sales taxes, according to the Government Accountability Office.

5. Global market overview: US stock futures were pointing lower.

Major global markets in Europe and Asia also dipped. Markets in Hong Kong and mainland China were closed for a holiday.

The Dow Jones industrial average closed 0.3% lower on Friday, while the S&P 500 declined 0.1% and the Nasdaq shed 0.2%.

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6. Coming this week:
Monday - Possible decision in South Dakota vs. Wayfair case
Tuesday - FedEx earnings
Wednesday - American Outdoor Brands earnings; Senate Finance Committee tariff hearing
Thursday - Darden, Kroger earnings; bank stress test results, Bank of England meeting
Friday - OPEC meeting

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