In corporate news, Tesla ( TSLA) shares sank more than 6% after Bloomberg reported that the company plans to cut production at its Shanghai factory, the latest sign of weak demand in China. On Sunday, OPEC+, or the Organization of the Petroleum Exporting Countries and its allies, including Russia, stayed the course on planned production cuts. The yield on the benchmark 10-year Treasury note Monday moved back up past 3.5%, while oil prices fell as new sanctions on Russian energy took effect, with WTI crude settling at $77.33 per barrel. Meanwhile, another batch of third-quarter earnings figures will be out, finishing off the reporting season. “It's fascinating that at the moment the market is focusing squarely on the very strong likelihood that we'll ratchet down to 'only' a 50bps hike next week and extrapolating that level of dovishness rather than focus on any risks that the terminal rate could end up being nearer say 6% than 5%,” Jim Reid and colleagues at Deutsche Bank wrote in an early morning note Monday. New readings on the producer price index (PPI) - which measures prices paid for goods and services before they reach consumers and consumer sentiment - will be out this week. Friday’s figures showed demand for workers remains out of balance with supply, signaling that Fed policymakers could either take rates higher than previously anticipated or hold them higher for longer in restrictive territory. The strong job gains and robust wage growth are the opposite of what the Federal Reserve would like to see in its battle against inflation. The new data comes on the heels of Friday's hotter-than-expected jobs report, which sent stocks to a choppy session. New business activity fell at the sharpest rate since May 2020, S&P Global said. In a separate report, however, S&P Global's the Purchasing Managers’ Index (PMI) stood at a 46.2 level in November, down from the October reading of 47.8. Meanwhile, new orders for U.S.-manufactured goods also beat expectations, rising 1.0% in October. The index expanded faster in November than anticipated, at a 56.5 level compared to estimates of 53.5 and above October’s reading of 54.4, painting the picture of a still-strong services industry. Leading the economic calendar for the week was the release of the Institute for Supply Management's (ISM) services index. The economic data front provided further bearish signals for stocks, as key indicators came in stronger than expected.
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