Geoffrey Smith 

Investing.com — A veritable feast for U.S. data is available, including consumer spending prices, the Federal Reserve’s preferred gauge of inflation, and weekly jobless claims. This was done to keep the Thanksgiving Holiday from taking place.  Germany’s new government will be presented by Olaf Scholz (center-left politician, former finance minister of Angela Merkel). Stocks will open lower as concerns over inflation and monetary tightening, along with worries about disruptions in supply chains, continue to bubble. Walgreens, CVS and other pharmacies are dragged into an opioid legal maze by an Ohio verdict. Oil prices rebounded after Tuesday’s spike. What you need to know for financial markets on Wednesday, November 24th.

1. Pre-Thanksgiving data dump

Gear up for tomorrow’s guzzle-fest by gorging on a vast spread of U.S. economic data, which will likely inform the Federal Reserve’s next deliberations on whether or not to speed up the phase-out of its bond purchases.

An aperitif consists of weekly mortgage market data at 7 AM ET (1200 GMT), and a main meal consisting of updated third-quarter GDP data. Side dishes include weekly jobless claims and October durable goods orders.

Make sure you leave a little intellectual space for dessert though – the core personal consumer expenditures index for October is due at 10 AM ET, along with personal income and household spending data.  The minutes of the Fed’s most recent meeting will be served alongside coffee, digestiveifs, and cigars.

2. Germany sets to introduce a new government

Germany’s first three-way government coalition in more than 50 years will be unveiled at a news conference on 9:00 AM ET.  It will confirm Olaf Scholz from the centre-left Social Democratic Party as Chancellor. Christian Lindner of pro-business, somewhat euroskeptic Free Democrats is likely to take over the Finance Ministry. Third in the coalition is the Greens.

Given that the FDP and Greens are at opposing ends of the debate around issues such as climate change and taxation, the coalition will have to work harder than the ones dominated by Angela Merkel’s Christian Democrats to stay coherent.

The new coalition takes power against a rapidly worsening health backdrop: the 7-day infection rate for Covid-19 is running at over twice last winter’s peak. The expectations subindex of the Ifo institute’s business confidence index dipped accordingly in November.

3. Stocks will open at a lower level due to inflation and retail jitters

The U.S. stock market is set to open later than usual due to ongoing pressure from the bond market, which looks increasingly nervous as the Fed begins to reduce its asset purchases.

At 6:15 AM ET they were down 170 points or 0.5% and down 0.4% respectively. The Nasdaq had underperformed against a backdrop of renewed selling of Tesla (NASDAQ:) stock by CEO Elon Musk, while warnings of supply chain problems and possible inventory shortages had spooked retailers such as Best Buy, Gap, Urban Outfittters and Abercrombie & Fitch.

After missing the earnings estimates on Tuesday, Gap is expected to be under pressure. In today’s earnings, Deere (NYSE:) & Co’s numbers and outlook will be scrutinized for the impact of labor disputes – a phenomenon that may well broaden in the coming months.

4. Drug quagmire drags pharmacies

Walgreens and CVS were found guilty by a federal jury. This could be significant as the affected families and the public seek justice.

A jury found that they were responsible for approximately $2 billion of damages caused by Lake and Trumbull County in Ohio under public-nuisance laws.

It’s not clear that this will automatically create a precedent that will decide any similar suits in future, not least since public-nuisance legislation varies from state to state. The case was, however, one of a number of so-called ‘bellwether’ cases which may serve as guidance for claims elsewhere.

5. Lower oil after API data

Crude oil prices are correcting after a short-term surge on Tuesday in response to the coordinated announcement of reserve releases by the world’s biggest importers.

While the volumes involved don’t appear enough to signal a real change in the current supply-demand balance, the political signalling effect of a coalition spanning the U.S., India and China – rivals in every other sphere – was perhaps stronger than at first appreciated.

Data from American Petroleum Institute revealed a 2 million barrel increase in inventory last week. The government’s data are due at 10:30 AM ET, as usual.

By 6:25 AM ET, U.S. crude futures were down 0.4% at $78.19 a barrel, while futures were down 0.5% at $81.88 a  barrel.