JPMorgan facing criminal probe over currency trades

HONG KONG (CNNMoney)

The largest U.S. bank by assets made the disclosure Monday in a regulatory filing. JPMorgan (JPM) said that other regulators, including the Commodity Futures Trading Commission and the U.K. Financial Conduct Authority, are pursuing civil investigations.

The bank said it was cooperating with the regulators, and was engaged in active discussion with the DOJ. "There is no assurance that such discussions will result in settlements," the filing cautioned.

The firm, led by CEO Jamie Dimon, also hiked one estimate of the possible costs of current legal proceedings against the bank to $5.9 billion.

JPMorgan (JPM) is far from the only bank under investigation for possible foreign currency market abuse. Financial regulators have been looking into whether the banks sought to manipulate interest rates, with internal and external probes involving UBS (UBS), Deutsche Bank (DB), Barclays (BCS) and the Royal Bank of Scotland (RBS), among others.

The disclosure from JPMorgan comes as U.S. officials turn up the heat on big banks.

Related: Forex fraud: Now it's getting serious

JPMorgan acknowledged the changing climate in the regulatory filing, saying that U.S. government officials have "emphasized their willingness to bring criminal actions against financial institutions" in recent months.

"Such actions can have significant collateral consequences for a subject financial institution, including loss of customers and business and the inability to offer certain products or services or operate certain businesses for a period of time," the bank said.

First Published: November 4, 2014: 5:11 AM ET

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Stocks: 5 things to know before the open

LONDON (CNNMoney)

Here are the five things you need to know before the opening bell rings in New York:

1. It's all about Alibaba: Alibaba (BABA, Tech30) is set to release its first earnings report since its mega IPO. Investors are eagerly anticipating the results. Alibaba is now worth more than Wal-Mart.

2. More earnings: Plenty of other companies will also be releasing quarterly results. Other big names reporting before the opening bell include Burger King (BKW), Office Depot (ODP), Estee Lauder (EL) and CVS Health (CVS).

21st Century Fox (FOX) will report after the close.

3. Elections and economics: Midterm elections have arrived in the U.S. The results will determine what President Obama can get done in his final two years in office. They will also tee up the 2016 presidential contest.

The European Commission slashed its expectations for eurozone growth in its latest autumn economic report. The commission now expects the economy will grow by only 0.8% this year, 1.1% in 2015 and 1.7% in 2016. It also gave major downgrades to the outlook for the two largest eurozone economies — France and Germany. The eurozone continues to struggle with terribly low inflation and high unemployment.

At 8:30 a.m. ET, the U.S. Census Bureau will release September data on the trade balance.

4. Market moves: U.S. stock futures were moving lower ahead of the open and European markets were also declining. The market mood appeared to have soured after the economic forecast came through from the European Commission.

U.S. stocks closed little changed on Monday. The Dow slipped 24 points and the S&P 500 barely budged. The Nasdaq was up just shy of 0.2%.

5. Turning Japanese: The Nikkei topped 17,000 in early trading — a level not seen since 2007 — as investors continued to cheer the Bank of Japan's decision to inject more cash into the economy. The Japanese yen continues to weaken versus the U.S. dollar.

First Published: November 4, 2014: 4:54 AM ET

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Starwood hotels let you unlock your hotel room with your phone

NEW YORK (CNNMoney)

Starting Wednesday, guests will be able to use their smartphones as room keys at ten Starwood hotels (HOT) around the world. The technology will be available in all 150 Aloft, Element, and W Hotels by early next year.

"My mobile device now is like my remote control for life," Starwood Hotels and Resorts CEO Frits van Paasschen told CNNMoney. "There's no reason why that shouldn't be your portal to get to your room, ask for what you want, or anything else."

Guests can check in using the Starwood app. They receive their room number and Bluetooth key. That means they can bypass the front desk and head straight to their room.

Related: Harry Potter hotel website crashes

To open the hotel door, it's as simple as holding the phone up to the door lock and waiting for a click.

Van Paasschen says mobile keys are a safer option for guests.

"If you lose your mobile device, you notice right away. If you have to use your passcode to get into your phone, even if someone finds your phone they can't get into your room." van Paasschen said.

Starwood, the parent company of Sheraton, Westin, and St. Regis hotels, is not the only chain trying to make key cards obsolete. Hilton (HLT) is working on a similar technology.

