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With our eye on the opening bell, here are five stories to watch in the stock market today:
Market News, Jan. 30:
- Saying Goodbye to Ben: On Wednesday, the Federal Reserve announced continued plans to wind down its immense bond-purchasing program. The two-day FOMC meeting was the last with Ben Bernanke chair of the central bank. The Fed will cut its bond-buying program to $65 billion in February, down from $75 billion this month. All 10 voting members of the board approved the plan – a rare Fed occurrence -signaling their desire to exit the program and little concern over weak December employment figures. As Janet Yellen assumes control of the Fed on Saturday, all eyes will be on next Friday's jobs report.
- More Bad News for Emerging Markets: Overnight, the Chinese Markit/HSBC Purchasing Managers' Index (PM) report was released, and the news isn't good. As domestic and export demand has weakened in China, the Index slumped to 49.6 in January from December's final reading of 50.5. Continued investor flight to safe-haven bonds this morning has dragged global stocks down to a two-and-a-half-month low. Many emerging markets, which rely heavily on trade in goods and commodities with China, declined this morning. India fell 1.25%, Japan shed 2.45%, and Thailand dropped 0.7%. The weak PMI data also lead to declines in gold prices, silver prices, and copper prices. [EXTRA: Our Chief Investment Strategist Keith Fitz-Gerald tells investors how to play the plunging global markets today.]
- One Man's Trash, Another Man's Treasure: Google Inc. (Nasdaq: GOOG) will sell its Motorola smartphone division to China's Lenovo Group (OTC: LNVGY) for $2.9 billion. The deal is a staggering loss for the Internet giant, which purchased Motorola Mobility in 2012 for $12.4 billion and was supposed to establish Google dominance in the mobile phone industry. Motorola has lost $2 billion since the acquisition and shaved its workforce by more than 80%. The deal provides the Chinese computer manufacturer with a strong brand as it will attempt to expand its operations in China and around the world. Google shares are up nearly 3% in pre-market trading.
- Zuckerberg's Fortune Grows Larger: Shares of Facebook (Nasdaq: FB) have surged more than 18% in pre-market trading. The company released earnings last night, and announced it had generated $2.59 billion in revenue in the fourth quarter, crushing analyst estimates. The company reported higher revenues in its ad and mobile business. According to reports, Facebook profits reached $523 million, a staggering increase from $64 million a year ago.
- Power Battle Emerges in OPEC: An Iraqi energy minister announced plans yesterday to triple the nation's oil production capacity to 9 million barrels a day by 2020. Both Iraq and Iran are now planning to ramp up production in an effort to unshackle Saudi Arabia's hold over OPEC. Saudi Arabia has been working to maintain low output on OPEC's behalf to maintain Brent crude prices above $100. Brent finished trading on Wednesday at $107.93.
Government Data Reported Today, Jan. 30:
- The U.S. Bureau of Economic Analysis will release its first estimate of fourth quarter gross domestic product (GDP) at 8:30 a.m. EST.
- Weekly jobless claims will be released at 8:30 a.m.
- Pending home sales data will be released at 10 a.m.
Companies Reporting Earnings Today, Jan. 30:
- Exxon Mobil Corp. (NYSE: XOM): Consensus earnings per share is $1.90.
- Visa Inc. (NYSE: V): Consensus earnings per share is $2.16.
- Eli Lilly and Company (NYSE: LLY): Consensus earnings per share is $0.73.
- ConocoPhillips (NYSE: COP): Consensus earnings per share is $1.33.
- Altria Group (NYSE: MO): Consensus earnings per share is $0.58.
- United Parcel Service Inc. (NYSE: UPS): Consensus earnings per share is $1.25.
- Also reporting earnings: Amazon.com (Nasdaq: AMZN), Celgene Corporation (NYSE: CELG), Occidental Petroleum Corporation (NYSE: OXY), 3M Company (MMM), Enterprise Products Partners L.P. (NYSE: EPD), Colgate-Palmolive Company (NYSE: CL), Thermo Fisher Scientific Inc. (NYSE: TMO), Google Inc. (Nasdaq: GOOG)
About the Author
Garrett Baldwin is a globally recognized research economist, financial writer, and consultant with degrees from Northwestern, Johns Hopkins, Purdue, and Indiana University. He is a seasoned financial and political risk analyst, with a focus on stocks, hedge funds, private equity, blockchain, and housing policy. He has conducted risk assessment projects for clients in 27 countries, and consulted on policy and financial operations for some of the nation's largest financial institutions, including a $1.5 trillion credit fund, a $43 billion credit and auto loan giant, as well as two of the largest Wall Street banks by assets under management.
Garrett joined Money Map Press as an economist and researcher in 2011, specializing in alternative strategies with an emphasis on fundamental and technical analysis.