Today's stock market news, Feb. 18, 2014: The Dow Jones Industrial Average rose 126.80 points on Friday to finish at 16,154.39, while the S&P 500 and Nasdaq were flat. With several prominent firms reporting earnings this morning, pre-market trading and the futures are relatively quiet.
Five Biggest Stories in Today's Stock Market, Feb. 18, 2014
A Healthcare Blockbuster: According to TheWall Street Journal, Actavis Plc, the world's second-largest generic-drug maker by market cap, is set to purchase Forest Laboratories Inc. (NYSE: FRX) for nearly $25 billion. Shares of Forest Labs shot up more than 33% in pre-market trading. The deal is a major boost for activist investor Carl Icahn, who is Forest's second-largest shareholder and earned a board seat in 2012.
Why Is Global Warming Bad, Again? On Wednesday, the Federal Reserve will release its Federal Open Market Committee meeting minutes. The arctic blast of wintry weather that paralyzed the United States this month is expected to have a significant presence in the report. According to a CNBC Fed Survey of economists, the recent surge of wintry weather has had a massive impact on the economy. The total impact of the weather is now one-third of a percentage point of annual GDP, or nearly $50 billion. The survey indicates that 76,000 jobs were also casualties.
Another Big Media IPO: According to a company job posting, the music streaming service Spotify is likely preparing for an IPO for this year. Reuters reported that the company created a listing for an External Reporting Specialist, a position that requires the preparation of SEC filings and reports. The company is valued at a little more than $7 billion, but it is currently failing to run a profit on $720 million a year in gross revenue.
A Sweet Deal in the Works: King Digital Entertainment Plc, the creator of the highly popular mobile game Candy Crush Saga, has filed to raise $500 million in an IPO for 2014. In the fourth quarter of 2012, King's combined total revenue was $71 million. In the same quarter of 2013, revenue soared to $632 million with a profit margin of nearly 38%. The game was 2013's top downloaded free application and has 500 million downloads since its 2012 launch. Credit Suisse (NYSE: CS), JP Morgan Chase (NYSE: JPM), and BofA Merrill Lynch (NYSE: BAC) are among the IPO's lead underwriters.
Note: The Fed's 2014 taper means volatility ahead. So we've outlined how to find profits in a volatile market - like triple-digit gains in just days - if you start with this strategy...
U.S. Economic Calendar Feb. 18, 2014
Empire State Manufacturing Survey at 8:30 a.m.
Treasury International Capital at 9 a.m.
Housing Market Index at 10 a.m.
E-Commerce Retail Sales at 10 a.m.
4-Week Bill Announcement at 11 a.m.
3-Month Bill Auction at 11:30 a.m.
6-Month Bill Auction at 11:30 a.m.
Key Companies Reporting Earnings Feb. 18, 2014
Consensus earnings per share for Waste Management Inc. (NYSE: WM) is $0.60.
Consensus earnings per share for Panera Bread Co. (Nasdaq: PNRA) is $1.94.
Consensus earnings per share for The Coca-Cola Co. (NYSE: KO) is $0.46.
Consensus earnings per share for Medtronic Inc. (NYSE: MDT) is $0.91.
Consensus earnings per share for Duke Energy Corp. (NYSE: DUK) is $0.94.
Consensus earnings per share for Genuine Parts Co. (NYSE: GPC) is $0.92.
Others Reporting Earnings
Terra Nitrogen Company LP (NYSE: TNH), Healthcare Trust of America, Inc. (NYSE: HTA), Wolverine World Wide, Inc. (NYSE: WWW), Choice Hotels International, Inc. (NYSE: CHH), National Health Investors, Inc. (NYSE: NHI), Cheniere Energy Inc. (NYSEMKT: LNG), Herbalife Ltd. (NYSE: HLF), Potbelly Corp. (Nasdaq: PBPB), Norwegian Cruise Line Holdings Ltd. (Nasdaq: NCLH).
Garrett Baldwin is a globally recognized research economist, financial writer, consultant, and political risk analyst with decades of trading experience and degrees in economics, cybersecurity, and business from Johns Hopkins, Purdue, Indiana University, and Northwestern.