Dow Jones today, July 8, 2014: This morning, Apple Inc. (Nasdaq: AAPL), Groupon Inc. (Nasdaq: GRPN), and Alcoa Inc. (NYSE: AA) are among the day's more notable pre-market movers.
Yesterday,the Dow Jones Industrial Average dropped more than 50 points as investors weren't willing to take risky positions ahead of earnings season. Cyclical and small-cap stocks lagged the hardest yesterday afternoon. The CBOE Volatility Index soared more than 11%, the largest hike in nearly three months. The bounce was significant, as the index hit its lowest level since February 2007 last Thursday.
Here's what you should know to make your Tuesday profitable:
Merger Mania: In an effort to capture its target, U.S. drug manufacturer AbbVie Inc. (NYSE: ABBV) announced it has raised its offer for Shire Inc. (Nasdaq: SHPG) to 51.15 pounds per share. Shire initially rejected AbbVie's first offer, which has been a common trend in healthcare mergers and acquisitions this year.
I Spy: In yet another embarrassing foreign policy blunder, the United States has been exposed for spying on German officials. The Wall Street Journal reports that the Central Intelligence Agency has been receiving classified information from someone working inside Germany's Federal Intelligence Service.
Today's Economic Calendar: Today's schedule features the weekly ISCS-Goldman Stores sales report, the JOLTS report, the Fed Redbook, and two speeches by Federal Reserve bank presidents this afternoon.
Earnings Season: Second-quarter earnings season will unofficially begin this afternoon with the earnings report of aluminum giant Alcoa Inc. (NYSE: AA). The Street anticipates earnings of $0.12 per share and quarterly revenue of $5.66 billion.
Down on Airline Stocks: Investors continue to show bearish sentiment on the airline sector due to rising fuel costs and tightening household budgets. Shares of Delta Air Lines Inc. (NYSE: DAL) slipped another 1.5% this morning, as investors continue their sell-off of the stock. The stock continues to slide from its recent 52-week high.
A Nice Pop: Shares of Groupon Inc. (Nasdaq: GRPN) jumped more than 6% on news that the company was upgraded to a "Buy" by analysts at B. Riley. The analysts predicted that the company was on its way to improving margins and collecting easy business from customers. Groupon has been struggling in 2014, trading in the mid-single digits for several months.
iProfits: Shares of Apple Inc. (Nasdaq: AAPL) were on the move this morning, after the company reports its strongest sales since September 2012. Apple now has a market cap north of $600 billion and it is again stoking trader thoughts of becoming the first $1 trillion company. This news coincides with Chief Executive Officer Tim Cook's announcement that he is attempting to add new faces to the company's board of directors.
Earnings Reports: Stay tuned for earnings reports from Alcoa Inc. (NYSE: AA), Bob Evans Farms Inc. (Nasdaq: BOBE), and Container Store Group Inc. (NYSE: TCS).
Full U.S. Economic Calendar July 8, 2014
NFIB Small Business Optimism Index at 7:30 a.m.
ICSC-Goldman Store Sales at 7:45 a.m.
Redbook at 8:55 a.m.
JOLTS at 10 a.m.
4-Week Bill Auction at 11:30 a.m.
Richmond Federal Reserve Bank President Jeffrey Lacker speaks at 1 p.m.
3-Yr Note Auction at 1 p.m.
Minneapolis Federal Reserve Bank President Narayana Kocherlakota speaks at 1:45 p.m.
Consumer Credit at 3 p.m.
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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.