And most major hotel chains are funneling money into improving their apps and mobile services. They're betting on mobile options like check-in and check-out to win over millennials. Apps may also provide a better way to sell room service, upgrades, and other offerings.

Related: How much should you tip housekeeping?

Starwood says mobile keys and check-in are just an initial step in its mobile plans.

"We're increasingly going to upgrade the functionality of the app so you can do things like tell us where you are and what you want," van Paasschen said. "We can start to send you offers targeted to exactly what you want."

First Published: November 4, 2014: 6:45 AM ET

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Wall Street donors dump Democrats

Wall Street isn't digging the Democratic party right now.

NEW YORK (CNNMoney)

A record 63% of the political contributions from employees and corporations in the banking and investment sectors went to Republicans this election cycle, according to data from the Center for Responsive politics. It's the largest dollar figure ($78 million) and percent for the GOP in any midterm election.

The donations are likely based on a bet that Republicans have the best shot at victory on Tuesday.

Related: Wall Street predicts GOP mid-term victory

"You want to be with the winner," said Dorsey Farr, co-founder of French Wolf & Farr, an investment advisory firm in Atlanta. "A lot of times you'll see companies give to both parties. If they see the tide turning, they'll go with the flow."

The figures don't include money channeled through political action committees, which have played an increasingly prevalent role in campaign finance in recent years.

But the boosted election expenditures from the financial world this time around also have to do with the fact that the Democratic Party has turned up the heat on Wall Street since the financial crisis.

"Democrats are just more of the regulatory party," said Ray La Raja, a political science professor at the University of Massachusetts - Amherst, adding that they used to be more amenable to the things Wall Street cared about.

Related: Complete coverage of the 2014 midterms

"In the past bankers could work with any party. Now, all things equal, they'd rather work with Republicans," he claimed.

But beyond the strategic calculations, there's also a philosophical element, with many on Wall Street having grown tired of being punished for their industry's past deeds.

Almost all of the major banks have paid out unprecedented multi-billion settlements in recent years for their role leading up to the financial meltdown.

They've also become a political punching bag.

Early in his first term, President Obama famously contended that he didn't get elected to help out "a bunch of fat cat bankers on Wall Street." And he's repeatedly tried to close tax loopholes that benefit hedge fund and private equity managers.

"Wall Street feels rightly or wrongly like they've been demonized by this administration," asserted La Raja.

But it doesn't really matter to most people whether or not a bunch of investor types have had their feelings hurt.

Related: Millionaire tax on the ballot in Illinois

In fact, bashing Wall Street excess is still a favorite tactic for many politicians. In a recent interview with Salon, prominent Senator Elizabeth Warren (D-Massachusetts) lambasted the president's economic team for picking Wall Street over Main Street.

And possible 2016 Democratic presidential candidate Hillary Clinton had to backpedal from comments she made at an event earlier this month in which she told the crowd, "don't let anybody tell you that it's corporations and businesses that create jobs."

Warren spoke at that same event, and political commentators were quick to speculate that Clinton was appealing to her party's left leaning, anti-Wall Street base.

According to La Raja, the populist theme will continue to resonate with voters into the 2016 Presidential election as long as the economic recovery remains sluggish for many Americans.

Related: Will this get millennials to buy homes?

On the other hand, "If all engines are running and the economy is doing well, populism dies."

Still, it's not as if Wall Street has totally abandoned Democrats. Senator Cory Booker (D-New Jersey) was the top recipient of contributions from members of the investment community this election, having raked in almost $1.9 million.

Charles Schumer (D-New York), traditionally a friend of Wall Street who sits on the the influential Senate Finance Committee, pulled in about $850,000.

"I'm sure they're not going to piss off a powerful Democrat," La Raja said of big Wall Street donors.

First Published: November 3, 2014: 7:28 AM ET

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One World Trade Center opens today

NEW YORK (CNNMoney)

The building opens Monday, when the first tenant, Conde Nast, moves in. The publisher moves its 3,400 staffers into the 24 stories it is occupying, from floor 20 through 44.

One World Trade Center is opening 13 years after its predecessor was destroyed on September 11.

There are several buildings at the site. But the centerpiece is the One World Trade Center, a skyscraper that is 104 stories and 1,776 feet tall, a height that represents the year of United States independence. This includes the 408 foot spire atop the 1,368 foot tower.

