Dow Jones today, June 16, 2014: The Dow Jones Industrial Average posted gains on Friday, despite growing macroeconomic concerns. All eyes this week will focus on the Federal Open Market Committee meeting, which kicks off tomorrow.
The Fed meeting isn't expected to provide any surprises. The central bank will likely maintain low interest rates and will likely continue tapering its bond-purchasing program by another $10 billion to a total of $35 billion each month.
Here are the top stories that will be moving the Dow Jones today:
Merger Mania Continues:The New York Times reported late last night that U.S. medical device maker Medtronic Inc. (NYSE: MDT) has purchased Covidien Plc. (NYSE: COV) in a deal worth $42.9 billion. The deal is yet another inversion designed to reduce taxes and shift the company's operations out of the United States and into Ireland. Medtronic shares were up 11.9% in pre-market trading, while Covidien jumped 35%.
Debt Nation: In a surprise report by Standard & Poor's, China has overtaken the United States as the top borrower of corporate debt. The Chinese corporate debt market hit $14 trillion at the end of 2013, and it is expected to swell to one-third of the global corporate debt market in the next five years. By comparison, the U.S. corporate debt market in 2013 was $13.1 trillion.
Today's Economic Calendar: Today's schedule features the Housing Market Index, the Empire State Manufacturing Survey, and Industrial Production figures. Analysts expect the housing market index to increase to 47 from a prior 45. Analysts expect industrial production to increase 0.5% after the 0.6% decline in April.
Gushing Megadeal: In what could create the largest Master Limited Partnership by enterprise value, pipeline operator Williams Cos.(NYSE: WMB) announced it had acquired Access Midstream Partners LP(Nasdaq: ACMP) for $5.99 billion. Access is the nation's largest gathering and processing MLP by volume, and with a merger of Williams' MLP, Williams Partners LP(NYSE: WPZ), would create a new unit valued at more than $100 billion, according to Reuters.
New Tensions in Ukraine: Geopolitical problems continue to drive shockwaves across the energy industry. This morning, Russian gas company Gazprom announced that Ukraine failed to pay its gas debts by today's deadline. Gazprom has ordered that Ukraine pay for all future orders up front, creating new pressures and concerns that Russia may now cut off European energy supplies. The global energy markets are already spiking due to ongoing conflict in Iraq, where Al-Qaeda-linked forces have seized a number of key cities.
A New Bidder Emerges: Germany's Siemens AG(OTC ADR: SIEGY) and Japan's Mitsubishi Heavy Industries and Hitachi are preparing a joint offer for Alstom's turbine business. The announcement is a major challenge to General Electric Co. (NYSE: GE), which has been in talks with the French government for weeks after the Alstom board approved a $17 billion deal for its energy business.
Earnings Reports: Stay tuned for earnings reports from Motorcar Parts of America Inc.(Nasdaq: MPAA), Layne Christensen Co.(Nasdaq: LAYN), Pier 1 Imports Inc.(NYSE: PIR), Progressive Corp. (NYSE: PGR), and Korn/Ferry International(NYSE: KFY).
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.