Concerns about geopolitical pressures in Ukraine temporarily abated, but investors are taking notice of brewing economic problems in Europe. A slew of bad data suggests a choppy road ahead for the European Union, which has a combined GDP that is roughly $600 billion larger than the U.S. economy.
Here are the top stories in stock market news today (Thursday):
- Murdoch Wins: Shares of Twenty-First Century Fox Inc. (Nasdaq: FOXA) were up nearly 5% in premarket hours on news that the company reported fourth-quarter revenue growth of 17% and a massive jump in net income to nearly $1 billion compared to a $371 million loss in the same period last year. The company reported remarkably strong revenue growth from its Filmed Entertainment division, reporting a 38% increase in year-over-year revenue growth. The good news comes a day after the company's leader Rupert Murdoch announced he had withdrawn his $80 billion bid to purchase Time Warner Inc. (NYSE: TWX), a decision that sent the stock up another 3.5% yesterday before reporting earnings.
- Sailing Away: Chinese online travel company Ctrip.com International Ltd. (Nasdaq: CTRP) is up more than 10% in premarket hours on news that Priceline Group Inc. (Nasdaq: PCLN) plans to invest $500 million into the company. The online travel company consolidates hotel accommodations, hotel reservations, and other travel itinerary purchases in the Chinese market. Shares of Priceline were unchanged this morning. The deal announcement comes on the same day that Priceline competitor Orbitz Worldwide Inc. (Nasdaq: OWW) saw shares fall 2.5% before the bell after the company missed quarterly earnings expectations of $0.15 per share, registering just $0.06.
- Around the World: As geopolitical concerns rattle investor confidence, two key central banks elected to leave their interest rates unchanged. The Bank of England remained pat on its benchmark rate at 0.5%. The U.K. central bank hasn't hiked rates since 2007, but calls for an increase are heating up. Meanwhile, the European Central Bank (ECB) kept its primary financing rate at 0.15%, a record low, with deposit rates at -0.1% and marginal lending rate at 0.4%. ECB President Mario Draghi will hold a press conference this morning to explain the bank's decision.
You can access the rest of this story - including GOOGL's latest (and very smart) acquisition, Australian economic woes, today's economic calendar, and more - absolutely for free. Provide your email address for all of our full coverage.
- Here We Go Again: On the other side of the world, Australia's economy continues to struggle, drawing new attention to a typically unmonitored area of the Asia-Pacific markets for retail investors. The nation saw its unemployment rate jump to 6.4%, up from 6% in June. This is the worst joblessness rate in a decade and raises expectations that the nation's central bank will push interest rates downward to fuel new growth
- Merger Mania: Online tech giant Google Inc. (Nasdaq: GOOG, GOOGL) announced it has purchased Emu, a smart messaging service that provides a built-in assistant for users. Terms of the deal were not disclosed, but Emu's service will be shut down on August 25 so that the two companies can integrate their technologies. The service will allow Google to update its Google Hangouts service, enabling users to set calendar reminders, make reservations, and complete other tasks without having to change windows. With mobile and tablet screen-time becoming the new commodity war between Google and rivals like Facebook Inc. (Nasdaq: FB), the deal provides a strategic advantage.
- Today's Economic Calendar: Today's schedule includes Weekly Jobless Claims, the EIA Natural Gas Report, the Fed Balance Sheet, and the Bloomberg Consumer Comfort Index.
- Banks Behaving Badly: The Wall Street Journal reports that federal regulators are on the brink of reaching a $16 billion to $17 billion settlement with Bank of America Corp. (NYSE: BAC) over misconduct related to mortgage products in the run-up to the 2008-09 financial crisis. The deal would be the largest settlement ever between a financial firm and regulators, far outpacing the $13 billion deal between the U.S. Justice Department and JPMorgan Chase (NYSE: JPM). The settlement comes a day after Bank of America announced it would be allowed to raise its dividend for the first time in seven years to $0.05.
Earnings Reports: Stay tuned for earnings reports from Bankrate Inc. (NYSE:
RATE), Erickson Inc. (Nasdaq: EAC), Linn Energy LLC (Nasdaq: LINE), NRG Energy Inc. (NYSE: NRG), Orbitz Worldwide Inc. (NYSE: OWW), SolarCity Corp. (Nasdaq: SCTY), The Wendy's Company (Nasdaq: WEN), and Zynga Inc. (Nasdaq: ZNGA).
Full U.S. Economic Calendar August 7, 2014 (NYSE: all times EDT)
- Jobless Claims at 8:30 a.m.
- Bloomberg Consumer Comfort Index at 9:45 a.m.
- EIA Natural Gas Report at 10:30 a.m.
- 3-Month Bill Announcement at 11 a.m.
- 6-Month Bill Announcement at 11 a.m.
- Consumer Credit at 3 p.m.
- Fed Balance Sheet at 4:30 p.m.
- Money Supply at 4:30 p.m.
Stress between the U.S. and Russia comes on top of a long list of global crises involving civil war, invasion, and terrorism. The active war zones are the visible hot spots - but there is growing tension just beneath the surface as well. Money Morning Special Contributor and NY Times best-selling author James G. Rickards calls it "Cold War 2.0." Here's his story...