It's taller than the original Twin Towers, which were 1,727 feet with the antenna, or 1,362 without.

The building has 3.5 million square feet of space, including offices, parking and an observatory, scheduled to open next spring.

Related video: Inside the new World Trade Center

Other tenants include the U.S. Army Corps of Engineers, U.S. Customs and Border Protection and the China Center, a liaison for U.S. and Chinese businesses. But many of the floors remain unoccupied. The owners of the tower recently slashed the rent from $75 to $69 per square foot.

Located near Wall Street in lower Manhattan, the building was developed by the Port Authority of New York and New Jersey, which owns the 16-acre site.

One World Trade Center cost $3.9 billion to build. The planning and construction were complicated by fighting among developers, realtors and insurers.

The new building replaces the Twin Towers, which were destroyed on Sept. 11, 2001, when al Qaeda terrorists flew two hijacked passenger jets into the buildings, killing 2,753 people. This was part of a wider attack that also killed hundreds of people at the Pentagon and in Pennsylvania.

First Published: November 3, 2014: 7:43 AM ET

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Branson: I'll still be first space passenger

Richard Branson remains committed to being the first space tourist on his company's space flights.

NEW YORK (CNNMoney)

"There is no way I would ask others to go on a Virgin Galactic flight if I didn't feel it was safe enough for myself," he told CNN on Monday.

Branson said the 800 passengers who have signed up to spend $250,000 each on the flights remain supportive of his company's plans. Two more signed up and paid for their flights on Friday as a show of support for the program, he said.

"They want to see this happen, and they want to show their commitment," Branson said.

He said that despite the crash and the death of co-pilot Michael Alsbury, "The risk is worth it. Mike would have been the first to say that."

Related: Initial findings into cause of SpaceShipTwo crash

Branson, 64, is married with two children. He has said some of his family will join him on the first tourism flight.

He has tried daredevil moves of his own in the past.

Branson and a pilot were the first to cross the Atlantic in a hot air balloon in 1987, three years after he founded Virgin Atlantic airlines. He also set a record for the fastest crossing of the English Channel in an amphibious vehicle in 2004.

That same year was when he unveiled plans for Virgin Galactic, which sponsored SpaceShipOne's debut flights to space. Forbes estimates his net worth at $4.9 billion.

Branson said he's been given clearance by the National Transportation Safety Board to go ahead with space flights with the next rocket now nearing completion, even as the agency investigates the crash and destruction of SpaceShipTwo.

But Branson said it is too soon to say how long the first tourist flight might be delayed by the accident. He had been hoping to start flying passengers as soon as next year.

The crash was apparently caused by the early deployment of devices known as feathers designed to slow the aircraft on its return to earth, according to the NTSB's initial findings revealed Sunday.

Branson said the NTSB has definitively found that there was no explosion of the rocket or fuel tank and that he believes the final findings into crash will not take long.

First Published: November 3, 2014: 8:45 AM ET

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Wall Street donors dump Democrats

Wall Street isn't digging the Democratic party right now.

NEW YORK (CNNMoney)

A record 63% of the political contributions from employees and corporations in the banking and investment sectors went to Republicans this election cycle, according to data from the Center for Responsive politics. It's the largest dollar figure ($78 million) and percent for the GOP in any midterm election.

The donations are likely based on a bet that Republicans have the best shot at victory on Tuesday.

Related: Wall Street predicts GOP mid-term victory

"You want to be with the winner," said Dorsey Farr, co-founder of French Wolf & Farr, an investment advisory firm in Atlanta. "A lot of times you'll see companies give to both parties. If they see the tide turning, they'll go with the flow."

The figures don't include money channeled through political action committees, which have played an increasingly prevalent role in campaign finance in recent years.

But the boosted election expenditures from the financial world this time around also have to do with the fact that the Democratic Party has turned up the heat on Wall Street since the financial crisis.

"Democrats are just more of the regulatory party," said Ray La Raja, a political science professor at the University of Massachusetts - Amherst, adding that they used to be more amenable to the things Wall Street cared about.

Related: Complete coverage of the 2014 midterms

"In the past bankers could work with any party. Now, all things equal, they'd rather work with Republicans," he claimed.

But beyond the strategic calculations, there's also a philosophical element, with many on Wall Street having grown tired of being punished for their industry's past deeds.

Almost all of the major banks have paid out unprecedented multi-billion settlements in recent years for their role leading up to the financial meltdown.

They've also become a political punching bag.

Early in his first term, President Obama famously contended that he didn't get elected to help out "a bunch of fat cat bankers on Wall Street." And he's repeatedly tried to close tax loopholes that benefit hedge fund and private equity managers.

"Wall Street feels rightly or wrongly like they've been demonized by this administration," asserted La Raja.

But it doesn't really matter to most people whether or not a bunch of investor types have had their feelings hurt.

Related: Millionaire tax on the ballot in Illinois

In fact, the populist backlash against Wall Street excess still plays a prevalent role in politics. In a recent interview with Salon, prominent Senator Elizabeth Warren (D-Massachusetts) lambasted the president's economic team for picking Wall Street over Main Street.

And possible 2016 Democratic presidential candidate Hillary Clinton had to backpedal from comments she made at an event earlier this month in which she told the crowd, "don't let anybody tell you that it's corporations and businesses that create jobs."

Warren spoke at that same event, and political commentators were quick to speculate that Clinton was appealing to her party's left leaning, anti-Wall Street base.

According to La Raja, the populist theme will continue to resonate with voters into the 2016 Presidential election as long as the economic recovery remains sluggish for many Americans.

Related: Will this get millennials to buy homes?

On the other hand, "If all engines are running and the economy is doing well, populism dies."

Still, it's not as if Wall Street has totally abandoned Democrats. Senator Cory Booker (D-New Jersey) was the top recipient of contributions from members of the investment community this election, having raked in almost $1.9 million.

Charles Schumer (D-New York), traditionally a friend of Wall Street who sits on the the influential Senate Finance Committee, pulled in about $850,000.

"I'm sure they're not going to piss off a powerful Democrat," La Raja said of big Wall Street donors.

First Published: November 3, 2014: 7:28 AM ET

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Singapore tops the list of best places to do business

Singapore is the best place to do business, the World Bank said.

LONDON (CNNMoney)

No wonder, then, that the tiny island nation tops the World Bank's ranking of the best places to do business in the world -- for the ninth year in a row. New Zealand and Hong Kong ranked second and third on the list.

The report notes that business owners in Singapore spend an average of 82 hours a year trying to resolve tax issues. That's half as much as the 175 hours that business owners spend dealing with tax issues in the U.S., which ranked seventh on the list.

It praises New Zealand for an efficient planning system that makes it easy for people to get a business off the ground and cites Hong Kong's low corporate tax rate.

Switzerland entered the top 20 for the first time after it passed new rules protecting minority shareholders.

The good news is that 80% of the 189 countries the World Bank ranked have improved their scores since last year.

Tajikistan, Benin and Togo are three countries that showed the most improvement.

Benin, which jumped 16 spots to number 151, passed new laws protecting minority shareholders, while Togo climbed 15 spots to 149, after making it easier to get a construction permit. Tajikistan moved up nine spots to 166.

Here are the top 10:

1. Singapore

2. New Zealand

3. Hong Kong

4. Denmark

5. Korea

6. Norway

7. United States

8. United Kingdom

9. Finland

10. Australia

First Published: November 3, 2014: 5:31 AM ET

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Stocks: 3 things to know before the open

Click chart for in-depth premarket data.

LONDON (CNNMoney)

Here are three things you need to know before the opening bell rings in New York:

1. Timid trading after stocks hit records: It looks like stocks could start the month on the back foot after October's fireworks. U.S. futures are edging lower and there's a lack of direction in the markets.

European markets were edging lower in early trading. Asian markets ended with mixed results.

October was an explosive month, ending with a bang on Friday. The Dow, S&P 500 and Nasdaq rallied by more than 1% on Halloween. Both the Dow and the S&P 500 closed at record highs and the Nasdaq is at its highest point since the March 2000 Dot-com peak.

The latest reading on the CNNMoney Fear & Greed index shows investors are still feeling fearful, but the extreme fear from mid-October has been shaken out of the markets.

Related: Faster Internet access in the middle of the ocean

2. Earnings: Sysco (SYY) and Sprint (S) will report quarterly earnings before the opening bell. Herbalife (HLF) will report after the close.

L'Oreal (LRLCF) is expected to report after the close of trading in Paris.

HSBC (HSEA) reported earnings in the early morning. Third quarter underlying pre-tax profit fell 12%, in part because the global bank set aside $378 million to cover its exposure to an investigation into alleged rigging of the foreign exchange market. Its shares were about 0.5% lower in London trading.

3. Economics: The ISM Manufacturing Index is set to come out at 10 a.m. ET. At the same time, the U.S. government will report monthly construction spending.

Throughout the day, automakers will be releasing data on October car and truck sales.

New monthly data from HSBC and Markit show the Chinese manufacturing sector is just barely growing. The HSBC Purchasing Managers' Index came in at 50.4 in October, up from 50.2 in September. A number over 50 indicates growth, while a number below 50 indicates contraction.

First Published: November 3, 2014: 5:08 AM ET

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GOP win could spark party on Wall Street

NEW YORK (CNNMoney)

A Republican takeover of the Senate would relieve investors who have been hoping for (and betting on) more pro-business policies.

"If the Republicans blow it, that could be a problem," said Sam Stovall, chief investment strategist at S&P Capital IQ.

If the GOP pulls off the victory, these three sectors will celebrate the most:

Related: Wall Street predicts GOP mid-term victory

1. Energy: A Republican takeover of the Senate could reignite Wall Street's love affair with the energy sector, which has been battered lately by tumbling oil prices.

Consider that Halliburton (HAL) fell 14.5% in October alone, and Hess (HES) was down 10%.

In a recent poll of money managers and brokers by ConvergEx Group, 90% of respondents said energy stocks will benefit from a GOP midterm victory.

The logic is thus: Republicans will push for more lenient environmental policies that could help fossil fuel companies, or at least block tougher regulations by Democrats.

That's especially true for coal stocks that have been hurt by proposed rule changes by the Environmental Protection Agency. One proxy for coal stocks, the Market Vectors-Coal ETF (KOL), has slumped 7% over the past year while the overall market rallied.

A GOP Senate could also raise the pressure on the White House to loosen restrictions on energy exploration, especially key projects like the controversial Keystone XL pipeline.

"You have a lot more history of Republicans being friendly to the energy industry. The XL pipeline left a sour taste in people's mouths," said Nicholas Colas, chief market strategist at ConvergEx.

Related: What happens if Republicans win the Senate?

2. Financials: If the GOP takes over the Senate, and thus control of the powerful Senate banking committee, the rules should tilt more in favor of banks.

That would be a relief for a sector that has lived under the cloud of the Dodd-Frank reform law, which has handcuffed the activities of big banks and increased regulatory costs for smaller ones.

Eighty-eight percent of respondents in the ConvergEx survey said the financial sector would benefit from a Republican win.

"There is a concern that Democrats have put in excessive regulation that diminishes banks' return on capital, particularly for smaller, regional banks. The big money center banks are in a league of their own," said Colas.

Related: Halloween treat as stock market soars

3. Industrials: Republicans tend to support more defense spending by the federal government. That's music to the ears of defense companies like Lockheed Martin (LMT) and Boeing (BA) that make up a chunk of the industrial sector and rely on lucrative government contracts.

Defense stocks have already benefited from increased military spending sparked by the recent military efforts to destroy ISIS in Iraq and Syria.

"Energy and defense companies tend to be GOP pet projects," said Stovall.

Multinational industrial stocks like Caterpillar (CAT) could also benefit from more aggressive trade policies written by a Republican-controlled Congress, Colas said.

The lone wolf sector: If Democrats manage to keep the Senate, the health care industry will cheer.

A divided Congress would have a difficult time repealing ObamaCare, which has benefited certain parts of the health care industry like hospital operators, HMOs and even some drug makers.

"Maybe we can fine tune the Obama health care plan, but the Republicans have been talking about getting it repealed. Why upset the applecart? It would be a reinjection of unquantifiable uncertainty," said Stovall.

Don't forget about earnings: Of course, the midterm election isn't the only event that could move stocks this week. Investors get more corporate "report cards" from companies like CVS (CVS), Walt Disney (DIS) and Whole Foods (WFM).

Nearly 350 S&P 500 companies have already reported earnings for the third quarter, with an impressive 75% of them beating Wall Street's expectations, Capital IQ said. That's pretty solid and reinforces optimism about the health of Corporate America.

The focus will shift back to the U.S. economy when the government releases its closely-watched jobs report for October on Friday.

First Published: November 2, 2014: 9:20 AM ET

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